Local court dismisses reprimanding of two deputy NBU governors

Kyiv District Administrative Court ruled on April 2 to
declare illegal and cancel the decision of the Council of the National Bank of
Ukraine (NBU) to reprimand deputy NBU governors Kateryna Rozhkova and Dmytro
Sologub, nv.ua news site reported on April 21. The NBU told Interfax-Ukraine
the same day that it had already filed an appeal to the court’s ruling.

Recall, the two deputy governors were reprimanded
in October, which followed scandals in the NBU executive board. Rozhkova
and Sologub are the only two NBU board members (of six total) who preserved
their positions after the board reshuffle that started in July with the resignation of NBU
governor Yakiv Smoliy.

Alexander Paraschiy: The recent events show that there is still a poor climate in the NBU’s
executive board. Luckily, this does not affect the NBU’s independence in its
monetary policy, as is suggested by the regulators’ recent decision to hike the key rate
by 1pp. However, the apparent
conflict among NBU top managers diminishes its image in the eyes of Ukrainians,
which, among other effects, could limit the psychological impact of NBU’s
decisions on inflation expectations.