FUNCTIONS AND TASKS OF THE NATIONAL BANK OF UKRAINE REGARDING FINANCIAL MONITORING

Анотація

This paper presents a systematic analysis of the functions and responsibilities of the National Bank of Ukraine in the field of financial monitoring, which plays a decisive role in safeguarding the transparency, resilience, and integrity of the national banking system. In a context marked by deepening financial globalization, rapid digital transformation, and the growing complexity of money-laundering and terrorist-financing risks, the institutional role of the National Bank of Ukraine as a regulatory and supervisory authority has considerably expanded. The study outlines the conceptual basis of financial monitoring in Ukraine and traces its development in line with international AML/CFT standards, including the FATF Recommendations, Basel Committee guidelines, and EU AML directives. Financial monitoring is defined as a multilayer mechanism aimed at identifying, preventing, and mitigating illicit financial activities through coordinated actions of primary and state monitoring entities. A central focus is placed on the National Bank of Ukraine’s regulatory, supervisory, analytical, and methodological functions. The institution formulates binding regulatory requirements, conducts risk-based supervision, enforces compliance measures, and maintains structured cooperation with the State Financial Monitoring Service of Ukraine and international AML/CFT bodies. The paper highlights the practical implementation of financial monitoring in banks, including KYC/CDD procedures, risk assessment models, suspicious activity reporting, and the increasing integration of RegTech and SupTech technologies. The research also identifies systemic challenges, such as regulatory ambiguities, shortages of qualified AML/CFT personnel, uneven digital maturity across banks, insufficient interagency coordination, cyber vulnerabilities, and emerging risks related to fintech innovations and digital assets. The paper argues for further harmonization of national legislation with AMLD5–AMLD6 and FATF standards, reinforcement of cybersecurity frameworks, and institutional development of professional certification (e.g., CAMS). Finally, the study proposes strategic directions for strengthening Ukraine’s AML/CFT system: establishing a unified state information-exchange platform, expanding training infrastructure, enhancing risk-oriented supervision, and deepening international cooperation. The paper concludes that a robust system of financial monitoring is not only a control mechanism but also a critical instrument of strategic financial governance, and that strengthening the mandate of the National Bank of Ukraine will facilitate greater trust, competitiveness, and integration of the Ukrainian banking sector into the global financial architecture.

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