RFU approves: the government is preparing to privatize the remaining state-owned banks
21 August 14:38
The Financial Stability Council (FSC) has issued a positive opinion on the possibility of selling state-owned stakes in two systemically important banks – Sens Bank and Ukrgasbank. In fact, the first step towards privatization of state-owned banks in accordance with the terms of the IMF program has been taken, "Komersant Ukrainian" reports.
At a meeting on August 14, 2025, the members of the RFS concluded that the privatization of these banking institutions does not pose a threat to the country’s financial system.
“The members of the RFS agreed that the sale of stakes in Sens Bank and UKRGASBANK will not have a negative impact on the financial condition and stability of the banking system within the framework of the sale procedure established by the Law,”
– the RFS said in a statement.
The decision of the RFS paves the way for the government to make an official decision on preparing the stakes in these banks for sale. According to Ukrainian law, the opinion of the RFC is a prerequisite for the start of the privatization procedure for state-owned banks.
The initiative to reduce the state share in the banking sector is set out in the Memorandum on Economic and Financial Policy of June 19, 2025. The FSC members supported this strategic objective, but emphasized the need for a balanced approach aimed at increasing the value of banking assets.
State-owned banks in Ukraine: from privatization to nationalization
The history of state-owned banks in Ukraine is a history of reverse processes, privatization and nationalization. At the end of 1995, there were 230 banks in the country, of which only two were state-owned – Oschadbank and Ukreximbank. Oschadbank was the successor to the Soviet State Savings Bank, and Ukreximbank was created to finance export-import operations.
The situation changed dramatically after the banking crises of 2008-2009 and 2014-2016. In the history of modern Ukraine, there are three largest banks that were initially created by private capital and then nationalized and became state-owned. The largest nationalization was the transfer of PrivatBank from private to state ownership on December 18, 2016. Before that, Ukrgasbank and Sens Bank were also nationalized.
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Current situation
There are currently five state-owned banks in Ukraine: JSC CB Privatbank, JSB Ukrgasbank, JSC Ukreximbank, JSC Oschadbank, and JSC Sens Bank. These banks control almost half of the country’s banking system – about 49% of assets and 65% of the authorized capital of the entire banking system.
State-owned banks demonstrate stable profitability. Traditionally, the largest profit was made by the state-owned PrivatBank – UAH 34.879 billion in the first half of 2025. In total, the net profit of banks (after tax) in January-August 2024 amounted to UAH 106.1 billion, which is 11.6% more than in the same period last year, and state-owned banks account for the lion’s share of this result.
Prospects for privatization
Despite the stable financial performance, the Ukrainian government has been planning to reduce the state presence in the banking sector for many years. The privatization process has been repeatedly postponed due to various circumstances, including economic instability, war, and the difficulty of valuing large banking assets. Now the government is again considering selling stakes in some state-owned banks, which could be an important step in reforming the banking system. And even more importantly, in the context of IMF requirements.
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