Financial Stability of the Banking Sector and Security of the Backbone Bank Activites in the Exchange Market in the Context of National Ability to Implement the European Green Deal

Abstract

The article consistently grounds that a collision of the existing economic model with financial-economic, social-and-food and institutional challenges generated by the COVID-19 pandemic jeopardizes achieving the nationally prioritized Sustainable Development Goals by 2030, in particular, associated with the anti-crisis reaction to an imbalance of nature management, ecology, sustainability of formation of agricultural valued-added chains as well as enroots a lag of the national regulating financial-and-economic system behind the New Green Deal chosen on a planetary scale and on the European continent – the European Green Deal. To neutralize this crisis gene, the article grounds the need not only to develop respective concepts, strategies, programs, approaches to the economic stimulation and budgetary financing, but also determines crying reality – low activity of the banking sector as a financial donor in implementing respective measures for achieving national “green” goals, in restructuring the economy due to high volatility of current processes. This crystallized the subject of research – a role of the banking sector in the formation of the national ability to implement the European Green Deal through the lens of financial sustainability, security of its activities in exchange markets. As first methodological steps, symbiotics is offered, putting together traditional tools of scientific research with a non-orthodox combination of material and computational financial-and-economic experiments allowing to conduct targeted research – the state of the banking sector of the country and security of activities of one of the backbone banks – PrivatBank, in general, and in the exchange market, in particular. It was proved that the lack of synchronicity of the regulation of the European Green Deal, Ukraine’s Green Deal and a methodological basis of financial stability, in general, and macro-prudential policy, in particular, has generated information asymmetry in assessing the potential of the banking sector to provide normative regulations in the “greening” of sectors of the national economy. In this context, the Ministry of Energy and Environmental Protection of Ukraine presented, at the beginning of 2020, a draft Concept of “Green” Transition of Ukraine until 2050, which implementation will take place using financial instruments tested within the framework of “warm” loan programs carrying new opportunities for the PrivatBank’s participation in the “greening” of the national economy including that by crediting projects of complex thermo-modernization of both multi-apartment and individual houses. As a result of implementing the Green Deal, the economy of Ukraine will drastically change, new sectors, new industries will appear within the framework of the traditional rural economy and environmental economy while a link between the economic growth, on the one hand, and resource consumption, environmental contamination, greenhouse gas emissions, on the other hand, will be broken. In this context, in order to maintain own leading positions in the segment of the regulatory providing and financing of modernization of small and medium business in the direction of its “greening”, the PrivatBank needs to immediately actualize the provisions of its strategy until 2022, subject to new market segmentation, prioritization of recipients of loans, their channeling, first of all, for the needs of the “green” modern.

Green Economy and Green Finance in the Context of the Problems of Sustainable Rural Development

“…Since the middle of the last decade, a number of European Union member states, as well as the United States and Japan, have experienced the peak energy consumption both in industry as a whole and in agriculture. As a result, the share of coal and oil consumption in the fuel and energy balance of these countries began to decline noticeably, and renewable energy sources were a segment of energy consumption that began to grow significantly [1]. The use of solar and wind energy has increased in almost all countries.…”