Ukraine’s banks still the economy’s weakest link

It looks like Ukraine’s banking sector has withstood the political crisis in better shape than we had feared. Credit conditions are likely to tighten sharply over the coming months, but a messier outcome seems to have been averted. Recent progress towards securing external financial support from the IMF/EU should reduce this risk further. But if this financing is delayed or the political crisis escalates, the banking sector could still prove to be the economy’s weakest link.