scholarly journals An innovative approach to managing the interest margin: economic and statistical analysis of the resource base of a commercial bank

VUZF Review ◽  
2021 ◽  
Vol 6 (1) ◽  
pp. 26-37
Author(s):  
Svitlana Andros ◽  
Svitlana Andros ◽  
Shichao CHANG

The dynamics of interest income, that is, the difference between the average rates on active and passive operations of the bank, has been analyzed. It was found that the increase in the share of term deposits in the total amount of the bank's mobilized resources is positive, despite a temporary decrease in net income from bank interest. It has been substantiated that the deposits of legal entities are a stable part of the attracted resources. Long-term deposits allow lending for long periods and at high interest rates. The purpose of the article is to improve an innovative approach to managing the interest margin based on the economic and statistical analysis of the bank's resource base. Literature processing shows that banks pay insufficient attention to the methodology for assessing interest income. The relevance of the article is determined by the value of interest income as one of the main factors that determine the profitability of the bank's lending operations. The methods of comparison, grouping, detailing of final indicators, calculation of relative and average values are used. The scheme of the bank interest margin management process is proposed. Calculated the average size of credit investments, the total amount of assets. The average price of credit resources was calculated based on the price of a particular type of resource and its share in the total amount of funds mobilized by the bank. The average level of interest on active and passive operations of the bank was determined based on the received interest income. The size of interest income, trends and factors of its change have been determined. The indicator of the minimum interest income was calculated on the basis of which the bank covers expenses, but does not ensure profit. The level of profitability of bank loan operations has been determined. It has been established that a change in interest income can be caused by an increase or decrease in rates on active operations of the bank, interest on attracted resources and the share of the latter in the total volume of credit investments. The average real price of demand deposits and time deposits attracted by the bank was determined on the basis of the market price of these resources and adjustments for the rate of the required reserve deposited with the NBU. A mechanism for the formation of bank interest income is proposed. The expected size of the minimum profit margin and the level of profitability of the bank's lending operations are presented. The approximate minimum price of credit investments was determined based on the level of costs and the pledged amount of profitability of the bank's lending operations for the coming period. The possibility of reducing the spread of rates of attraction and rates of placement of resources in the bank through the use of the proposed funding mechanism has been scientifically substantiated.

2019 ◽  
Vol 6 (3) ◽  
pp. 295
Author(s):  
Hendaryadi , ◽  
Meina Wulansari Yusniar ◽  
Abdul Hadi

<p><em>This study aimed to analyze the effects of interest rates, bond rating, company size, and debt to equity ratio (DER) of the yield to maturity (YTM) of corporate bonds in Indonesia Stock Exchange. Previous researches showed different results, therefore, it is necessary to re- study by testing the four variables on the yield to maturity.</em></p><p><em>The population in this study was all corporate bonds listed and traded on the Stock Exchange in the period of 2010-2012. There were 324 bonds. Based on the Purposive sampling criteria, 66 bonds were obtained. The research hypothesis was tested by multiple linear regression (multiple regression) and the analysis tools were company's financial statements, market price of the bond, SBI interest rate and bond ratings.</em></p><p><em>The results showed that the variable interest rates and the debt to equity ratio did not significantly affect the yield to maturity of the bonds. Variable bond rating and company size gave     significant</em><em> </em><em>n</em><em>e</em><em>g</em><em>a</em><em>ti</em><em>ve</em><em> </em><em>ef</em><em>f</em><em>ec</em><em>t</em><em>s</em><em> </em><em>ontheyield</em><em> </em><em>t</em><em>omaturity</em><em> </em><em>of</em><em> </em><em>t</em><em>he</em><em> </em><em>bonds.</em><em></em></p>


2021 ◽  
Vol 40 (3) ◽  
pp. 80-96
Author(s):  
Vicentiu Covrig ◽  
Daniel McConaughy ◽  
Adam Newman ◽  
Pavan Kumar Nadiminti ◽  
Mary Ann K. Travers

This article presents the first detailed statistical analysis of the volatilities of various commonly encountered financial metrics used in contingent consideration (and earn-out) agreements. The valuation of contingent consideration using an option-based methodology and non-equity volatilities is becoming more common in business valuation. We provide clear evidence that the volatility of five financial metrics—revenue; earnings before interest, taxes, depreciation, and amortization (EBITDA); EBIT, net income, and total assets—is strongly, negatively related to firm size and profitability. However, contrary to common belief, the volatility of these metrics is not related to a firm's financial leverage. We also calculated the volatilities using four different methodologies that are employed in practice. Although no theory guides the selection of methodologies, based upon our work, we have found that the year-over-year growth rate, using a quarterly frequency, provides the most reasonable results.


2018 ◽  
Vol 7 (7) ◽  
pp. 3502
Author(s):  
Ayusta Riana Dewi ◽  
I Putu Yadnya

Industri BPR yang sehat diperlukan dalam rangka menciptakan stabilitas sistem keuangan, dan mendorong pertumbuhan ekonomi nasional. Penelitian ini bertujuan untuk mengetahui pengaruh Size/ukuran bank, Loan to Deposit Ratio (LDR), Non Performing Loan (NPL) dan Net Interest Margin (NIM) terhadap Capital Adequacy Ratio (CAR). Penelitian ini dilakukan pada BPR di Provinsi Bali periode 2015-2016. Teknik pengambilan sampel menggunakan metode sensus yang berjumlah 137 BPR dengan teknik analisis data regresi linier berganda. Berdasarkan hasil analisis menunjukkan bahwa Size/ukuran bank berpengaruh negatif signifikan terhadap CAR. Hal ini menunjukkan bahwa semakin tinggi total asset suatu bank maka bobot risiko semakin tinggi dan kecukupan modalnya akan menurun.  LDR dan NIM berpengaruh positif signifikan terhadap CAR. Hal ini menunjukkan bahwa semakin tinggi LDR dan NIM maka kecukupan modal akan meningkat. NPL berpengaruh negatif signifikan terhadap CAR. Hal ini menunjukkan bahwa semakin tinggi NPL maka kecukupan modal bank akan menurun. Kata kunci: CAR, SIZE, LDR, NPL, NIM


2017 ◽  
Vol 56 (1) ◽  
pp. 341-365 ◽  
Author(s):  
Paula Cruz-García ◽  
Juan Fernández de Guevara ◽  
Joaquín Maudos

2008 ◽  
Vol 23 (04) ◽  
pp. 296-303 ◽  
Author(s):  
J.M. Halloran ◽  
D.W. Archer

AbstractUS agriculture operates in a market driven economy, although government policies can have influence on what farmers produce and how they produce it. As with other businesses, agricultural producers respond to economic incentives and disincentives, and make decisions to maximize their welfare; usually measured as net income. We examined how external economic drivers shape the type of agricultural systems that producers adopt. Specifically, we considered the influence of technological advancements, income supports embodied in farm legislation, and changes in market structure and consumer demand. Changes in technology have often favored large-scale and specialized operations. Many of the technological advancements have required large-scale production units to justify the investment. Often the technology has been commodity specific. However, there is some evidence that more diversified production units might be able to achieve economies of both scale and scope. The influence of commodity support programs has been ambiguous. As farm legislation has evolved to decouple production decisions from program benefits, the incentives to specialize in program crops (crops that receive price and/or income benefits under federal legislation, such as corn, other grains and oil seeds) have diminished. However, wealth and risk effects, albeit small, may have promoted or inhibited the adoption of a more integrated system. The ability of producers to adopt more integrated systems has been primarily influenced by their natural resource base and proximity to markets. Changes in market structure, channels and consumer demand in the past five decades have been dramatic with consolidation and specialization in both production and marketing sectors. However, the diversity of consumer demand has also created opportunities for more integrated farm operations. There is an increasing number of consumers who have become concerned about how and where their food has been produced. Markets for organic, locally produced, free range and the like are expected to grow. While price and income supports may have been biased towards specialization (as these programs were targeted to specific commodities), the reduction in risk associated with the programs has enabled producers to expand the number and diversity of their production enterprises. Furthermore, through the use of strategic alliances, cooperation among producers on a regional basis may eventually lead to greater integration and diversification than could be achieved for the individual farm operation.


2020 ◽  
Vol 1 (2) ◽  
pp. 56-65
Author(s):  
Maswir Mutakhir

This study aims to determine whether changes in SBI interest rates and changes in the USD / IDR exchange rate have an influence on the PT BCA Stock Market Price during the period January 2015-December 2019. The data used are secondary data provided by relevant institutions. The research method uses multiple linear regression models. To test the significance of the effect of the independent variable on the dependent variable partially, the t test is used. The partial test results on changes in the independent variable on changes in the dependent variable note that changes in SBI Interest Rates have a negative and insignificant effect on the Stock Market Price of PT Bank Central Asia Tbk, while The USD / IDR exchange rate has a positive and insignificant effect on the Stock Market Price of PT Bank Central Asia Tbk. The value of the coefficient of determination is 4.2%, which means that the proportion of changes in the PT BCA Stock Market Price which can be explained by variations in changes in SBI interest rates and changes in the exchange rate of USD / IDR is 4.2%, while the remaining 95.8% is explained. by other variables. Penelitian ini bertujuan untuk mengetahui apakah perubahan Suku Bunga SBI dan perubahan Kurs USD/IDR mempunyai pengaruh terhadap Harga Pasar Saham PT BCA selama periode Januari 2015–Desember 2019. Data yang digunakan adalah data sekunder yang disediakan lembaga yang relevan. Metode penelitian  menggunakan model regresi linier berganda. Untuk menguji signifikansi pengaruh variabel independen terhadap variabel dependen secara parsial digunakan uji t.Hasil pengujian secara parsial atas  perubahan variabel independen terhadap perubahan variabel dependen diketahui bahwa perubahan Suku Bunga SBI mempunyai pengaruh negatif dan tidak signifikan terhadap Harga Pasar Saham PT Bank Central Asia Tbk, sedangkan Kurs USD/IDR mempunyai pengaruh positif dan tidak signifikan terhadap Harga Pasar Saham PT Bank Central Asia Tbk. Nilai Koefisien Determinasi adalah sebesar 4,2% yang artinya besarnya proporsi variasi perubahan Harga Pasar Saham PT BCA yang dapat dijelaskan oleh variasi perubahan tingkat Suku Bunga SBI dan perubahan Kurs USD/IDR adalah sebesar 4,2% sedangkan sisanya sebesar 95,8% dijelaskan oleh variabel lainnya.


2009 ◽  
Vol 17 (2) ◽  
pp. 49-66
Author(s):  
Kwang-Il Bae ◽  
Jin Hee Choung

The weather largely affects economic activity, and thus, companies vulnerable to weather risk need to plan ahead to cope with unexpected weather changes, just as they do for changes in interest rates, oil prices, or foreign exchange rates to stabilize their earning stream. Weather derivatives can be a useful tool for weather risk management. This paper focuses on pricing one of the most popular weather derivatives -HDD/CDD options- and estimating the market price of weather risk (MPR). Historical data are used to construct the stochastic process of temperature, while the current market prices of Chicago and New York HDD futures options are used to extract the implied MPR. The Monte-Carlo Simulation Method is proposed to estimate the price of weather derivatives numerically. In addition, the approximate closed form formula for the options is provided modifying the Alaton, Djehiche, and Stillberg (2002) model. Finally, option price sensitivity to changes in MPR is analyzed to show the important role of the MPR in the weather option pricing model.


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