Ukraine's National Bank seek no role of mega-regulator – governor
Ukraine's financial market regulators, including the National Bank of Ukraine (NBU) and the National Securities and Stock Market Commission (NSSMC), have clearly defined statutory powers that must be executed effectively. The NBU does not claim the role of a mega-regulator, NBU Governor Andriy Pyshnyy said in an interview with Interfax-Ukraine.
"We do not seek the role of a mega-regulator. Each regulator must effectively and professionally fulfill its own mandate, working at the maximum of its capabilities... Our example of rebooting the insurance market proves that over five years, despite the pandemic and a major war, it is possible to achieve outstanding results," he said.
Pyshnyy noted that since the liquidation of the third market regulator, the National Commission for State Regulation of Financial Services Markets, in July 2020, and the transfer of most of its powers to the National Bank (the so-called 'split'), the situation in the insurance market has improved significantly. At the same time, the NBU still has a great deal of work to do in this area.
"We have enough responsibility, because the non-bank financial sector is not limited to insurance companies. Are we ready under such conditions to take on additional functions? I often hear such ideas, since the NBU is one of the largest capable institutions. However, it is important that the institutional capacity of other regulators is strengthened and developed symmetrically," the NBU governor said.
According to him, symmetric regulation is crucial for the market; otherwise, regulatory arbitrage emerges, generating uneven approaches.
"We have already seen such examples, when a regulator tries to close loopholes, introduce high-quality regulation and supervision, and bring the market back into the legal framework, but the market then begins moving in another direction in search of less scrutiny and more lenient regulatory requirements," Pyshnyy added.