Fitch Ratings has affirmed the long-term issuer default ratings (IDRs) of three major Ukrainian state-owned banks — Oschadbank, Ukreximbank and Sense Bank — keeping their foreign currency ratings at CCC and local currency ratings at CCC+, reflecting the continued high risk of default in the war-hit country’s banking sector, reported Ukraine Business News.

The rating agency said the decision underscores Ukraine’s highly challenging operating environment, dominated by the ongoing Russian invasion, macroeconomic volatility, and reliance on foreign aid. Fitch also assigned a short-term national currency rating of C to each of the three banks, signalling a heightened likelihood of liquidity strain under stress.

A similar action was taken with respect to ProCredit Bank Ukraine, whose ratings were affirmed at the same levels.

According to Fitch, the CCC long-term foreign currency rating reflects a high probability of default due to external financing constraints and exposure to sovereign risk. The CCC+ long-term local currency rating, one notch higher, indicates slightly lower regulatory risk and adequate liquidity buffers for domestic operations.

Oschadbank and Ukreximbank — both wholly owned by the state — play key roles in implementing government lending and reconstruction programmes. Sense Bank, formerly Alfa Bank Ukraine, was nationalised in July 2023 following sanctions against its former Russian owners.

Fitch noted that while the banks remain solvent and have maintained sufficient local liquidity, their ability to meet foreign currency obligations depends heavily on Ukraine’s external financing support and the stability of the domestic financial system.

Ukraine’s banking sector has remained resilient despite nearly three years of full-scale war, supported by capital controls, government backing and aid from international partners. However, rating agencies continue to flag elevated credit risks linked to the country’s fiscal pressures, currency volatility and uncertain outlook for post-war recovery.