Page 103 - Azerbaijan State University of Economics

THE JOURNAL OF ECONOMIC SCIENCES: THEORY AND PRACTICE

Elaboration of financial stability provision issue in Ukraine has begun quite

recently. More significant progress was reached in development of issue of financial
security of state. Currently key principles and definitions, covenants, subjects and objects

in safeguarding of financial security of state are identified by Ukrainian low (The

Constitution of Ukraine, Law of Ukraine “On Principles of National Security of Ukraine”,
National Security Strategy of Ukraine, Military Doctrine of Ukraine, Law of Ukraine “On

the Foundations of Domestic and Foreign Policy”). However, there is still no clear
understanding of the concept of financial stability.

That is why the most actions of regulatory policy are mainly
situational and focused on addressing the current imbalances of

development, there are shortcomings in the coordination of actions of

regulators, also there is no system to ensure financial stability and macro-
prudential regulation. Government regulation in these matters is unclear to

the public and unpredictable, adversely affecting the level of trust to

regulatory policy in the financial sector.
However, interest for the problem of the financial stability

development from year to year is fueled by financial disasters and their
increasingly negative impact on the domestic economy. Hence, crucial

requirements for the banking system and the institutional ability of regulators
to ensure the smooth functioning of the financial system have occurred.

Consequently, the solution of the financial stability provision issue is of great

importance for Ukrainian.
Given the positive experience of Western countries in assignment of

responsibilities for financial stability to the monetary authorities, we have examined
activities of the National Bank of Ukraine and evaluated the effectiveness of

monetary regulation in achieving financial stability.
Based on systematization and analysis of legal documents governing

the status and activities of the National Bank of Ukraine, we have reasons to

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