Bank Lending in Ukraine: Current Status and Challenges

The article examines the role of credit in the economy and identifies the main advantages of using borrowed capital to finance the working capital of an enterprise. It is established that credit is a balanced source of working capital formation and provides normal conditions for economic activity. It is investigated that the COVID-19 pandemic and the introduction of martial law in Ukraine have led to a reduction in public consumption, the suspension of some investment projects and a deep recession in all areas of economic activity, which has affected the state of bank lending to enterprises. The article examines the main trends in the functioning of the banking sector, in particular, the reduction in the number of banks and the significant increase in the role of banks with foreign capital in Ukraine. The structure of bank lending is studied. It is found that the main share of lending is occupied by loans to economic entities. A correlation-regression model of influence of the main factors on the state of bank lending in Ukraine is developed, and the influence of the main factors on the state of bank lending in Ukraine is estimated.