“The World Bank’s Board of Executive Directors today approved a US $500 mln IBRD operation to finance the Second Programmatic Financial Sector Development Policy Loan in Ukraine. This new financing supports a number of high-priority reform measures in the banking sector in response to the financial crisis in Ukraine,” according to the World Bank press release.
“The Ukrainian authorities have taken some impressive steps to stabilize and reform the economy and we are now seeing tentative signs of stabilization, - said Qimiao Fan, World Bank Country Director for Belarus, Moldova, and Ukraine. - However, because the challenges are so unprecedented, it is critical that the authorities continue to accelerate reforms”.
The key purposes of the loan are strengthening the capacity of the Deposit Guarantee Fund in order to perform deposit payout functions in the case of bank failures, stabilizing the banking sector, supporting legal and institutional reforms (particularly, focusing on limiting related-party lending in the banking system).
The World Bank is a major development partner of Ukraine. With this new budget support operation, the Bank’s current financial support to the country amounts to about US$4 bln.
