OREANDA-NEWS. On 09 February 2009 the NBU announced its Resolution #33, stating that the commercial banks are allowed to take NBU’s overnight loans not more than 10 times per month if the loans are backed by the government bonds or certificate of deposits. The loans without any collateral are to be provided not more than 8 times per month. The amount of the loans cannot exceed 60% of the bank reserves, if they are secured and 40% otherwise. The Resolution has been implemented since 1 February 2009.

Millennium Capital considers that this step of the NBU aimed to force the commercial banks to sell excess foreign currency, which is accounted on their balance sheets and was bought in October-December 2008 with the speculative purposes. Currently excess foreign currency restricts the liquidity of the commercial banks, required to be denominated in the national currency, thus making the commercial banks to maintain their short-term liquidity via the overnight loans of the NBU. Therefore, the resolution implementation will cut off the free access to the overnight loans by the commercial banks and may increase the foreign currency supply.

Millennium Capital is an integrated financial services provider. Established in 2000 by a group of professionals with solid background in securities and corporate finance, Millennium Capital is now one of the major investment banking institutions.