Ukraine launches non-banking sector reform with EU support
15 May 15:44
The European Union is launching a new twinning project to support the National Bank of Ukraine in effective supervision of non-bank financial institutions. This was reported by "Komersant Ukrainian" with reference to the official website of the NBU.
The financial institution says that despite the full-scale war, Ukraine’s financial system continues to operate stably. This is also confirmed by the new international Twinning project, which started on May 14, 2025. It should help adapt the Ukrainian financial sector to EU standards.
What is the project about?
The project is funded by the EU and aims to support the non-banking financial sector – insurance companies, credit unions, payment services, etc. Its goal is to train Ukrainian specialists to identify risks in the work of companies, prevent problems in the market, and attract new sources of funding for the post-war economic recovery.
Who is involved
Regulators from Poland, Lithuania, and Spain have joined the project. Among them:
- Polish Financial Supervision Authority (UKNF),
- Bank of Lithuania (Lietuvos bankas),
- Spanish Insurance and Pension Funds Regulator (DGSFP),
- FIIAPP International Foundation.
The project involves developing new methodologies, training Ukrainian inspectors, and creating tools for effective control over companies – all in line with EU legislation.
What the participants say
NBU Governor Andriy Pyshnyi emphasized that Ukraine’s goal is to integrate into the EU as soon as possible. And the new project is an important step in this direction.
Ukraine has set itself an ambitious goal of becoming a member of the European Union as soon as possible. I am convinced that the dynamic exchange of knowledge and experience with our partners from EU member states within this new Twinning project will be an invaluable support to this process, in particular in further advancing non-banking financial sector reforms,” said Andriy Pyshnyi.
Henrik Huitfeldt, EU Delegate to Ukraine, noted the following:
“Non-banking institutions are key to economic resilience during and after the war. Harmonization of rules with the EU is the basis for recovery and further integration.
Partners from Lithuania and Poland also expressed confidence that their experience would be useful for Ukraine, as they themselves have gone through the process of adapting to EU norms.
Today’s launch of the Twinning Project opens a new chapter in our strategic partnership. We are not just exchanging technical knowledge – we are creating a joint financial security network that will support us in the next financial crisis. Each joint development between Vilnius and Kyiv is a part of this network that makes our financial systems not only compliant but also truly resilient,” said Mr. Gediminas Šimkus, Chairman of the Board of Lietuvos bankas.
Javier Castillo Garcia, Deputy Director General for Regulation and International Relations of the DGSFP, emphasized that the regulator fully supports this project and will gladly share the knowledge of its experts.
“All short-term experts are insurance inspectors with extensive international experience and have already participated in similar initiatives,” assured Javier Castillo Garcia.
Why it is important
This project is not just about technical assistance. It is support for Ukrainian financial reforms, particularly during the war. It will help build a modern, sustainable financial system that will meet EU standards and be able to withstand new challenges.
The project will last for several years and already covers specific tasks: introducing new risk assessment methods, strengthening supervision, and training. All this will bring Ukraine closer to the European financial community.
What is twinning?
Twinning is an instrument of the European Union used to support institutional reforms and capacity building in countries that are candidates for EU membership or closely cooperate with the EU. It works by bringing together (or “twinning”) public institutions in beneficiary countries with their counterparts in EU member states to share experience, knowledge and best practices.
Twinning is seen as a practical and politically neutral tool to support reforms, especially in countries on the path to EU membership.
Key features of twinning
- Cooperation between governments. It is not outsourced to private firms; only public authorities or authorized bodies of EU member states can be lead partners.
- Focus on public administration reform. Areas include finance, justice, agriculture, health, education, etc.
- Focused on achieving specific goals. Twinning projects are designed to help implement certain parts of EU legislation (acquis communautaire) or improve institutional effectiveness.
How it works
The beneficiary country (e.g. Ukraine) identifies the area of reforms in which it needs assistance.
The EU country applies for the project through the relevant government agency (e.g., central bank, ministry).
The project manager and a permanent EU advisor work directly with the local institution for two years. Cooperation includes training, drafting regulations, implementing new systems, and on-site mentoring.
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