Page 47 - Ukraine OUTLOOK 2024

clothing stores, opened its first store in Ukraine in 2018. At the beginning of the full-scale invasion, the H&M chain in Ukraine consisted of eight retail outlets: five in Kyiv, one each in Odesa, Kharkiv and Lviv.
On December 1, the largest shopping centre in Kyiv re-opened, and market participants state that the economic situation in Ukraine has stabilised. Blockbuster Mall, with 100,000 square metres of innovative space, will reopen on December 1. As the director of the mall said, retail has not yet returned to pre-war indicators, but there is a shift in turnover and demand from tenants who are ready to invest in new stores, goods and marketing.
• 6.5 Banking sector
The banking system remains operational and liquid, and very profitable.
Thanks to a comprehensive clean-up of the banking sector that was completed well before the start of the war, banks took the shock in their stride.
Ukraine's banking sector is one of the few profitable sectors in the country and earned all-time high cumulative profits in the first eight months of 2023 of UAH95.1bn ($2.5bn), according to National Bank of Ukraine (NBU) data.
Only three of the 20 largest Ukrainian banks need a capital increase. The NBU conducted a sustainability assessment for the 20 largest banks, which together account for more than 90% of the net assets of the country's financial sector. According to the sustainability assessment, only five banks have a higher than minimum level of capital adequacy standards, and only three have a risk of losing their capital completely in a three-year horizon.
Despite the slowdown the sector has been more profitable in 2023 than any time since the EuroMaidan revolution to the extent that in the fourth quarter the government imposed a special 50% profit tax on banks that will be reduced to 25% in 2024, as a way of generating more revenues for the military effort.
The Ministry of Finance anticipates that the tax will contribute significantly to government revenue, estimating a boost of UAH24-25bn ($650mn) in the budget for 2023 alone. In the years that follow, this annual contribution is projected to stabilise at UAH6-7bn.
47 UKRAINE OUTLOOK 2024 www.intellinews.com