International Banking in Ukraine: Determination, Genesis and European Vector

ANNOTATION. The Covid-19 pandemic and the war in Ukraine have contributed to a slowdown in banking internationalisation, but the growing trend of emerging markets towards international capital movements, technological innovations in the financial sector, and sustainable trade relations is increasing the relevance of international banking research in Ukraine. Based on an analysis of the historical overview of views on global banking in the last decades of the twentieth and first decades of the twenty-first century, the article defines the definitional features of international banking. The article emphasises the importance of foreign competition for the domestic banking sector. In this sense, a retrospective analysis of the entry of foreign banking capital into the domestic market of Ukraine is carried out and the strategies of foreign banks' penetration and forms of their presence are identified from the point of view of the evolution of the banking system development and transformation of the regulatory environment in Ukraine. The author notes the impact of the European integration vector on the intervention capabilities of international banks in the domestic market and the entry of domestic participants into the European market, and outlines the reaction of the financial system to the resulting internal and external shocks. As part of the overall transformations aimed at bringing Ukraine's accession to the EU closer, the author notes that the entry of foreign banks results in the introduction of new financial products and instruments, with a special focus on the convergence of the regulatory regime based on a harmonised set of prudential requirements and the concept of equivalence. It is noted that the domestic banking sector today, given all external and internal challenges and threats, has significant reserves in terms of capitalisation, and foreign banks are its support, and the author substantiates the need to continue an effective policy of foreign capital attraction in compliance with EU requirements and standards.