scholarly journals What future for the European banking system?

2018 ◽  
Vol 87 (4) ◽  
pp. 141-151
Author(s):  
Lorenzo Bini Smaghi
Keyword(s):  
Interest Rates ◽  
Capital Market ◽  
Banking Sector ◽  
Banking System ◽  
The Us ◽  
Low Interest Rates ◽  
European Banking ◽  
European Banks ◽  
Main Factors

Zusammenfassung: Das Papier beleuchtet die Hauptgründe, die der sinkenden Rentabilität des europäischen Bankensektors im Vergleich zum US-amerikanischen zugrunde liegen. Sie unterstreicht insbesondere die Rolle niedriger Zinsen, geringerer Konzentration, strengerer Regulierung und des Fehlens eines tiefen und liquiden Kapitalmarktes. Ein stärkeres europäisches Bankensystem erfordert echte gesamteuropäische Banken und eine echte Kapitalmarktunion. Summary: The paper assesses the main factors underlying the decreasing profitability in the European banking sector, in comparison with the US. It underscores in particular the role of low interest rates, lower concentration,tighter regulation and the absence of a deep and liquid capital market. A stronger European banking system requires true pan-European banks and a true capital market union.

scholarly journals THE ALBANIAN ECONOMY IN THE STOCK MARKET PERSPECTIVE

2019 ◽  
Vol 31 (1) ◽  
pp. 149-155
Author(s):  
Bajram Lamaj ◽  
Stefan Simeonov
Keyword(s):  
Interest Rates ◽  
Capital Market ◽  
Banking Sector ◽  
Stock Exchange ◽  
Banking System ◽  
Financial System ◽  
Economic Benefits ◽  
Stock Index ◽  
Individual Investors ◽  
The Capital Market

Since the origin of the capitalist economic system, Albania suffers from a shrinking financial system. The financial system lacks what is perhaps the most important and dynamic part in developed economies: a capital market. It is an important element for the country's economic and financial development, as it is a very competitive alternative to the banking sector, reducing intermediation costs for businesses and all economic operators by enabling cheaper alternatives to fund the activity. Today, the banking system has almost exhausted opportunities to be a business financing promoter. And this is the stage where the Albanian economy has come to. Businesses cannot meet all the financing needs of the banking system, while on the other hand, there are individuals who, at the moment, have little choice of investment of their savings. Interest rates, both for bank deposits and government securities, have already reached an extremely low level and are not at all attractive for individual investors, which makes them look for far more attractive investment alternatives. In this way the scholarship will bring an alternative that individuals can invest savings in shares or other securities of companies that will be interested in trading in Albania thus developing the capital market and taking advantage of all the economic benefits that it brings. In this paper, we will firstly address the concept of the capital market and the elements that shape it as well as its development in Albania. The main purpose of this paper is to identify the problems faced by Tirana's former scholarship, to study the situation and the current opportunities of the Albanian economy to develop this structure of the capital market, namely the stock exchange, and to create a stock index model with which Albania can develop this structure and why not be represented in the regional and international markets.

scholarly journals Affordable Credit Resources to Implement Investment Projects in Industry of Russia

2020 ◽  
Vol 17 (4) ◽  
pp. 24-35
Author(s):  
V. A. Eremkin
Keyword(s):  
Interest Rates ◽  
Commercial Banks ◽  
Banking Sector ◽  
Credit System ◽  
Investment Projects ◽  
Industrial Enterprises ◽  
Low Interest Rates ◽  
The Russian Federation ◽  
The Impact

Raising loan finance by industrial enterprises for the development of their investment projects is an important factor for economic growth in Russia. Due to this the problem of credit resource affordability for Russian business becomes more and more topical. The article analyzes possibilities of credit affordability regulation for industrial enterprises by tools of monetary policy of the Central Bank of the Russian Federation. The author aims at indentifying the current problems of the credit system for industrial enterprises and finding the key lines in its improvement. Within the frames of the research the author estimates the impact of high and low interest rates on the volume of industry crediting, analyzes the structure of giving credits to non-financial organizations and studies the problem of long cash affordability for realizing investment projects in industry. The article also investigates the asset concentration in the banking sector and shows the higher role of state and the diminishing number of commercial banks and their branches. Certain important lines of development were identified, which in the future could determine the situation in industry crediting in Russia. Finding of the research can be used for devising the state strategy of developing the system of industry crediting in Russia.

PESTEL Analysis-Based Evaluation of Marketing Strategies in the European Banking Sector

2020 ◽  
pp. 429-448
Author(s):  
Hasan Dinçer ◽  
Fatih Pınarbaşı
Keyword(s):  
Interest Rates ◽  
Banking Sector ◽  
Technological Development ◽  
Marketing Strategies ◽  
Strategy Development ◽  
Fuzzy Dematel ◽  
European Banking ◽  
European Banks ◽  
The Interest Rate ◽  
Interval Type

This chapter evaluates the marketing strategies in European banking sector. In this context, six dimensions of PESTEL analysis (politic, economic, sociological, technologic, environmental, and legal) are taken into the consideration. On the other side, interval type-2 fuzzy DEMATEL approach is used to weight the importance of these dimensions. The findings show that technological and political factors have the highest importance. Therefore, it is recommended that technological innovations in the banking sector should be followed by European banks. Within this framework, these banks should design a market research department to follow these developments in the market so that new products and services can be identified. Therefore, technological development should be adopted in the strategy development process. In addition, interest rates defined by the central bank should also be considered by these banks. Hence, adopting marketing strategies according to the interest rate policy of the central banks provides a competitive advantage to the European banks.

scholarly journals Virtual Currencies Like Bitcoin As A Paradigm Shift In The Field Of Transactions

2015 ◽  
Vol 14 (4) ◽  
pp. 575 ◽  
Author(s):  
Chris Richter ◽  
Sascha Kraus ◽  
Ricarda B. Bouncken
Keyword(s):  
Interest Rates ◽  
Paradigm Shift ◽  
Banking Sector ◽  
Banking System ◽  
Virtual Currency ◽  
High Transparency ◽  
Advantages And Disadvantages ◽  
The World ◽  
Money Flows ◽  
Low Interest Rates

Virtual currencies have been well-cited and well-discussed in the near past. Due to the loss of trust in the banking sector and the fear of loss of capital, low interest rates and uncertainty of existing currencies, the ground for a virtual currency was given. Virtual currencies and the money flows are controlled only online by the anonymous group of volunteers (also called peer); every single transaction is documented. Approximately 10,000 businesses worldwide accept payments with virtual currencies already, and the number is increasing steadily. This article analyzes the advantages and disadvantages of virtual currencies in comparison to real money and gives an outlook to a new banking system with high transparency and the chance to lead to a paradigm shift in the world of transactions and banking.

scholarly journals ANALYSIS OF THE DYNAMICS OF THE EUROPEAN BANKING SYSTEM

2020 ◽  
Vol 6 (4) ◽  
pp. 156-167
Author(s):  
Marianna Stehnei ◽  
Maryna Korol
Keyword(s):  
European Union ◽  
Banking Sector ◽  
Global Financial Crisis ◽  
Banking System ◽  
The United States ◽  
Practical Significance ◽  
Positive Trend ◽  
The European Union ◽  
European Banking ◽  
European Banks

Relevance of research. Existence of global financial crises points to the fact that in the world there is no perfect banking system and therefore the efficiency of the banking system requires a detailed study, including major performance indicators. The aim of the study is to summarize and characterize the existing trends of banking system evolution in the European Union. Methodological basis of the study – is based on the analysis of the study of the dynamics of such indicators as the number of banking institutions, the volume of assets and liabilities, asset quality, as well as the profitability of the banking sector of the European Union. A systematic analysis of the quantitative and qualitative composition of the above-mentioned banking indicators, synthesis and generalization were used to generalize and formulate conclusions. Scientific results. This article is devoted to the study of the dynamics of the main indicators of the European banking system during the period from 2000 to 2019 inclusive. It is argued that the number of commercial banks has decreased over the last decade, including in the European Union. Bank branches are no exception, the negative dynamics of the number of which was followed by the global financial crisis of 2008-2009. At the same time, it was found that the volume of bank assets shows a positive trend. Regarding the geographical distribution of assets, in 2019 the leading position was taken by France, Germany, Italy and Spain. At the same time, the volumes of liabilities of the financial sector of the European Union for the studied period also show a positive trend. The structure of loans is characterized and it is emphasized that the vast majority of loans are issued to non-financial corporations and households, which is an evidence of the business orientation of banks to provide loans to the real sector of the economy. It has been established that one of the key problems facing European banks is profitability, which today still could be on a better level than in 2007, the year of the financial surge. This situation distances European banks from competitors in the United States, which have shown positive dynamics of their profits. However, it is encouraging that the quality of assets of the European Union banks has significantly improved over the last 4 years. The practical significance of the study is to rate the strengths and weaknesses of the European banking system. Significance/originality. The results achieved from an integrated view of the functioning of the banking system of the European Union, which will allow the authors to further build a model for verifying the stability of the banking system.

Same Story, Different Place?

2018 ◽  
Author(s):  
Viral V. Acharya ◽  
Tim Eisert ◽  
Christian Eufinger ◽  
Christian Hirsch
Keyword(s):  
Banking Sector ◽  
Debt Crisis ◽  
Banking System ◽  
Policy Implications ◽  
Balance Sheets ◽  
System P ◽  
Loan Supply ◽  
European Banking ◽  
European Debt Crisis

This chapter compares the recapitalizations of the Japanese banking sector in the 1990s with those in the ongoing European debt crisis. The analysis points to four main policy implications. First, recapitalizing banks by insuring or purchasing troubled assets alone is not likely to solve the problem of banks’ weak capitalization, as this measure is not able to adjust the extent of the recapitalization to the banks’ specific needs. Second, the amount of the recapitalization should be based on actual capital shortages and not risk-weighted assets to avoid banks decreasing their loan supply. Third, banks should face restrictions regarding the amount of dividends they are allowed to pay out. Finally, banks must be induced to clean up their balance sheets and reduce the amount of bad (non-performing) loans to rebuild confidence in the European banking system.

scholarly journals Who Bears Interest Rate Risk?

2018 ◽  
Vol 32 (8) ◽  
pp. 2921-2954 ◽  
Author(s):  
Peter Hoffmann ◽  
Sam Langfield ◽  
Federico Pierobon ◽  
Guillaume Vuillemey
Keyword(s):  
Interest Rate ◽  
Interest Rates ◽  
Banking Sector ◽  
Balance Sheet ◽  
Interest Rate Risk ◽  
Cross Sectional ◽  
Net Worth ◽  
Loan Rate ◽  
Rate Risk ◽  
European Banking

Abstract We study the allocation of interest rate risk within the European banking sector using novel data. Banks’ exposure to interest rate risk is small on aggregate, but heterogeneous in the cross-section. Contrary to conventional wisdom, net worth is increasing in interest rates for approximately half of the institutions in our sample. Cross-sectional variation in banks’ exposures is driven by cross-country differences in loan-rate fixation conventions for mortgages. Banks use derivatives to partially hedge on-balance-sheet exposures. Residual exposures imply that changes in interest rates have redistributive effects within the banking sector. Received October 31, 2017; editorial decision August 30, 2018 by Editor Philip Strahan. Authors have furnished an Internet Appendix, which is available on the Oxford University Press Web site next to the link to the final published paper online.

scholarly journals Analisis Peran Negara Di Bidang Ekonomi Dalam Prespektif Sistem Kapitalisme, Sosialisme, Dan Ekonomi Islam

2016 ◽  
Vol 1 (1) ◽  
Author(s):  
Muhammad Kambali
Keyword(s):  
Interest Rates ◽  
Conceptual Framework ◽  
Economic System ◽  
Economic Crisis ◽  
The State ◽  
Planning System ◽  
Role Of The State ◽  
The World ◽  
Low Interest Rates

The economic crisis that convolved the world economy a few years ago is the result of a series of government policies in the economic field. Starting from the Subprime Mortgage in America, the crisis eventually spreads across all sectors of the economy. As analysts say that the explosion of the current economic crisis is caused by the trend of low interest rates that are applied by the Fed. The trend of low interest rates will give rise to expectation of market to future economic situation. It is characterized by the overflow of capital expansion in all sectors, especially in property sector. Today, along with the growing mobility of capital from one country to another as part of unavoidable economic liberalization, mobility of capital, on the one hand, has spawned some of the imbalances in the life of a State. The powerlessness can not be separated from economic ideology and system on state role in the economy. Capitalism with its laissez faire brings the concept of state minimal role in the economy. In the empirical facts, it is broken by the crisis situation in 1930 and today's financial crisis. Socialism tends to carry the central role of the State in the economy through the centralistic planning system. The fall of the Soviet Union in the 1980s brought the world to a choice whether reconstructing capitalism or socialism as Fukuyama and Gidden said. On the other hand, as the new system, the economic system of Islam brings the concept of the role of the State in the economy on the basis of universal values of Islam, such as justice in the economy which is reflected in the mechanism of the prohibition of riba (usury), just income distribution and redistribution of income through zakat and social security. This article is an exposure of the State's role in the economy which is studied through the perspective of today’s economic system. The systems are capitalism, socialism, and Islam. The article not only explores conceptual framework, but also also contains an empirical framework mapping and how the conceptual framework is operated. At the end, from the two mapping (conceptual and empirical), author draws a reflection of how the State should play a role in the economic field. Keywords: Capitalism, Socialism, Islam, Economic Role of State

scholarly journals PANDEMIC CRISIS AND ITS EFFECTS ON BULGARIAN BANKING SYSTEM’S EFFICIENCY

2021 ◽  
Author(s):  
Gergana Mihaylova-Borisova ◽  
Keyword(s):  
Growth Rate ◽  
Interest Rates ◽  
Banking Sector ◽  
Global Financial Crisis ◽  
Negative Impact ◽  
Debt Crisis ◽  
Parametric Method ◽  
Banking System ◽  
Data Envelopment ◽  
The Global Financial Crisis

The economies are once again facing the challenges of another crisis related to the spread of coronavirus in 2020. The banking sector, being one of the main intermediaries in the economies, is also affected by the spread of the new crisis, which is different compared to the previous crises such as the global financial crisis in 2008 and the European debt crisis in 2012-2013. Still, the banking sector in Bulgaria suffers from the pandemic crisis due to decelerated growth rate of loans, provided to households and non-financial enterprises, as well as declining profits related to the narrowing spread between interest rates on loans and deposits. The pandemic crisis, which later turned into an economic one, is having a negative impact on the efficiency of the banking system. To prove the negative impact of the pandemic crisis on the efficiency of banks, the non-parametric method for measuring the efficiency, the so-called Data envelopment analysis (DEA), is used.

scholarly journals Does the Interest Rate Form Business Cycle?

2019 ◽  
Vol 4 (1) ◽  
pp. 29-34
Author(s):  
Bijan Bidabad ◽  
Abul Hassan
Keyword(s):  
Interest Rate ◽  
Business Cycle ◽  
Interest Rates ◽  
Banking System ◽  
Real Economy ◽  
Short Term ◽  
The Usa ◽  
Rate Form ◽  
The Interest Rate

Dynamic structural behavior of depositor, bank and borrower and the role of banks in forming business cycle are investigated. We test the hypothesis that does banks behavior make oscillations in the economy through the interest rate. By dichotomizing banking activities into two markets of deposit and loan, we show that these two markets have non-synchronized structures, and this is why the money sector fluctuation starts. As a result, the fluctuation is transmitted to the real economy through saving and investment functions. Empirical results assert that in the USA, the banking system creates fluctuations in the money sector and real economy as well through short-term interest rates

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