scholarly journals ACTIVATION OF BANKING LENDING OF THE REAL SECTOR OF ECONOMY AS A PRECONDITION OF RESTORATION OF ECONOMIC GROWTH

2018 ◽  
pp. 172-177
Author(s):  
Halyna Zabchuk
Keyword(s):  
Economic Growth ◽  
Banking Sector ◽  
Bank Lending ◽  
Real Sector ◽  
Real Economy ◽  
Bank Capital ◽  
Scientific Methods ◽  
The Real ◽  
Domestic Banks ◽  
Lending Activity

Introduction. The article deals with the main problems of bank lending. The proposals on the activation of bank lending in the real sector of the economy are substantiated. Purpose. The article aims to study the factors that restrain bank lending to the real sector, and to determine the directions of lending activating of the real sector of the economy by domestic banks. Method (methodology). The research has been conducted with the help of general scientific methods of analysis, namely, method of induction, method of deduction, method of systematization and generalization. Results. Economic growth in modern conditions cannot be ensured without attracting bank capital into the real economy. The main factors hindering the development of investment banking lending have been analysed. The basic mechanisms of further reformation of the banking sector in order to increase lending activity have been substantiated. A set of recommendations for improving the system of lending to the real sector of the economy by commercial banks at the present stage has been offered.

scholarly journals ROLE OF THE FINANCIAL SECTOR IN FINANCING THE ENTERPRISES OF THE REAL SECTOR OF THE ECONOMY

2018 ◽  
pp. 78-84
Author(s):  
Dmytro Malysh
Keyword(s):  
Stock Market ◽  
Interest Rates ◽  
Banking Sector ◽  
Financial Sector ◽  
Bank Loans ◽  
Positive Trend ◽  
Real Sector ◽  
Real Economy ◽  
The Real

Introduction. Financial sector plays an important role in the financing of business entities in the real economy sector. A possibility of rising funds through the stock or banking sector enables substantially to expand the scope of enterprises. However, the presence of permanent financial crises does not allow companies to use these opportunities in full. Therefore, the assessment of state and trends of the stock and banking sectors in the context of the use of their funds to finance companies in the real sector of the economy becomes important. Purpose. The article aims to identify contemporary issues of development of the stock and banking sectors in the context of their ability to finance companies in the real economy. Method. In order to achieve the goal of the research we have used the following methods: method of structural and dynamic analysis and method of economic and statistical analysis of the development of the stock and banking sectors of Ukraine. Results. It has been determined that the deterioration of the stock market in Ukraine led to its exclusion from the list of marginal markets. The largest segment of the Ukrainian stock and banking sector services the issuers, which are owned by the state. At the same time, the financial sector has features of bank-centeredness since banks play a leading role in financing of companies and in transactions of the stock market. Ukrainian stock market mainly carries out operations with government bonds and only a small part of operations provides financing for the activities of companies through the issue of stocks and bonds. The share of long-term sources of funding is gradually decreasing and it is critically low for economic growth of the country. The tempos of providing long-term and short-term bank loans for the company are slowing down. A positive trend is the reduction of interest rates on loans. There is a need to develop effective measures for using opportunities of the stock and banking sectors as well for financing companies in the real sector of the economy.

Lending to the real sector of the region’s economy: state, problems, prospects

2020 ◽  
pp. 42-49
Author(s):  
Iryna Pasinovych ◽  
Viktoriya Dmytruk
Keyword(s):  
Interest Rates ◽  
Capital Investment ◽  
Banking Sector ◽  
Foreign Currency ◽  
Point Of View ◽  
Real Sector ◽  
Real Economy ◽  
Labor Costs ◽  
The Real

Approaches to the essence and constituent elements of the real economy sector are analyzed, its optimal structure is determined. It is focused on servicing and infrastructural role of banks in relation to the entities of the real sector. The dynamics of the lending to the real sector of the economy and the level of its penetration is analyzed. The paper reveals that the growth of lending in this sector was restored only last year, but the level of penetration continues to decline. The banking sector is analyzed. The paper argues that it has become profitable for the first time since the crisis, but mainly due to reduction of deductions to reserves. The financial situation of enterprises of the real sector of the Ukrainian economy is estimated. After an increase in profitability, it was again observed to have fallen due to the growth of competition and labor costs. Production are found to have increased in the real sector, but the role of loans in its development is insignificant. The emphasis is placed on the leading role of banks in the region for business development. The regional features of lending to the real economy sector in the Lviv region are outlined. The paper determines that in this region the growth of industrial products is much higher than the average in Ukraine, while the share of balances on loans granted is one of the lowest. There are the tendencies towards the decrease of the number of banks in the given region, increase of balances of banks' claims on loans in absolute value, prevalence of long-term loans and foreign currency loans. By the share of received loans the processing industry is in second place, agriculture is in the third place. Low level of the share of unemployed loans, higher than the average in Ukraine indicator of the proportion of loans in capital investment, as well as higher interest rates on loans are the features of regional lending in the Lviv region. The factors limiting the obtaining of loans from the point of view of management entities of the studied region are outlined. Certain NBU branches are dominant in the Lviv region as for lending. The changes in the regulatory environment at the macroeconomic level that are directly related to lending are analyzed. The regulator's policy to revive lending to the real sector should be extremely cautious and systematic, aimed at limiting the concentration of risks, preventing excessive lending growth, increasing the stability of financial infrastructure and reducing the dollarization of the banking sector. Measures to increase lending in the Lviv region are outlined. The involvement of banks in the Lviv educational-industrial hub is proposed.

scholarly journals Stimulating the Banking Sector Participation in the System of the Real Sector of Economy Support

2020 ◽  
Vol 17 (5) ◽  
pp. 5-15
Author(s):  
E. V. Altukhova ◽  
M. A. Markov
Keyword(s):  
Banking Sector ◽  
Banking System ◽  
Real Sector ◽  
Real Economy ◽  
Economic Interests ◽  
The Real ◽  
Key Characteristics ◽  
Development Institutions ◽  
Micro Level ◽  
Business Entities

The development of the real sector is essential to ensure the growth of national economy in any country. The principle institution working with money in economy is banks. They maintain cash circulation of real sector companies and act as a source of investment, which is allocated in the form of banking credits. Taking into account the fact that the goal of stimulating the real economy growth is set not only for the banking system but for economy in general, the approach to its attaining should be complex and systematic. Because of that it is very important to develop a list of steps that could provide a differentiated approach in the system of supporting companies of the real sector. Such measures’ implementation includes the participation of development institutions and therefore, banks in the system of national projects realization. Upgrading legislative regulation in the sphere of interaction between banks and business entities is extremely important as well as the development of new finance tools providing the growth in finance potential in the real sector of economy. The article analyzes banks’ participation in crediting the real sector of economy in Russia, studies the key characteristics of crediting and puts forward steps both on the macro- and micro-level, which could coordinate economic interests of companies and banks and cut costs.

scholarly journals ANALYSIS OF THE STATE MARKET FROM THE POSITION OF ITS IMPACT ON THE FINANCIAL ARCHITECTURE OF ENTERPRISES OF THE REAL ECONOMY

2019 ◽  
pp. 26-35
Author(s):  
M. Dushak
Keyword(s):  
Stock Market ◽  
Banking Sector ◽  
Bond Market ◽  
The State ◽  
Real Sector ◽  
Real Economy ◽  
Equity Structure ◽  
The Real ◽  
Financial Architecture ◽  
Public Offering

The stock market plays a significant role in financing the economic entities of the real sector of the economy. The ability to raise funds using stock market instruments makes it possible to expand significantly the scale of business activity. However, the presence of recurring financial crises in the financial sector and the weak development of the stock market make it impossible for enterprises to take full advantage of these opportunities. So it is important to evaluate the state and trends of the stock market in the context of using its funds to finance real sector enterprises. In the course of the research, the authors conclude that the largest segment of the Ukrainian stock market serves government-owned issuers and mainly conducts domestic government bond transactions. Only a small proportion of operations provide financing for the activity of enterprises through the issue of shares and bonds. This situation testifies to the “fictitiousness” of the stock market, as it does not fulfill its key function of attracting temporarily free funds by issuers. In addition, the stock and bond market in Ukraine is scanty. Issuers, intending to make a public offering of shares, must fulfill sufficiently high requirements for their own securities, which does not encourage them to use this mechanism. The situation is similar in the bond market: in most cases, the issuers will spend more time and resources to carry out the issue than borrowing from the banking sector. The above points to the low interest of issuers in the real sector of the economy to use stock market instruments to manage the equity structure. There is a need to develop effective measures to leverage the stock sector's capabilities to finance businesses in the real economy. Keywords: enterprise financial architecture, stock market, bond market, capital structure.

Reducing the Risks of the Financial Sector to Ensure Sustainable Growth of the Russian Еconomy

2019 ◽  
Vol 12 (3) ◽  
pp. 86-92
Author(s):  
T. I. Minina ◽  
V. V. Skalkin
Keyword(s):  
Economic Growth ◽  
Monetary Policy ◽  
Financial Sector ◽  
Developed Countries ◽  
Sustainable Growth ◽  
Necessary Condition ◽  
Real Sector ◽  
Financial Instruments ◽  
The Real ◽  
The Impact

Russia’s entry into the top five economies of the world depends, among other things, on the development of the financial sector, being a necessary condition for the economic growth of a developed macroeconomic and macro-financial system. The financial sector represents a system of relationships for the effective collection and distribution of economic resources, their deployment according to public demand, reducing the risk of overproduction and overheating of the economy.Therefore, the subject of the research is the financial sector of the Russian economy.The purpose of the research was to formulate an approach to alleviating the risks of increasing financial costs in the real sector of the economy by reducing the impact of endogenous risks expressed as financial asset “bubbles” using the experience of developed countries in the monetary policy.The paper analyzes a macroeconomic model applied to the financial sector. It is established that the economic growth is determined by the growth and, more important, the qualitative development of the financial sector, which leads to two phenomena: overproduction in the real sector and an increase in asset prices in the financial sector, with a debt load in both the real and financial sectors. This results in decreasing the interest rate of the mega-regulator to near-zero values. In this case, since the mechanisms of the conventional monetary policy do not work, the unconventional monetary policy is used when the mega-regulator buys out derivative financial instruments from systemically important institutions. As a conclusion, given deflationally low rates, it is proposed that the megaregulator should issue its own derivative financial instruments and place them in the financial market.

Commercial Banks Credit and the Performance of Real Sector in Nigeria: 1990-2017

2020 ◽  
pp. 1-15
Keyword(s):  
Central Bank ◽  
Commercial Banks ◽  
Agricultural Sector ◽  
Manufacturing Sector ◽  
Bank Lending ◽  
Real Sector ◽  
Agricultural Credit ◽  
The Real ◽  
Scientific Discussion ◽  
The Cost

The study examined the arguments and counterarguments within the scientific discussion on commercial banks credit and the performance of real sector in Nigeria. The main objective of the study is to examine the effect of commercial banks credit on the performance of the real sector in Nigeria.Data was sourced from Central Bank of Nigeria Statistical Bulletin. A systematization literary approach for data analysis was Regression Analysis. Findings revealed that bank credit and bank lending rate does not have significant impact on real sector performance in Nigeria. It was showed that there was a positive and significant relationship between agricultural credit guarantee scheme fund and agricultural production in Nigeria. The study therefore recommends that banks should be directed to channel their credits towards the real sector to facilitate overall economic growth and development in Nigeria. It was recommended that there is the need policies that will favor the revamp of the agricultural sector in Nigeria should be given pride of place. Also, monetary authority through the Central Bank of Nigeria should create adequate policies and strategies towards deepening of the financial sector and reducing the cost of credit/loans so as to enhance productivity and consequently enhance the growth of the key sectors of economy such as manufacturing sector.

scholarly journals Financial system and growth and economic development

VUZF Review ◽  
2021 ◽  
Vol 6 (2) ◽  
pp. 160-170
Author(s):  
Małgorzata Hala
Keyword(s):  
Economic Growth ◽  
Economic System ◽  
Financial Institutions ◽  
Financial System ◽  
Financial Sector ◽  
Real Sector ◽  
The Real ◽  
State And Local ◽  
The Impact

The aim of the article is to present the role of the financial system in economic growth and development. The first part presents the traditional understanding of the relationship between the economic system and economic growth. The second part presents the experience of financial crises and their impact on the conversation on the mutual relations between the financial sector and the real sector. The third part shows the role of the state in the financial system. The article describes the arrangement of interrelated financial institutions, financial markets and elements of the financial system infrastructure.  It shows what part of the economic system the financial system is, and whether it enables the provision of services allowing the circulation of purchasing power throughout the economy. The article presents the important role of the financial system, the role related to the transfer of capital from entities with savings to entities that need capital for investments. It shows the financial system as a set of logically related organizational forms, legal acts, financial institutions and other elements enabling entities to establish financial relations in the real sector and the financial sector, and this system forms the basis of activity for entities using money, enabling the conclusion of various economic transactions, in which money performs various functions. The article also presents the concept of a financial crisis as a situation in which there are rapid changes in the financial market, usually associated with insufficient liquidity or insolvency of banks or financial institutions, and as a result, a decrease in production or its deepening. The article also includes issues related to the impact of public authorities (state and local authorities) on the financial system in the economy.

scholarly journals Transformation of the Banking Sector of Ukraine: Reasons and Consequences

2017 ◽  
Vol 1 (13) ◽  
pp. 33-48
Author(s):  
Myroslava Khutorna
Keyword(s):  
Economic Development ◽  
Banking Sector ◽  
Financial System ◽  
Market Concentration ◽  
The Other ◽  
Real Economy ◽  
The Real ◽  
Other Hand ◽  
The One

This paper is devoted to the consideration of the preconditions and results of the banking sector of Ukraine transforming, its influence on the sector’s productivity, stability and significance for the real economy. It’s grounded that banking sector of Ukraine has seriously weakened its potential for the economic development stimulation. On the one hand, due to the banking sector clearance from the bad and unscrupulous banks the system has become much more sensitive to the monetary instruments and its state is going to be more predictable and better controlled. But on the other hand, massive banks’ liquidations have caused the worsening of the confidence in financial system and radical increasing of the market concentration the highest degree of which is observed in the householders’ deposit market.

The macroeconomic impact of shocks to bank capital buffers in the Euro Area

2019 ◽  
Vol 20 (1) ◽  
Author(s):  
Derrick Kanngiesser ◽  
Reiner Martin ◽  
Laurent Maurin ◽  
Diego Moccero
Keyword(s):  
Euro Area ◽  
Banking Sector ◽  
Global Financial Crisis ◽  
Decomposition Analysis ◽  
Bank Lending ◽  
Empirical Literature ◽  
Bank Capital ◽  
Macroeconomic Impact ◽  
The Global Financial Crisis ◽  
The Impact

Abstract While the global financial crisis revealed a need for macroprudential policy tools to mitigate the build-up of risk in the financial system, the impact of such policies on the banking sector and the macroeconomy remains largely uncertain. We contribute to the empirical literature that estimates the impact of shocks to bank capital buffers on bank lending and the macroeconomy by estimating a Bayesian VAR model identified with sign restrictions. We use bank-level data for large euro area listed banks to construct an aggregate bank capital buffer for the euro area, which is included as another variable in the model. We estimate three shocks affecting the euro area economy, namely a demand shock, a monetary policy shock and a shock to bank capital buffers. We find that banks curtail lending and reduce their relative exposure to riskier assets in response to a shock to the bank capital buffer. Historical shock decomposition analysis shows that shocks to bank capital buffers have contributed to impair bank lending growth and to widen bank lending spreads, hence depressing economic activity.

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