The National Bank of Ukraine upgrades the procedure for holding the exchange buy sell auction. The relevant amendments are approved by the Resolution of the Board of the National Bank of Ukraine dd. 01/10/2015 №655 on Introduction of amendments to the resolution on holding FX auctions by the National Bank of Ukraine, the NBU press-service reports.

Up to now the regulator had to announce holding auctions beforehand. The upgraded resolution in its turn stipulates the announcement of auction not only beforehand, but also on the day of its holding. This will enable NBU to promptly response to occurring disbalance on FX market. As previously, the auction announcement and its conditions will be forwarded via e-mail.

The resolution also distinguishes terms for competitive and non-competitive bids. If the competitive bid includes the certain UAH against foreign currency exchange rate, then in the non-competitive bid the UAH to foreign currency exchange rate is not specified. Consequently, the non-competitive bid gives the opportunity to buy and sell currency on the auction, emphasizes the director of NBU Open Market Department Sergei Ponomarenko. In particular, the competitive bids will be satisfied at the cutoff rate or at the rate, quoted by market players. And the non-competitive bids will be satisfied at the rate, which is calculated as average-weighted rate on all satisfied competitive bids.

In the meantime the upgraded resolution increases banks’ responsibility for completion of bids, submitted for participation in the auction. The bank, the bid of which was selected by the National Bank for satisfying at the auction, is obliged to conclude the agreement with National Bank on foreign exchange sale and purchase and confirm the deal via System for Confirmation of Deals in Ukraine’s Interbank Foreign Exchange Market. The bid cannot be retracted. The banks violating the regulation will be excluded from participation in next three auctions.

The amendments come into force from October 3, 2015.