Abstract:

This article focuses on the cost to income ratio as an important measure describing the cost-effectiveness of banks. The article is a continuation of the research presented in the article Financial situation of the banking sector in Ukraine in 2013-2018 from the point of view of changes in selected financial indicators of key Ukrainian banks. The purpose of this article is to assess the cost-effectiveness of selected 15 leading banks in Ukraine in 2013-2018. The hypothesis adopted for the research is: cost effectiveness of leading banks in Ukraine, measured by the C/I ratio is negatively related to bank profitability in the period 2013-2018. This hypothesis is justified by linking the political and economic situation of Ukraine with the results of the effectiveness of banks. The research presented in the article confirm the hypothesis. The cost to income ratio is negatively correlated with both ROE and ROA indicators. The only exception is 2015, when the C/I and ROE correlation was positive. The reason for this can be seen in the political and economic situation shortly after the outbreak of the conflict in Donbas.