INTERNATIONAL EXPERIENCE OF BANKING SUPERVISION AND WAYS OF ITS ADAPTATION IN UKRAINE

Abstract

The article analyzes the international experience of organizing banking 
supervision, including the US and UK models, which combine centralized 
coordination, decentralized expertise, a risk-based approach, stress testing, and 
technological support for control. In the US, the distributed supervision system 
includes the Federal Reserve, OCC, and FDIC, which allows for the accumulation of 
specialized knowledge and stimulates competition in expertise, while creating 
challenges for coordination and unification of procedures; after the 2008 crisis, 
interagency mechanisms for information exchange were strengthened, corporate 
stress tests were introduced, and the Financial Stability Board was created. In the 
UK, prudential supervision combines systemic risk assessment and in-depth 
individual expertise, applying professional judgment to interpret indicators, 
differentiating requirements depending on the systemic importance and scale of 
banks, and maintaining an ongoing dialogue with management to proactively 
resolve problems. Based on these practices, an improved model of banking 
supervision in Ukraine has been proposed, which integrates the assessment of the 
financial stability and integrity of banks, automated data collection and analysis, 
standardized indicators and early warning mechanisms, and transparent response 
procedures; ensures risk-based supervision; andmacro- and microprudential 
measures. The central coordinator of the system is the National Bank of Ukraine, 
which establishes uniform supervision standards, organizes stress testing, 
accumulates data, and carries out monitoring, while delegating some of the 
functions to specialized bodies—the Deposit Guarantee Fund, the State Financial 
Monitoring Service, the Ministry of Finance, and other participants – which 
combines the advantages of centralized coordination and decentralized expertise, 
minimizing duplication and fragmentation. The system involves the use of common 
analytical platforms for standardized reporting, automated analysis and formation 
of early warning indicators, integration of money laundering and terrorist financing 
risk assessment into a common supervisory profile, and also includes mechanisms 
for two-way information exchange and feedback between regulators and banks. 
The lower level of the model consists of banks that carry out internal control, risk 
management, and reporting, as well as external auditors and a banking ombudsman 
for independent assessment and protection of consumer rights. The model ensures prompt identification and minimization of systemic risks, increases depositor 
protection, stimulates transparent communication with the market, and promotes 
trust in the banking system. The conclusions show that the adaptation of 
international practices, taking into account national characteristics, resources of 
regulatory authorities, and the legal environment, allows the creation of an 
effective, stable, and flexible supervisory system that is able to ensure the stability 
of the financial system, maintain a balance between centralized control and 
specialized expertise, and integrate technological solutions to increase the speed 
and quality of monitoring.