NBU cancels interest rate restrictions on long-term borrowing by Ukrainian banks

The National Bank of Ukraine canceled the upper interest rate limit for long-term borrowing by Ukrainian banks (terms of over one year) on external markets. The decision will come into effect on October 27. According to an NBU representative, the upper interest rate limit on loans for over one year is currently 11%. Сoncorde Capital: This regulation, technically, should aid second-tier banks in attracting foreign debt, though global market conditions still make the process difficult. This measure might help strengthen the structure of Ukraine’s external debt toward longer-term instruments. As of 1H08, 28.2% of Ukraine’s external debt was short-term.