scholarly journals ВИЗНАЧЕННЯ ГЛИБИНИ КРИЗОВИХ ЯВИЩ БАНКІВСЬКИХ УСТАНОВ ТА РОЗРОБЛЕННЯ АНТИКРИЗОВИХ ЗАХОДІВ

2020 ◽  
pp. 65-75
Author(s):  
Марина Сергіївна Татар ◽  
Ольга Михайлівна Козловська
Keyword(s):  
Financial Stability ◽  
Banking Crises ◽  
Functional Integral ◽  
Comprehensive Approach ◽  
Capital Adequacy ◽  
Practical Significance ◽  
Bank Capital ◽  
Financial Activity ◽  
Functional Integral Method ◽  
Is Development

In the current economic environment, due to economic and political instability, a large number of banks are unable to adequately respond to changes of external and internal environment, which can lead to crisis situations, so the problem of identifying patterns and causes of banking crises, as well as identifying opportunities to overcome them relevant. The aim of the research is development of theoretical and methodological provisions on the patterns of occurrence of banking crises and development practical recommendations on the use of methods and tools that can prevent and overcome crisis phenomena. The subject of the research is the regularity of the occurrence of banking crises and the implementation of the mechanism of banks anticrisis management. The methods of the research: analysis, synthesis, abstract and logical, comparative and statistical, generalization and grouping; structural, functional, integral method, etc. The hypothesis of the research. There is a need for differentiation of anti-crisis measures depending on the level of bank crisis state. The statement of basic materials. Factors of occurrence of banking crises are classified. The comprehensive approach to the diagnosis of crisis phenomena in the financial activity of banks has been developed. It is determined that in selecting the criteria and indicators for identifying the bank crisis state, differentiated approach should be used, which is based on the proposed system of indicators, which should reflect the level of bank capital adequacy, liquidity, financial stability, business activity, profitability and efficiency indicators of bank profitability and efficiency so the most important indicators of bank's activity. Preventive and reactive measures in the anticrisis management system of banks depending on the level of the crisis state are proposed. The originality and practical significance of the research is development a comprehensive approach to crisis diagnosis in bank operations on the bases of publicly available data obtained from the published financial statements of the bank. Conclusions and perspectives of further research. Crisis phenomena were diagnosed in the activity of PRAVEX BANK JSC, the complex of preventive and reactive measures of anti-crisis management of banks financial activity was developed, which is a set of methods and instruments aimed at achieving certain target targets, formulated according to crisis stage and depth.

scholarly journals INTERNATIONAL STANDARDS FOR BANK CAPITAL REGULATION

2021 ◽  
Vol 1 (36) ◽  
pp. 35-45
Author(s):  
V. Kovalenko ◽  
S. Sheludko ◽  
N. Radova ◽  
F. Murshudli ◽  
K. Gonchar
Keyword(s):  
Financial Crisis ◽  
Economic Crisis ◽  
Financial Stability ◽  
International Standards ◽  
Capital Adequacy ◽  
Capital Regulation ◽  
Bank Capital ◽  
Banking Supervision ◽  
New Paradigm ◽  
Bank Capital Regulation

The paper analyzes the evolution of the introduction of international standards for bank capital regulation. The aim of the research is to study international standards for bank capital regulation and their impact on financial stability and sustainability of domestic banking systems. The 2007—2009 Global Financial Crisis was perhaps the greatest banking and financial crisis since bank failures and the financial panic of the Great Depression in early 1930s. According to academics and professionals, there has been much debate over the last decade as to whether the 2007—2009 banking crisis was primarily a solvency crisis or a liquidity crisis. Capital adequacy of banks today is the main indicator of increasing society’s confidence in banking systems. The flexible and balanced implementation of Basel Committee on Banking Supervision (BCBS) recommendations on the assessment of bank capital adequacy is of particular importance in the context of the deepening economic crisis caused by COVID-19 quarantine restrictions. Regulation of bank capital is primarily settles by the ability to execute basic functions inherent in it. A number of shocks in connection with the crisis require the renewal and search for a new paradigm of regulation, which today is focused on achieving financial stability, overcoming pro-cyclicality, especially in the banking sector. One of the latest developments in the field of bank capital regulation has been the implementation of international banking supervision standards recommended by BCBS, which have been transformed from Basel I, Basel II, Basel III, Basel 3.5 to Basel IV. The new ideology suggests that in times of financial and economic crisis or in anticipation of growing uncertainty in the economy, it is necessary to abandon the idea of bank capital management and the creation of financial reserves to maintain liquidity and stability of financial institutions. These measures will not be able to protect the bank from default and bankruptcy. This ideology has become a new paradigm of effective banking regulation, which can be formulated as an accepted set of three vectors: risk; risk management; risk-oriented supervision.

scholarly journals Peculiarities of ensuring financial sustainability of the Ukrainian banking system

2018 ◽  
Vol 13 (1) ◽  
pp. 184-195
Author(s):  
Olha Vovchak ◽  
Viktoriia Rudevska ◽  
Roksolana Holub
Keyword(s):  
Commercial Banks ◽  
Financial Stability ◽  
Banking System ◽  
Developed Countries ◽  
Equity Capital ◽  
Capital Adequacy ◽  
Financial Sustainability ◽  
Bank Capital ◽  
Strategic Objective ◽  
Capital Ratios

Ensuring and strengthening the financial sustainability of banks is a difficult and not completely resolved task. It is inherent not only to developed countries, it has also be¬come nationally important in Ukraine, which was largely predetermined by the specifics of the domestic banks development. This is explained, in particular, by the banking insti¬tutions’ focus mainly on the relatively short-term activity, the need to work under high risk, resulting from economic and political instability in the country. Therefore, nowa¬days, it is urgent for each Ukrainian bank to focus on the main strategic objective – effec¬tive management and ensuring financial sustainability. The purpose of this study is to assess the current state and identify the features of ensuring financial sustainability of the banking system of Ukraine.It was pointed out in the study that the negative tendency to increase the number of in¬solvent commercial banks during 2012–2017 indicates problems with providing finan¬cial sustainability to commercial banks. The tendencies have been revealed that testify to the problems of the banking system capitalization in Ukraine, which greatly affects its financial stability. Given the analysis of indicators of banks financial sustainability that characterize the bank capital adequacy, the conclusion is made on ambiguous as¬sessment of sufficient level of capitalization, since despite the correspondence of most values of coefficients to the indicators, there is a lack of capitalization of the domestic banking system and equity capital concentration. In general, the results made it pos¬sible to identify trends in the development of capital ratios and financial sustainability indicators and to shape appropriate measures to increase the level of capitalization in order to ensure the financial sustainability of the banking system.

scholarly journals TRANSFORMATION OF BANKS’ RISK MANAGEMENT SYSTEM AS A PREREQUISITE FOR ENSURING THEIR FINANCIAL STABILITY

2019 ◽  
pp. 56-63
Author(s):  
Svitlana Borysivna Yehorycheva ◽  
◽  
Oksana Sergiivna Vovchenko ◽  
Keyword(s):  
Risk Management ◽  
Management System ◽  
Financial Stability ◽  
Banking Sector ◽  
Global Financial Crisis ◽  
Perspective Transformation ◽  
Capital Adequacy ◽  
Practical Significance ◽  
Risk Management System ◽  
The Global Financial Crisis

Urgency of the research. The importance of the problem of ensuring the financial stability of banks has grown significantly after the global financial crisis, and in Ukraine it has become relevant again since 2014. The situation of economic turbulence has led to a radical revision of the determinants of financial stability, as well as conceptual approaches to risk management of the bank. Target setting. Currently, the banking sector is on the verge of implementing internal capital adequacy assessment procedures (ICAAP), which determines the practical significance of substantiating the areas of improvement of the bank's risk management system. Actual scientific researches and issues analysis. Problems of bank’s risk management are revealed in the works of T. Vasylieva, V. Kovalenko, N. Tkachenko, N. Shulga and others. Methodological principles of ensuring the financial stability of the bank in conditions of uncertainty are reflected in the works of O. Kolodizev, N. Pogorelenko, T. Unkovskaya, M. Khutorna, I. Chmutova and others. Uninvestigated parts of general matters defining. Further research is needed on the functioning of the bank's risk management system, substantiation of key requirements, compliance with which would serve as a guarantee of financial stability of the bank in different conditions of the macroeconomic environment. The research objective. The purpose of the article is to substantiate the directions of perspective transformation of the bank's risk management system to ensure its financial stability. The statement of basic materials. The article stages the development of the bank's risk management system to substantiate the logic and determinants of further transformation of this system in order to enable long-term maintenance of its financial stability. Conclusions. The determinants of perspective transformation of the bank's risk management system in the aspect of ensuring financial stability are substantiated, which include: 1) spectrum of risks; 2) risk management priorities; 3) the complexity of the risk management methodology.

Bank Capital Adequacy in Australia

2012 ◽  
Author(s):  
Niamh Sheridan ◽  
B. Jang
Keyword(s):  
Capital Adequacy ◽  
Bank Capital

scholarly journals Capital structure and profitability: An empirical study of South African banks

2016 ◽  
Vol 14 (1) ◽  
pp. 8-19 ◽  
Author(s):  
Kudzai Raymond Marandu ◽  
Athenia Bongani Sibindi
Keyword(s):  
Capital Structure ◽  
Credit Risk ◽  
South African ◽  
Time Series Data ◽  
Emerging Market ◽  
Strong Relationship ◽  
Capital Adequacy ◽  
Series Data ◽  
Bank Capital ◽  
The Relationship

The bank capital structure debacle in the aftermath of the 2007-2009 financial crises continues to preoccupy the minds of regulators and scholars alike. In this paper we investigate the relationship between capital structure and profitability within the context of an emerging market of South Africa. We conduct multiple linear regressions on time series data of big South African banks for the period 2002 to 2013. We establish a strong relationship between the ROA (profitability measure) and the bank specific determinants of capital structure, namely capital adequacy, size, deposits and credit risk. The relationship exhibits sensitivity to macro-economic shocks (such as recessions), in the case of credit risk and capital but is persistent for the other determinants of capital structure.

scholarly journals Dynamics of Risk Factors Affecting the Capital Adequacy Ratio with Special Reference to UCO Bank

2019 ◽  
Vol 8 (2) ◽  
pp. 10-13
Author(s):  
Preeta Sinha ◽  
Protik Basu
Keyword(s):  
Market Risk ◽  
Capital Adequacy ◽  
Basel Iii ◽  
Bank Capital ◽  
Financial Reports ◽  
Factors Affecting ◽  
Operational Risks ◽  
Capital Adequacy Ratio ◽  
Using Data ◽  
Asset Quality

To reinforce the stability of the financial system, policy makers and the Basel committee have proposed Basel accord to ensure that financial institutions maintain sufficient capital buffers. Basel III framework emphasizes on sustained increase in bank capital in order to absorb the potential credit, market and operational risks. The capital adequacy requirement under Basel III norms are directly linked to the PCA (Prompt Corrective action) framework which has disrupted the flow of credit in the economy. Market risk, Credit risk, Operational risk and deposits are some of the factors affecting the capital adequacy ratio (CAR) which influences the bank performances. This study aims at analysing the most important factor responsible for the shrinking liquidity due to adherence of stringent capital adequacy ratio imposed by RBI. Currently 11 public sector Banks out of 21 PSUs under PCA has sequentially shrunk their loan book including UCO Bank. The bank’s asset quality has worsened over the years. Using regression analysis, this paper seeks to study the major determinants of Capital Adequacy ratio using data sets for the period from 2009 to 2018 of UCO bank. The data was collected from the financial reports of the UCO bank for the aforesaid period. Among the parameters considered, it was found that deposits affect the CAR the most and market risk has the lowest impact on CAR.

scholarly journals Effects of Basel III Framework on Capital Adequacy of Commercial Banks in Kenya

2016 ◽  
Vol 1 (1) ◽  
pp. 61
Author(s):  
Kevin Kombo ◽  
Dr. Amos Njuguna
Keyword(s):  
Risk Management ◽  
Credit Risk ◽  
Commercial Banks ◽  
Financial Stability ◽  
Safety Net ◽  
Capital Requirements ◽  
Capital Adequacy ◽  
Basel Iii ◽  
Credit Risk Management ◽  
Management Staff

Purpose:The purpose of the study was toassess the effects of Basel III framework on capital adequacy requirement in commercial banks in Kenya. The study sought to address the following research questions: why are capital adequacy regulations important in commercial banks in Kenya? What challenges are commercial banks facing in the implementation of capital adequacy requirement? What measures have commercial banks taken to ensure compliance with the capital adequacy requirement?Methodology:A descriptive survey design was applied to a population of 43 commercial banks operating in Kenya. The target population composed of the 159 management staff currently employed at the head offices of the various commercial banks in Kenya. The population was composed of Senior, Middle and Junior or Entry level Management staff. A sample of 30% was selected from within each group.Primary data was gathered using questionnaires which were dropped off at the bank’s head offices and picked up later when the respondents had filled the questionnaires. Descriptive analysis was used to analyze quantitative data while content analysis was used to analyze qualitative data.Results:The findings show that capital adequacy requirement is important in commercial banks because it leads financial stability in the Kenyan economy, improves credit risk management techniques as poor credit risk management requires more capital and leads to reduced vulnerability to liquidity shocks due to the sound capitalization policies being implemented under the Basel III framework. Findings also revealed that capital adequacy affected the balance sheet structure of the commercial banks in Kenya.Unique contribution to theory, practice and policy: The study recommends that banks should continue the pursuit of various strategies to ensure that they are in compliance with Basel III requirements and the Central Bank of Kenya’s Prudential Guidelines. The staff of this committee should be drawn from mainly the finance, legal, compliance and treasury departments. Compliance with the capital requirements will lead to a safety net for all commercial banks as the additional capital will act as a cushion that absorbs losses in case of distress in the commercial banking sector.

Asset correlations and bank capital adequacy

2013 ◽  
Vol 19 (1) ◽  
pp. 55-74 ◽  
Author(s):  
Giampaolo Gabbi ◽  
Pietro Vozzella
Keyword(s):  
Capital Adequacy ◽  
Bank Capital
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