COOPERATION OF BANKS WITH INTERNATIONAL FINANCIAL ORGANISATIONS (IFOS): REGULATORY CHALLENGES AND LIQUIDITY SUPPORT TOOLS IN TIMES OF CRISIS

The article considers the peculiarities of the impact of cooperation with IFIs on the stability of the banking system of Ukraine in crisis conditions. The regulatory challenges that arose in the process of such collaboration and what opportunities Ukrainian banks received from cooperation with IFIs are analysed. Practical recommendations for the banking sector of Ukraine on optimising interaction with MFIs and using their tools to strengthen liquidity and stability are formulated. The banking system of Ukraine has withstood the most difficult test, largely due to international support. Countries that effectively cooperate with international financial partners recover faster and more confidently. The work uses a descriptive-analytical method with elements of comparison. The chronology of key events in cooperation with MFIs is traced, and the impact of these events on the indicators of the banking system is analysed. Cooperation of the banking system of Ukraine with international financial organisations during 2019–2023 became a determining factor in its resilience to unprecedented crises. The analysis showed that thanks to the support of IFIs, Ukraine managed to avoid bank panics during the pandemic and war, stabilise the financial sector and lay the foundation for future recovery – cooperation with IFIs required Ukraine to balance between different goals. Ukraine continued strategic reforms even during the war, which was demanded by the IFIs. Flexibility in the short term is combined with rigidity in the long term. Recommendations to the banking sector include the following areas. First, it is necessary to continue close cooperation with MFIs at the stage of recovery. This means not only fulfilling the conditions of the current IMF program, but also initiating new projects with other MFIs. Secondly, it is necessary to focus on institutional capacity and the rule of law. The trust of MFIs and investors depends on the perception of the risks of corruption and political interference. Therefore, the banking sector must ensure the real independence of the NBU (to avoid any political pressure), to continue the reform of courts and law enforcement agencies, so that contracts and loan agreements are properly executed. MFIs, for their part, are ready to increase investment in a well-governed environment – for example, IFC could expand lending if there was confidence in fairness. Third, it is necessary to use the best practices of regulation. The Ukrainian regulator should continue to implement the Basel III/IV standards by European integration plans. This includes adapting approaches to wartime risks. Working with the Basel Committee and the IMF on macroprudential policy will help create a more resilient financial sector. Fourth, Ukrainian banks should more actively enter international capital markets with the support of MFIs and develop new services.