PRESENCE OF FOREIGN CAPITAL IN WARTIME: A COMPARATIVE EMPIRICAL STUDY AND FINANCIAL SYSTEM RESISTANCE IMPLICATIONS

This article investigates the presence and impact of foreign capital in Ukraine's financial system during wartime. The authors conduct a comparative empirical study to analyze the dynamics of foreign investments and their implications for banking stability, considering historical context and contemporary economic realities. The study underscores the critical role of foreign capital in providing necessary liquidity and supporting the functionality of financial institutions amidst constrained economic potential. It identifies the main risks and benefits of foreign banks in Ukraine, including potential economic scale efficiencies, improved creditworthiness, and enhanced financial market infrastructure. However, it also addresses challenges posed by external control over credit resource distribution, increased dependency on global financial stability, and the risks of capital withdrawal. By integrating historical insights and contemporary empirical data, the article provides a nuanced understanding of the interplay between foreign capital and financial system stability in wartime. It examines the regulatory policies and strategic priorities of the National Bank of Ukraine aimed at minimizing negative effects and strengthening financial resilience. The authors propose strategies for managing liquidity risks, enhancing regulatory oversight, and fostering international investment while maintaining national interests. The findings contribute to the broader discourse on financial stability and resilience in conflict-affected regions, offering valuable perspectives for academic researchers and practitioners. The study's comparative approach allows for a thorough examination of the evolution of foreign investments in Ukraine's financial sector, highlighting key trends and shifts over time. It emphasizes the importance of foreign capital in maintaining the operational integrity of financial institutions, especially during periods of economic strain caused by conflict. The article also explores the role of foreign banks in facilitating access to international financial markets, thereby improving the overall creditworthiness of the Ukrainian banking system. Despite the benefits, the presence of foreign capital introduces specific vulnerabilities. The article discusses the potential risks associated with external control over credit resource allocation, which can lead to increased dependency on global financial conditions. Additionally, the possibility of sudden capital withdrawal poses a significant threat to financial stability. The authors suggest implementing robust regulatory frameworks and strategic policies prioritizing national interests while encouraging foreign investment to mitigate these risks. In conclusion, the article offers a comprehensive analysis of the impact of foreign capital on Ukraine's financial system during wartime. It provides valuable insights into the complex relationship between foreign investments and banking stability, highlighting both the advantages and challenges. The proposed strategies for managing liquidity risks and enhancing regulatory oversight aim to strengthen financial resilience and ensure the sustainable development of Ukraine's financial sector in the face of ongoing conflict.