PUBLIC SECTOR BANKS: FINANCIAL POTENTIAL IN POST-WAR ECONOMIC RECONSTRUCTION

Abstract

Introduction. In a state of war, public sector banks play a strategic role in the country's economy, ensuring financial stability and supporting the real sector. The dominance of the public sector in the banking system creates risks of market monopolisation, which raises the issue of justifying ways to reform the public banking sector and adapt it to European standards in the context of post-war economic recovery.

Purpose. The aim of the study is to assess the financial potential of public sector banks based on an analytical study of key financial indicators, market indicators and potential risks, as well as to justify conclusions regarding further reform of the banking sector.

Materials and methods. The methodological basis of the study is the fundamental principles of economic theory, financial theory and the concept of banking business development. The study uses methods of analysis and synthesis, systematisation and grouping, induction and deduction, and comparison.

Results. The dynamics of financial indicators of the activities of state-owned banks in Ukraine in 2022–2025 were analysed. A qualitative strengthening of the positions of state-owned banks as stabilisers of the financial system, demonstrating high resistance to military shocks, was revealed. Significant growth in the deposit base, capital accumulation, expansion of lending to the real sector, reduction in non-performing loans and high profitability confirm the effectiveness of state banks and the regulatory measures of the NBU. It has been substantiated that state-owned banks are a strategically important component of the country's financial system, combining commercial principles with the implementation of state economic policy, thereby increasing the financial potential for post-war economic reconstruction.

Discussion.  Further research should focus on determining the strategic prospects for the privatisation of state-owned banks, which, although they remain a key instrument of post-war economic reconstruction, require further improvement and a gradual reduction in the state's share in line with the strategy for reforming Ukraine's banking sector.