National Bank of Ukraine releases Q1 2026 Bank Funding Survey showing banks expect deposits to grow and become more expensive

The National Bank of Ukraine published the Q1 2026 Bank Funding Survey, showing that banks saw overall funding volumes fall in Q1 while the average cost of liabilities rose, and they expect both the volume and cost of funding to increase in Q2. Business deposit volumes declined in Q1, while household deposits edged up. The average cost of funding increased mainly due to household deposits, with business deposit costs slightly lower and wholesale funding costs unchanged. Respondents expect liabilities to rise in Q2 across household and business deposits and wholesale funding. Almost one-third of banks by share of assets plan to raise wholesale funding, largely from the EU and international financial institutions and earmarked for recovery projects. Overall funding costs are expected to increase on higher interest rates for both business and household deposits, while wholesale deposit pricing is projected to remain steady. The foreign-exchange share of funding expanded, but banks expect it to shrink in Q2. Funding maturities lengthened for a fourth consecutive quarter and are projected to keep increasing over the next 12 months. Most banks reported higher total capital over the past year and, for the first time since late 2024, a decline in the cost of capital, which they expect to continue. The survey was conducted from 17 March to 7 April 2026 among liability managers at 25 institutions representing 96% of banking system assets, and the results reflect respondents’ views rather than National Bank of Ukraine assessments or forecasts. A survey covering expectations for Q3 will be released in July.