Retail growth focuses Ukraine’s funding needs

Banks have been profiting from a rising tide of consumer borrowing. As increasing bank intermediation offers plenty of loan growth, a mismatch in assets and liabilities puts pressure on banks to come to the international capital markets and make use of more sophisticated funding. Florian Neuhof reports from Kiev.

INDEPENDENCE SQUARE IN Kiev is a site of historical importance. It is where Ukraine’s democracy came of age when demonstrators gathered to protest against the rigged election of 2004 in what became known as the Orange Revolution. These days, Ukrainians have shifted their attention elsewhere. The square is near-deserted at most times, but the shopping mall in a vast cavernous space underneath is buzzing with activity.

This is indicative of the spending frenzy that has gripped consumers, the result of a growing economy and a rise in disposable income.

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