Transcript The present and the future of the Ukrainian financial system

The present and the future of the
Ukrainian financial system
Hrant Bagratyan
Budapest 2013
Contents
1.
2.
3.
4.
General overview
Structure of the Ukrainian financial system
Ukrainian commercial banks
Insurance market and non state pension
funds
1.1. General overview
Top 20 economies by GDP 2010 and Ukraine, bln of current USD
16000
14000
12000
10000
8000
6000
4000
2000
0
Ukraine
Poland
Swiss
Indonesia
Turkey
Netherlands
Australia
South
Mexico
Spain
Russia
Canada
India
Italy
Brazil
UK
France
Germany
Japan
China
USA
http://data.worldbank.org/indicator/NY.GDP.MKTP.CD
3
1.2. Disproportional developments among the subjects of the worlds economy.
Top 20 economies by per capita GDP, Poland, Russia, Ukraine
160000
140000
120000
100000
80000
60000
40000
20000
0
Ukraine
Russia
Poland
France
Iceland
Germany
Australia
Japan
Singapore
Finland
Austria
Andorra
Ireland
Canada
Netherlands
USA
Sweden
Denmark
San Marino
Swiss
Norway
Luxembourg
Lichtenstein
http://data.worldbank.org/indicator/NY.GDP.PCAP.CD
4
1.3 The essence of economic growth: cumulative
economic growth
• In 1990-1999 Ukraine’s GDP decreased 8.8% a year. As a result by 1999 the
country’s GDP was only 40.8% of 1990’s level. In 2000-2007 GDP
increased 7.1% per year. As a result GDP increased up to 72.5% of 1990’s
level.
• In 2008-2012 the country’s GDP decreased up to 69.1% of 1990’s level.
•
http://data.worldbank.org/topic/economic-pol
•
icy-and-external-debt; www.ukrstat.gov.ua
5
1.4 But …
• The country shows very good performance in hightech (by example, one of the best figures on cellular
phones; Ukraine’s cultivated arable land in 2009 was
270.000 he, while Russia only 3000)
• It’s educated better than world average
• High number of internet users
• The best figure in the world in mobile subscribers
6
6
2.1. The structure of the Ukrainian financial system
(2011), assets, in % to GDP
(http://www.bank.gov.ua/doccatalog/document?id=121942; http://www.dfp.gov.ua/734.html
)
Financial organizations
USA
Ukraine
1
2
3
Commercial banks
Non state Pension funds
Insurance companies
Mutual and investment
funds, credit unions and
other financial companies
26,3
28
12,7
92,2
0,01
6,5
33
1,3
2.2. Synopsis
• The banking system practically absorbing all
savings
• Labor productivity in banking sector less than in
Europe but equal to Russia
• NPF aren’t developed and state pension fund
(193 bln UAH = 50% of the consolidated budget
expenses) is a permanent threat for the country’s
public finances
• There is a shortage of instruments to create longterm investment money, mutual funds and other
investment institutions – unable to provide them
2.3. Assets and liabilities of Ukrainian
banks, bln UAH, www.bank.gov.ua; http://www.ukrstat.gov.ua/
Assets
01.01.2009
01.01.2010
01.01.2011
01.01.2012
Liabilities
Total
% of GDP
Total
% of GDP
889
917
1090
1212
94
100
101
92
771
784
942
1054
81
86
87
80
9
2.4. Inflation and Spread between deposits and
loans, http://www.bank.gov.ua/doccatalog/document?id=260214; «Бюлетень Національного Банку
України»
Figures
Years
2008
2009
2010
2011
2012
1
2
3
4
5
6
CPI
122,3
112,3
109,1
108,0
100,6
Average % on deposits,
UAH, households
10,7
15,3
12,7
13,8
19,6
Average % on loans, UAH,
households
25
26
26,6
22,8
29
2.5. Reserve to cover possible losses on credit operations,% of all
reserves under active operations of banks
01.01.
2007
01.01.
2008
01.01.
2009
01.01.
2010
01.01.
2011
01.10.
2011
3.6%
3.08%
4.81%
11.27%
11.99%
12.06%
11
2.6. Geographical controversies of liabilities and assets of
banking system, 2010
Regions
Per capita GRP,
UAH thousand
Per capita deposits,
UAH thousand
Per capita loans,
UAH thousand
1
2
3
4
Kiev obl and city
…
Chernovetz
…
Zakarpatya
…
Jitomir
45848
…
9382
…
10055
…
11518
35617
…
3080
…
2299
…
2850
78568
…
5550
…
5511
…
3651
The average for
Ukraine
19551
8448
15835
2.7. Distribution of deposits and loans between households and
NFC’s in 2005-2011, UAH million,
http://www.bank.gov.ua/Publication/econom/Buleten/2010/bull_12-10.pdf.
Years
Resident’s deposits
Resident’s loans
Total
Deposits,
NFC
Deposits,
Househol
ds
Total
Loans,
NFC
Loans,
Househol
ds
1
2
3
4
5
6
7
2005
134754
50976
74778
143423
106078
35659
2006
185917
65614
108860
245230
160503
82010
2007
283875
95583
167239
426867
260476
160386
2008
359740
118188
217860
734022
443665
280490
2009
334953
94796
214098
723295
462215
241311
2010
404214
115175
264488
733181
494146
217361
2011
466042
131716
301128
773692
543500
208444
2.8. Figures of financial stability of European banking
systems, %
Country
Austria
Belgium
France
Germany
Greece
Italy
Norway
Portugal
Spain
Sweden
Average
Past due (Overdue) /
total loans
2006
2,1
1,7
3,0
3,4
5,4
4,9
0,6
1,2
0,7
0,6
2,4
2008
1,7
1,5
2,7
2,7
4,7
4,6
0,8
1,3
3,2
0,5
2,4
Provisions (reserves) Capital adequacy
for risks / total
overdue loans
2006
75,3
50,8
62,9
71,4
60,9
46,0
74,2
83,9
272,2
78,5
87,6
2008
76,4
64,0
61,4
77,3
49,5
50,8
75,7
71,3
79,9
67,4
2006
11,8
11,9
10,9
12,5
12,2
10,7
11,2
11,0
11,9
10,0
11,4
2008
11,7
12,9
10,1
12,9
10,4
10,4
11,4
10,2
11,3
10,2
11,2
2.9. Dynamics of credit risks of Ukrainian banks in 2002-2010,
bad loans in the portfolios of banks in Ukraine
10
9
8
7
6
5
4
3
2
1
0
9.36
5.8
4.52
3.4
3.32
2.1
2002
2003
2004
2005
2006
1.6
2007
2.2
1.3
2008
2009
2010
Частка проблемних кредитів у кредитному портфелі банків України, %
2.10. Synopsis
• Ukraine's loan portfolio of banks only 60.3% is formed from its own
resources (deposits, interbank loans within the country). The external
debt of the banks and NFC in 2012 was 56,3% of GDP.
• The inflation decreases but the Interest paid to the deposits increases and
the interest paid for loans getting up to 29%.
• The spread between deposits and loans in 2012 reduced showing certain
positive dynamics
• Further increase on reserves and capital requirements essentially
decrease the capacity of the economy to finance the growth
• Poor regions are financing relatively rich (central) regions, the
concentration grade of the economy permanently increases
• Big companies permanently increase their specific weight in the Ukrainian
financial market
16
3.1. Insurance market development, http://www.iii.org/;
http://www.dfp.gov.ua
Country
Assets of IC,
bln USD
IC’s assets
to GDP, %
Insurance
premiums,
bln USD
Specific
weight to the
world’s data,
%
USA
5310
45.2
1097.8
33.84
Japan
3533
66.9
492.4
15.18
UK
1885
96.5
246.7
9.09
France
1413
63.0
194.6
6.00
Germany
1372
45.5
190.8
5.88
Ukraine
7.2
6.5
2.8
<0.1
17
3.2. The insurance penetration level of the GDP of
Ukraine. Isurance premiums to GDP, %, 2009
8
7
6
5
4
3
2
1
0
Canada
Germany
Czech
Poland
Hungary
Slovenia
Bulgaria
Russia
Greece
Romania
Turkey
Ukraine
Kazakhstan
Nigeria
18
3.3 Consolidated structure of investment portfolio world’s top 5
pensions funds, 2006, http://www.watsonwyatt.com/europe/research/pdf/PI_300_Analysis_2007.pdf
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
Deposits
Real estate
Short term assets
Stocks
Bonds
Japan (GPIF), Norway (GPF), Netherlands
USA
Korea (NP),
936bln,$
285
(ABP), 273 (CALPERS),
203
218
19
3.4. Consolidated structure of investment portfolio of Ukrainian
pension funds, end of 2010, %,
http://www.kmu.gov.ua/control/en/publish/article?art_id=22835607&cat_id=73035
Others
Real estate
Precious
metals
Series1
Deposits
Securities
0
20
40
60
20
3.5. The structure of the investments of pension funds
in the world and Ukraine: reverse influence making
long money to short
60
50
40
30
World
Ukraine
20
10
0
s
ts
te
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i
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i
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s
e
t
o
ri
st
ar
p
u
e
h
ec
(s
al
De
e
S
s
k
R
oc
t
S
21
3.6. Insurance – synopsis
• Very low level of development
• Unreasonably high specific weight of deposits
in assets
• Limited capacity to accumulate means
• Dominations of state pension system
• Limits on cash generation