scholarly journals Analisis Kredit Bermasalah, Tingkat Suku Bunga Dan Profitabilitas Pada PT. Bank Perkreditan Rakyat (BPR) KCP Limbanang Kabupaten Lima Puluh Kota

2021 ◽  
pp. 26-33
Author(s):  
Selvi Yona Sari ◽  
Muahammad Putra Pratama
Keyword(s):  
Interest Rate ◽  
Interest Rates ◽  
Positive Impact ◽  
Rural Credit ◽  
Nonperforming Loans ◽  
Interest Income ◽  
The Interest Rate ◽  
The Impact

This study aims to analyze problem loans, interest rates, and the impact on interest income in PT Bank Perkreditan Rakyat (BPR) KCP Limbanang, Lima Puluh Kota District. The research variables are Problematic Credit (x1), Interest Rate (x2), and Profitability (y). Based on the results of this study can be concluded that the level of nonperforming loans that occur at the Bank Perkreditan Rakyat (BPR) KCP Limbanang District Lima Puluh Kota from 2011-2012 the level of non-performing loans decreased compared to the previous year, it means the credit situation is getting better. The interest rate at Rural Bank of KCP Limbanang of Lima Puluh Kota District in 2011-2015 experienced fluctuations in the proof of the highest interest rate in 2011 and the lowest interest rate in 2015. Due to total assets in Rural Bank (BPR) KCP Limbanang District Lima Puluh Kota each year experienced a significant increase whereas profitability from the year 2011-2015 that experienced ups and downs of profitability, this is influenced by the rearrangement of terms and conditions of credit Rural Bank (BPR) KCP Limbanang District Fifty Cities.Finally, the authors suggest to Rural Credit Bank (BPR) Limbanang Kabupaten Lima Puluh Kota The level of nonperforming loans that occur in Rural Banks (BPR) KCP Limbanang District Lima Puluh Kota which continues to fall every year and also problem loans also below the maximum 5% have a positive impact on the bank, as well as an achievement for the bank as it can minimize nonperforming loans and due to improved supervision of good credit disbursement.

Evidence of customer sophistication behaviour in deposit markets: the case of Qatar

2020 ◽  
Vol 47 (5) ◽  
pp. 1181-1196
Author(s):  
Noura Abu Asab
Keyword(s):  
Interest Rate ◽  
Interest Rates ◽  
Banking Industry ◽  
Positive Impact ◽  
Monetary Shocks ◽  
Content Type ◽  
Interest Rate Volatility ◽  
Pass Through ◽  
The Interest Rate ◽  
The Impact

PurposeThe paper investigates the interest rate policy transmission mechanism and the role of market structure of the banking industry in Qatar.Design/methodology/approachCompetitiveness indexes are used to measure the degree of market power in the banking industry in Qatar. The momentum threshold autoregressive model is applied over the monthly period from January 2005 to June 2018 to examine the magnitude of intermediation and adjustment to disequilibria in the deposit market. In addition, to model interest rate volatility and overcome the problem of heteroscedastic errors in the error correction standard models, an asymmetric EC-EGARCH-M model is applied.FindingsThe findings suggest incomplete pass-through and asymmetric response to monetary shocks. The asymmetric adjustment mechanism is found to be downward rigid which suggests a high degree of customer sophistication and an elastic supply of deposits. The results of the EC-EGARCH-M show that the impact of monetary policy shocks has a significant positive impact on deposit interest rates and that negative monetary shocks trigger more conditional interest rate volatility in the next period than positive monetary shocks for a short maturity rate.Originality/valueThe paper is the first to highlight the behaviour of the interest rate pass through channel and measures the degree of competitiveness of the banking industry for the case of a small, rich country. In addition, using recent data, the paper applies different econometric methodologies and overcomes the problem of heteroskedastic errors by modelling the interest rate volatility using the EC-EGARCH-M model.

DETERMINAN INFLASI DI INDONESIA PERIODE 1980-2015

2016 ◽  
Vol 21 (1) ◽  
pp. 1-7
Author(s):  
Risna Risna
Keyword(s):  
Interest Rate ◽  
Interest Rates ◽  
Money Supply ◽  
Government Spending ◽  
Positive Impact ◽  
Secondary Data ◽  
Quantitative Approach ◽  
State Spending ◽  
Factors Affecting ◽  
The Interest Rate

This study aims to determine the effect of government spending, the money supply, the interest rate of Bank Indonesia against inflation.This study uses secondary data. Secondary data were obtained directly from the Central Bureau of Statistics and Bank Indonesia. It can be said that there are factors affecting inflationas government spending, money supply, and interest rates BI. The reseach uses a quantitative approach to methods of e-views in the data. The results of analysis of three variables show that state spending significantand positive impact on inflationin Indonesia, the money supply significantand negative to inflationin Indonesia, BI rate a significantand positive impact on inflation in Indonesia

scholarly journals The Impact of Interest Rate Ceilings on Microfinance Industry

2015 ◽  
Vol 2 (2) ◽  
pp. 10
Author(s):  
Ali Saleh Alshebami ◽  
D. M. Khandare
Keyword(s):  
Interest Rate ◽  
Interest Rates ◽  
Low Income ◽  
Secondary Data ◽  
Research Subject ◽  
Access To Credit ◽  
The Poor ◽  
Good Intention ◽  
The Interest Rate ◽  
The Impact

<p>Imposing ceilings on the interest rate has recently become one of the new hottest topics in microfinance industry; various debates have been discussing this issue to know the effect of interest rate ceilings on the supply of credit in particular and on microfinance industry in general. However in spite of the good intention behind these ceilings, there was no absolute result stating that ceilings have really contributed to the improvement or protection of the poor clients, indeed, these ceilings have hurt those low income people instead of helping them, due to these ceilings most of MFIs left the market or reduced their scale due to the inability to continue operating with low interest rate leaving the very poor clients without access to credit. Thus, the purpose of this paper is to review the impact of imposing such ceilings on the interest rates and to find out what alterative solutions can be employed as substitutes for them. This paper is entirely based on the secondary data collected from various records related to microfinance such as microfinance books, official websites and reports, published papers, and other sources related to the research subject.</p>

scholarly journals The Ability of Selected European Countries to Face the Impending Economic Crisis Caused by COVID-19 in the Context of the Global Economic Crisis of 2008

2020 ◽  
Vol 13 (8) ◽  
pp. 179
Author(s):  
Róbert Oravský ◽  
Peter Tóth ◽  
Anna Bánociová
Keyword(s):  
Interest Rate ◽  
Interest Rates ◽  
Economic Crisis ◽  
Economic Effects ◽  
European Countries ◽  
Consumer Confidence ◽  
Negative Consequences ◽  
Confidence Index ◽  
The Interest Rate ◽  
The Impact

This paper is devoted to the ability of selected European countries to face the potential economic crisis caused by COVID-19. Just as other pandemics in the past (e.g., SARS, Spanish influenza, etc.) have had negative economic effects on countries, the current COVID-19 pandemic is causing the beginning of another economic crisis where countries need to take measures to mitigate the economic effects. In our analysis, we focus on the impact of selected indicators on the GDP of European countries using a linear panel regression to identify significant indicators to set appropriate policies to eliminate potential negative consequences on economic growth due to the current recession. The European countries are divided into four groups according to the measures they took in the fiscal consolidation of the last economic crisis of 2008. In the analysis, we observed how the economic crisis influences GDP, country indebtedness, deficit, tax collection, interest rates, and the consumer confidence index. Our findings include that corporate income tax recorded the biggest decline among other tax collections. The interest rate grew in the group of countries most at risk from the economic crisis, while the interest rate fell in the group of countries that seemed to be safe for investors. The consumer confidence index can be considered interesting, as it fell sharply in the group of countries affected only minimally by the crisis (Switzerland, Finland).

On the Judicial Interest Rate: Towards a Law and Economic Theory

2013 ◽  
Vol 4 (1) ◽  
pp. 34-62
Author(s):  
Hugo A Acciarri ◽  
Nuno Garoupa
Keyword(s):  
Interest Rate ◽  
Interest Rates ◽  
Law And Economics ◽  
Policy Instruments ◽  
Institutional Settings ◽  
Rules Of Procedure ◽  
The Interest Rate ◽  
Substantive Law ◽  
The Impact ◽  
Neutral Effect

AbstractWhile all legal systems implement a form of pre-judgment or post-judgment interest, there is a dearth of literature on substantive law and economics analysing the impact, functioning, and assessment of the judicial interest rate. Current legal scholarship typically views the interest rate as having a neutral effect on private and social costs. This paper demonstrates that the issue is theoretically far more complex and largely influential in legal policy. Due to the asymmetric opportunity costs for each party in a case, judicial interest rates may lead to improper delay of proceedings or the decoupling of damages from recovery. These potential results influence the number of settlements and suits. On this ground, we compare different institutional settings from an economic perspective and conclude that the appropriate mechanism depends on the alternative policy instruments available, namely, the rules of procedure, court fees, or mechanisms for appropriately setting damages. Further, we argue that abolishing the statute which sets pre-judgment interest may be a proposal worth considering.

scholarly journals A Tax-Based Estimate of the Elasticity of Intertemporal Substitution

2013 ◽  
Vol 03 (01) ◽  
pp. 1350001 ◽  
Author(s):  
Jonathan Gruber
Keyword(s):  
Time Series ◽  
Interest Rate ◽  
Interest Rates ◽  
Consumer Expenditure ◽  
Intertemporal Substitution ◽  
Tax Rate ◽  
Elasticity Of Intertemporal Substitution ◽  
Using Data ◽  
The Interest Rate ◽  
The Impact

One of the most important behavioral parameters in macroeconomics is the elasticity of intertemporal substitution (EIS). Starting with the seminal work of Hall (Hall, R., 1978, Stochastic Implications of the Life Cycle — Permanent Income Hypothesis: Theory and Evidence, Journal of Political Economy 86, 971–987), researchers have used an Euler equation framework to estimate the EIS, relating the growth rate of consumption to the after-tax interest rate facing consumers. This large literature has, however, produced very mixed results, perhaps due to an important limitation: The impact of the interest rate on consumption or savings is identified by time-series movements in interest rates. Yet the factors that cause time-series movements in interest rates may themselves be correlated with consumption or savings decisions. I address this problem by using variation across individuals in the capital income tax rate. Conditional on observable characteristics of individuals, tax rate movements cause exogenous shifts in the after-tax interest rate. Using data on total non-durable consumption from the Consumer Expenditure Survey over two decades, I estimate a surprisingly high EIS of two. This finding is robust to a variety of specification checks.

scholarly journals Inflation Instability Impact on Interest Rate in Egypt: Augmented Fisher Hypothesis Test

2017 ◽  
Vol 5 (1) ◽  
pp. 1 ◽  
Author(s):  
Doaa Akl Ahmed ◽  
Mamdouh Abdelmoula M. Abdelsalam
Keyword(s):  
Interest Rate ◽  
Interest Rates ◽  
Negative Impact ◽  
Hypothesis Test ◽  
Portfolio Theory ◽  
Expected Inflation ◽  
Fisher Hypothesis ◽  
The Interest Rate ◽  
The Impact ◽  
Autoregressive Conditional Heteroscedasticity

The paper aims at examining an augmented version of Fisher hypothesis that include inflation instability. According to this hypothesis, there is a positive relation between interest rates and expected inflation. In contrast, there is a debate regarding the impact of inflation uncertainty on interest rate. According to the portfolio theory and models of asset pricing, inflation instability positively affects the interest rate. The reason is that risk-averse investors must be compensated with higher returns for higher risks. In contrast, the loanable funds theory implies a negative impact of inflation instability and interest rates since high uncertainty leads consumers to protect themselves against inflation by raising their savings which lowers consumption and interest rates. To compute inflation volatility, we applied different Autoregressive Conditional Heteroscedasticity models. The simple and augmented versions of Fisher hypothesis are examined using Markov Switch Model to account for possible regime shift in that relationship. For the original Fisher hypothesis, there is an evidence of supporting it in the first regime while that hypothesis does not hold in the second one. In the augmented version of Fisher hypothesis, portfolio theory hypothesis is verified in the first regime whereas the loanable funds hypothesis is confirmed in the second one.

scholarly journals The Effects of Money Supply and Interest Rates on Stock Prices, Evidence from Two Behavioral Experiments

2021 ◽  
Vol 8 (2) ◽  
pp. 33
Author(s):  
Christian A. Conrad
Keyword(s):  
Monetary Policy ◽  
Interest Rate ◽  
Stock Market ◽  
Interest Rates ◽  
Money Supply ◽  
Stock Prices ◽  
Positive Impact ◽  
Real Economy ◽  
Behavioral Experiments ◽  
The Impact

What is the impact of interest rate and monetary policy on the stock market? Some studies find a positive impact of expansive monetary policy on stock prices others prove the opposite. This paper examines the effects of monetary expansion and interest rate changes on investment behavior on the stock market by illustrating two behavioral experiments with students. In our experiments the increase of money supply and the decrease of interest rates had a direct positive impact on share prices. These findings support the hypothesis that extreme expansive monetary policy with low, zero or negative interest rates encourage financial bubbles on the stock market. To avoid a crash the exit from such a policy must be slow. As happened in 1929, crashes can damage the financial system and the real economy. Central banks must take this into account in their monetary policy.

scholarly journals German banks’ behavior in the low interest rate environment

2021 ◽  
Author(s):  
Ramona Busch ◽  
Helge C. N. Littke ◽  
Christoph Memmel ◽  
Simon Niederauer
Keyword(s):  
Interest Rate ◽  
Negative Impact ◽  
Mortgage Lending ◽  
Rate Level ◽  
Interest Income ◽  
Bond Portfolio ◽  
Rate Environment ◽  
Using Data ◽  
The Interest Rate ◽  
The Impact

AbstractUsing data from a quantitative survey of German banks at three points in time (2015, 2017 and 2019), we analyze the impact of changes in the interest rate level on banks’ net interest income and the countermeasures they take. A decline in the interest rate level has a more negative impact on net interest income, the longer the decline lasts and the lower the interest rate level is. This impact softens with increasing risk of changes in the present value of banking books. We do not find that banks generally increase their risks following a drop in income. However, poorly capitalized banks subsequently increase the credit risk of their bond portfolio. After a fall in operational income, banks increase their fee and commission income and reduce their costs. In addition, banks tend to extend their mortgage lending after a drop in their interest income.

scholarly journals Using Expected Geometric Values to Calculate the Cost of Interest in Hyper-inflationary Environments: the Case of Venezuela

2019 ◽  
Vol 2 (2) ◽  
pp. 10-21
Author(s):  
J. Tim Query ◽  
Evaristo Diz Cruz
Keyword(s):  
Interest Rate ◽  
Interest Rates ◽  
Expected Value ◽  
Defined Benefit ◽  
High Inflation ◽  
Defined Benefit Plans ◽  
The Interest Rate ◽  
The Cost ◽  
The Impact ◽  
The Relationship

It is of vital importance to explore the relationship between pensions and inflationary levels because this forms a link between social policy and economic development in the context of Venezuela’s challenging economy and its impact on the development of pension systems. With such rampant inflation, companies must adjust the rates of salary increases to avoid a significant decrease in the purchasing power of income from defined benefit plans. Our research seeks to find the possibility of using an average geometric rate of future interest rates expressed as an expected value to discount obligations. Consequently, the cost of interest associated with the actuarial liability of the Benefit plans increases substantially in the next fiscal period to the actuarial valuation, sometimes compromising its sustainability over time. In order to minimize this problem, two scenarios for calculating the interest rate are proposed to smooth out this volatile effect; both are based on a geometric average with the expectation of working life or with the duration of the obligations. We are careful to use a reasonable interest rate that is not so high as to compromise the cash flow, resulting in skewed annual results of the companies. Our research seeks to find the possibility of using an average geometric rate of future interest rates expressed as an expected value to discount obligations. We formulate and actuarially evaluate two different scenarios, based on job expectations and Macaulay's duration, of the obligations that allow the sustainability of the plan in an environment of extremely high inflation. To illustrate the impact of the basic annual expenditure of the period, the results of an actuarial valuation of an actual Venezuelan company were utilized. Despite some companies adjusting their book reserves increasingly through a geometric progression, the amounts associated with the costs of interest would be huge in any such adjustment pattern. Therefore, we suggest adoption of one of the alternatives described in the research.

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