scholarly journals EVALUATION OF RISKS RELATED TO RUSSIAN POWER GRID COMPANIES BY FOREIGN INVESTORS

2016 ◽  
pp. 158-166
Author(s):  
D. L. Valkova
Keyword(s):  
Risk Premium ◽  
Banking Sector ◽  
Foreign Capital ◽  
Power Grid ◽  
Investment Climate ◽  
Current Crisis ◽  
Foreign Investors ◽  
Industry Development ◽  
Increased Risk ◽  
The Impact

The article focuses on the impact of the current crisis on evaluation of risks related to Russian power grid companies by foreign investors as well as on prospects of raising foreign capital. The current situation resulted in a considerable deterioration of investment climate in Russia as well as in aggravation of industry-specific problems. Inflation growth, devaluation of the national currency, GDP decrease, drop in electricity consumption and the crisis in the banking sector negatively impact the investment profile of the country. This leads to increased risk premium for foreign capital investments in any type of Russian assets. At the same time industry-specific problems augmented as well. Those are primarily lack of transparency in regulation, which is subject to constant changes, growth in overdue receivables, limited access to modern technologies. All of the above had a considerable impact on the perception of Russian risks by international investors. A comprehensive approach is needed to improve the investment climate in the country and this would be largely defined by the general macroeconomic development of the Russian Federation and relations with other states. Consistent strategy and integrated actions of the Government and respective Ministries are of particular importance. As for the industry-specific factors, transparent and well-balanced long-term tariff system is the key condition for sustainable improvement of the situation in the sector, according to the major industry participants and leading experts. Thus, the article highlights changes in investor perception of the Russian power grid sector as well as relative impact on the industry development prospects. This analysis is the basis for further elaboration of recommendations regarding easing off of the crisis impact on the power grid companies as well as for assessment of prospects of meeting strategic industry development objectives.

scholarly journals The Vienna Initiative as an Example of Cross-Border Policy Coordination – Case of Bosnia and Herzegovina

2020 ◽  
Vol 18 (2) ◽  
Author(s):  
Dragan S. Jović
Keyword(s):  
Bosnia And Herzegovina ◽  
Industrial Production ◽  
Financial Stability ◽  
Banking Sector ◽  
Foreign Capital ◽  
Policy Coordination ◽  
Southeast Europe ◽  
Foreign Investors ◽  
Cross Border ◽  
Border Policy

At the very beginning of global economic and financial crisis, foreign capital started to withdraw from banking sector of Bosnia and Herzegovina. There was a huge danger that the domestic banking sector would suffer great instability due to high exposure to foreign investors. The big part of foreign funds was in the form of hot money, and the European banks highly exposed to Central and Southeast Europe had to act. EBRD and IMF launched a rescue plan aimed to slow down the deleveraging process and to preserve financial stability. The foreign banks promised that the pace of funds withdrawal would be accommodated to the preserving of home countries financial stability. The meeting about this issue was held in Vienna, which is an international banking hub for part of Central and especially for Southeast Europe. According to the meeting’s place, rescue plan got the name Vienna Initiative (VI). VI was a cross-border activity with the final aim to reduce systematic risks appeared because of the withdraw of foreign capital from BH banking sector. In this view, VI was specific m macroprudential tool for keeping financial stability. In addition, in a broader view, it was cross-border macroprudential policy coordination plan. For Bosnia and Herzegovina, the Vienna Initiative came in the right moment. Without VI it would be very hard or maybe even impossible for Bosnia and Herzegovina to preserve financial stability and to prevent the balance of payment crisis, and even currency crisis and banking crisis. Thus, in the case of BH, VI was very successful cross-border policy coordination due to the large exposure of domestic banking sector to the foreign investors. At the pick of crisis foreign liabilities of BH banking sector were 6 billion BAM (12/2008) i.e. 32,5% of total liabilities or 29% of total asset. All developed models show that foreign liabilities have a great influence on loans, deposits, and industrial production. The unexpected fall in foreign liabilities would have adverse and very strong effects on deposits, loans, and industrial production. All models show that foreign liabilities significantly affect economic and financial activity in Bosnia and Herzegovina. We used different techniques to show influences of foreign liabilities on domestic variables; Vector autoregression in level and in differences, Vector error correction model, Conditional VAR, and multiple regression models. All models show that in case of disorderly withdrawal of foreign funds, fall in industrial production, deposits, and loans would be much higher than in the case when VI is applied. The main conclusion of the article is that VI helped BH to avoid huge and long negative credit growth i.e. credit crunch, and to avoid deeper economic crisis.

scholarly journals Bank challenges in the context of the COVID-19 pandemic

2020 ◽  
pp. 119-124
Author(s):  
Zhanna Dovhan
Keyword(s):  
Financial Stability ◽  
Banking Sector ◽  
Banking System ◽  
Research Problem ◽  
Customer Engagement ◽  
Current Crisis ◽  
Virtual Communication ◽  
Analysis And Synthesis ◽  
Article Analysis ◽  
The Impact

Purpose. The aim of the article is highlighting the main problematic aspects of the activities of the subjects of the banking sector in the context of the COVID-19 pandemic. Methodology of research. The theoretical basis of the study is the scientific works of foreign and domestic scientists on the research problem. The following methods are used in writing the article: analysis and synthesis – in the study of foreign and domestic experience in identifying problems in banks provoked by COVID-19; settlement and analytical – in the analysis of the impact of crisis phenomena on the activities of banks; abstract and logical – in substantiating theoretical generalizations and conclusions. Findings. The problems of functioning of banks in the conditions of COVID-19 distribution are investigated. It is substantiated that the priority directions of changes in the current principles of the banking system are providing services through digital channels, credit risk assessment and management, use of a range of digital opportunities to increase customer engagement, implementation of the concept of working world 4.0, which provide for the development of quality management, which, in turn, includes interaction with its employees and the creation of rules for virtual communication. Originality. Measures to avoid the consequences of the coronary crisis for banking institutions, in particular to monitor corporate borrowers and develop a strategy for working with retail customers, taking into account the specifics of the current crisis, and by introducing additional warning signals characterizing borrowers' vulnerability to COVID-19 are proposed. Practical value. The obtained results of the study can be used for further scientific research on the development of ways to overcome the crisis in the banking system caused by the pandemic, as well as in the practice of banks to ensure their financial stability. Key words: bank, banking system, banking sector, manager, COVID-19, crisis, remote service.

scholarly journals Foreign Banks in China: Start of a New Stage

2021 ◽  
Vol 65 (6) ◽  
pp. 71-78
Author(s):  
A. Vdovin
Keyword(s):  
Development Policy ◽  
Banking Sector ◽  
Foreign Capital ◽  
Banking System ◽  
Foreign Banks ◽  
Stage Of Development ◽  
Recent Developments ◽  
The Impact ◽  
Development Prospects ◽  
Foreign Banking

Received 16.10.2020. The article examines the most recent developments in the evolution of the foreign banks in China. Author provides a brief description of the stages of development of foreign banks in the PRC since the start of the Den Xiaopin’s Reform and Development policy till the present time. The change in assets of foreign banks for the last 15 years is analyzed in details. A comparison of assets of foreign banks with the assets of the China banking system is provided in a form of analytical graph. The author’s assessments of the foreign banking sector over the past ten years give grounds to conclude that there was a stagnation in the development of the foreign banks sector during this period. The recent steps of the Chinese authorities to liberalize the foreign banking sector are analyzed in detail. The author examines the Chinese leader’s systematic approach to the banking reforms and comes to the idea that it consists of three components: the change in the political vision and attitudes, the institution reform of the banking regulators and the reform of banking legislation. An assessment of the impact of liberalization on the development prospects of foreign capital banks is also given. Based on an analysis of the overall scale and impact of recent reforms in the foreign banking sector, the author concludes that a new stage in the development of foreign capital banks in China is likely to begin. The main problems and challenges that foreign banks in China will have to face at a new stage of development are also identified and described.

scholarly journals Forign Ownership and Bank Performance: Evidence From Indonesia

2017 ◽  
Vol 8 (1) ◽  
Author(s):  
Amarilla Hapsari ◽  
Rofikoh Rokhim
Keyword(s):  
Commercial Banks ◽  
Banking Sector ◽  
Banking Industry ◽  
Positive Impact ◽  
Bank Performance ◽  
Industrialized Countries ◽  
Foreign Investors ◽  
Banking Market ◽  
The Government ◽  
The Impact

The main objective of this study is to examine the impact of foreign entry on the domestic bank-ing market’s profitability and overhead costs as financial sector FDI is a relatively new phenom-enon and typically takes the form of banks in industrialized countries establishing branches and facilities in developing countries. A panel data covering the period from 2000 to 2012 is set based on the financial data from 82 commercial banks, which operated in Indonesia as of De-cember 2012 and represented 92 percent of the commercial banks’ total assets. The results of this study are expected to complement the existing collection of studies on the foreign penetra-tion in the Indonesian banking industry, as to date there has been limited study of the impact of foreign ownership on bank performance in Indonesia. From a policy perspective, this study draws some conclusions which clarify the impacts of foreign penetration on banking industry. The government should continue to open the banking market up to foreign investors if they are proven to bring a positive impact, and should act conversely if they are proven to have an adverse impact on the local banking sector.

scholarly journals ANALYSIS OF THE BEHAVIOR MODEL OF HOUSEHOLDS BEFORE AND DURING COVID-19 IN UKRAINE

2020 ◽  
pp. 112-120
Author(s):  
I Bielova ◽  
I. Diakonova ◽  
O. Pakhnenko ◽  
A. Bukhtiyarova
Keyword(s):  
Banking Sector ◽  
Consumer Price Index ◽  
Mortgage Lending ◽  
Household Behavior ◽  
Point Of View ◽  
Economic Life ◽  
Current Crisis ◽  
Household Sector ◽  
Macroeconomic Indicators ◽  
The Impact

The article is devoted to the study of the problems of the household sector in Ukraine, as well as the analysis of the impact of the COVID-19 pandemic on their current state. Crises have a significant impact on household behavior. Studies conducted by many authors have shown that the depth of the crisis in the economy and the duration of the exit from it depend on the nature of the factors that caused the crisis. From this point of view, the current crisis is unique. And not just because it has spread across the planet, but because of its reason – COVID-19, which has left economic life almost paralyzed. The article considers such indicators of the household sector in pre-crisis and crisis periods as the dynamics of household income, expenditure and savings, household activity in the banking sector (dynamics of loans and deposits), as well as macroeconomic indicators such as exchange rate dynamics, consumer price index, average wages, employment and its structure, retail turnover and others. The article pays special attention to the state of the public health system in Ukraine and the analysis of the performance of hospitals before and during the pandemic. The results of the study showed that even before the pandemic, there were several negative trends, including a decrease in the number of doctors and hospitals, lower household savings and mortgage lending. The first six months of the pandemic only deepened all the problems created by the critical state of Ukraine's economy in recent years. To date, the model of household behavior is characterized by a minimum level of consumption, lack of investment component and efforts to create the maximum buffer of security. In these conditions, the problem of efficient allocation of available limited resources becomes especially important. But the realities of targeted use of anti-coronavirus funds, incompetence in the choice of methods and tools of public administration and regulation, which often contradict each other, give reason to believe that it is necessary to develop appropriate models to coordinate the actions of different ministries, departments, government bodies. This will achieve the common goal of stabilizing the economy.

The Impact of Foreign Capital on the Russian Banking Sector

Auditor ◽  
2018 ◽  
Vol 4 (6) ◽  
pp. 56-60
Author(s):  
М. Мусаева ◽  
M. Musaeva
Keyword(s):  
Banking Sector ◽  
Foreign Capital ◽  
Banking System ◽  
The Impact ◽  
National Banking System

Th e article is devoted to the role of foreign capital in the national banking system. Th e author describes the main positive and negative aspects of its infl uence.

Are competition and performance friends or foes? Evidence from the Middle East banking sector

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Mudeer Ahmed Khattak ◽  
Mohsin Ali
Keyword(s):  
Middle East ◽  
Banking Sector ◽  
Market Competition ◽  
Generalized Method Of Moments ◽  
Islamic Banks ◽  
African Region ◽  
Content Type ◽  
Banking Market ◽  
Increased Risk ◽  
The Impact

Purpose This paper aims to investigate the impact of banking market competition on banks’ profitability and banks’ risk using a sample of six countries from the Middle East from 2006 to 2017. Design/methodology/approach This paper uses the system generalized method of moments estimator to tackle potential omitted variable bias, endogeneity and simultaneity issues. Findings After controlling for bank market and country-specific characteristics, this study reports strong and robust evidence that competition in the banking market is conducive to lower financial performance. This research further finds that intense banking competition leads to lower profitability and increased risk regardless of bank type. As the relationship is not different for Islamic banks, one can argue that activities of Islamic banks are based on the basic traditional banking operations and products, and banks need to diversify their business activities to reduce failure risk and preserve the banking sector’s stability. Originality/value This paper tries to bridge the gap by studying the impact of competition on bank performance in high-income dual banking Gulf Cooperation Council (GCC) economies. Earlier studies have either covered all the dual banking economies or the Middle East and North African region. The authors suggest that the GCC banking market is required to be studied separately because of its idiosyncrasies. Second, unlike earlier studies, the authors have not only examined the impact of competition on bank return but also on bank risk.

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