scholarly journals Factors affecting the interest rate policy of commercial banks

2021 ◽  
Vol 1 (79) ◽  
pp. 140-150
Author(s):  
M. Zh. Arzaeva ◽  
◽  
G. I. Supugalieva ◽  
G. R. Kasymbekova ◽  
D. M. Mukhiyaeva ◽  
...  
Keyword(s):  
Interest Rates ◽  
Commercial Banks ◽  
Factors Affecting ◽  
Interest Rate Policy ◽  
Factors Influencing ◽  
Interest Policy ◽  
Rate Policy ◽  
The Interest Rate ◽  
Internal And External Factors ◽  
General Synthesis

The subject of the flock is conditioned by the need to consider the influence of internal and external factors on the interest rates of banks. The purpose of the study is a comprehensive, reliable study of the main factors influencing the formation of interest rates on the basis of methods of cognition developed in science, as well as obtaining and implementing recommendations of results and conclusions. The choice of the direction of scientific research is related to the need to compile an idea of the features and methods of forming the interest policy of the bank. The research used the method of analysis, synthesis, observation and collection of factual information that allowed studying economic phenomena both in parts (analysis) and in general (synthesis).The article examines the factors influencing the interest rates of commercial banks, which depend primar-ily on the macroeconomic situation in the country.

scholarly journals Central bank interest policy: conceptual concepts and socio-economic context

2021 ◽  
Vol 7 (Extra-E) ◽  
pp. 531-536
Author(s):  
Aleksandr N. Sukharev ◽  
Sergey N. Smirnov
Keyword(s):  
Interest Rate ◽  
Central Bank ◽  
Interest Rates ◽  
Interest Rate Policy ◽  
Economic Context ◽  
Negative Interest Rates ◽  
Interest Policy ◽  
Rate Policy ◽  
The Interest Rate

The article reveals the goals and mechanisms of the interest rate policy of the central bank. The role of the discount rate in ensuring financial and macroeconomic stability is shown. The Taylor rule is presented and justified in a modified form, by including the money supply parameter in it. The phenomenon of negative interest rates is revealed.

scholarly journals Monetary Policy Shocks in the Russian Economy and Their Macroeconomic Effects

2019 ◽  
Vol 14 (4) ◽  
pp. 48-75
Keyword(s):  
Monetary Policy ◽  
Interest Rate ◽  
Interest Rates ◽  
Empirical Evidence ◽  
Monetary Policy Shocks ◽  
Interest Rate Policy ◽  
Russian Economy ◽  
Policy Shocks ◽  
Rate Policy ◽  
The Interest Rate

This section conducts an estimate of the impulse response function of key macroeconomic variables to monetary policy shocks in Russia. The estimates are carried out through a dynamic factor model (DFM) of the Russian economy with structural identification of shocks by imposing various sets of sign restrictions on the behavior of endogenous variables. We restricted first the monetary aggregate M2 only (a decrease in response to an increase of the Key rate), and then—simultaneously—M2, real effective exchange rate (an increase), and GDP (a decrease). We estimated the DFM using a large dataset of 58 macroeconomic and financial variables. The estimation results suggest that there is no decreasing response of consumer prices to an exogenous tightening of the interest rate policy of the Central Bank of Russia. This empirical evidence is supported implicitly by DFM-based predictions that under the imposition of such a decreasing response as an identifying restriction to the model, a positive interest rate shock is not transmitted through the interest rate channel of monetary policy to expected increases of the interest rates on commercial loans and private deposits. However, existing empirical evidence refutes this model-based result. Therefore, this study supports the view according to which a tightening of monetary policy in Russia is inefficient in terms of restraining inflation. In addition, monetary policy shocks negatively affect investments, retail sales, export and import, real wages, and employment. Different economic activities react differently to monetary policy shocks: export-oriented activities are not sensitive to these shocks, whereas domestic pro-cyclical activities (e.g. construction) can be substantially depressed in response to unexpected increases of interest rates. Finally, the expectations of economic agents are also significantly affected by shocks in the interest rate policy of the Bank of Russia.

ANALYSIS OF FACTORS AFFECTING THE DEMAND OF RETAIL SUKUK

2021 ◽  
Vol 3 (2) ◽  
pp. 149-164
Author(s):  
Muhammad Abdul Azis ◽  
Adventia Mega Wardhani ◽  
I Wayan Nudra Bajantika Pradivta ◽  
Sendey Prahasto
Keyword(s):  
Interest Rates ◽  
Commercial Banks ◽  
Statistical Tests ◽  
Rapid Development ◽  
Financial Instruments ◽  
Financial Industry ◽  
Factors Affecting ◽  
Factors Influencing ◽  
Ministry Of Finance

The development of the sharia financial industry in Indonesia can be seen from the increase in the number of Sharia Commercial Banks. The rapid development of the sharia financial industry is also followed by the rapid development of sharia financial instruments such as sukuk. Indonesia, through the ministry of finance, has issued 13 Retail State Sukuk types SR001 to SR013, starting in 2012, which has continued to increase in demand from year to year even though it had decreased in SR010 and SR012. Factors influencing the increase in the purchase of State Retail Sukuk are the minimum purchase, interest rates, and ORI coupons obtained by testing the data using statistical tests.

scholarly journals Die Auswirkungen Der Zinspolitik Im Bankensystem Und Bei Immobilienentwicklungen / The Impact Of Interest Rate Policy, On The Banking System And On Real Estate Development

2016 ◽  
Vol 6 (2) ◽  
pp. 13-25
Author(s):  
Pamela Priess
Keyword(s):  
Interest Rate ◽  
Real Estate ◽  
Interest Rates ◽  
Risk Premium ◽  
Real Estate Market ◽  
Liquidity Premium ◽  
Interest Rate Policy ◽  
Rate Policy ◽  
The Interest Rate ◽  
The Impact

Abstract The research purpose is to find out if signs of a real estate bubble are shown at the austrian real estate market right now. Lending rates are composed of different factors: the base rate is the price that the customer is willing to pay. The risk premium is given to compensate the lenders risk of full or partial failure of repayment. The inflation adjustment takes into account the impairment of money over the term of a loan. The liquidity premium increases with extension of the term of the loan. The European Central Bank influences the interest rate policy by varying the interest for money saved there by the banks. At the moment there are used negative interest rates, i.e. penalty interest. The methodology used was that recently the ECB lowered the interest rates which might cause real estate bubbles and, subsequently, banks and economic crises may follow, if interest rates were to be increased again sooner or later. Therefor the author studied the amount of sales and the connection to the interest rates and the interest rate policy of the banks right now. Summarizing it can be seen that in Kittsee, an Austrian area with a lot of real estate sales, as an example, 565 real estate properties were sold in the years 2005 to 2015, the median prices increased in relation to the buyers residence in Austria or non- Austrians at about 375% to 490%, this might indicate signs of change on the market.

scholarly journals Factors Affecting Savings Deposit Decision of Individual Customers: Empirical Evidence from Vietnamese Commercial Banks

2020 ◽  
Author(s):  
Dao Duy Tung
Keyword(s):  
Commercial Banks ◽  
Bank Capital ◽  
Factors Affecting ◽  
Interest Rate Policy ◽  
Rate Policy ◽  
Main Factors ◽  
Spss Software ◽  
Knowledge And Attitude ◽  
Main Input ◽  
Empirical Implications

Capital mobilization is a traditional business of commercial banks and is one of the core foundations for the development of a bank. Capital mobilization is the main input in the operation of a bank, and this is also the basis for generating output for credit activities as well as other banking activities. This study aims to determine the main factors that affect the decisions of individual customers to put savings deposit in Vietnamese commercial banks. Survey data collected from 403 individual customers were analyzed to provide evidence. The results from the multiple regression analysis by using SPSS software revealed that all scales in this study were reliable, and there were six components impacting the savings deposit decision of individual customers from the strongest to the weakest in the following order: the form of promotion, bank brand, service quality, interest rate policy, and employee knowledge and attitude. Besides, the fnding showed customers who have high income tend to have a stronger decision on savings deposits in commercial banks. The main fndings of this article provide some empirical implications for marketers in banks and serve as a suggestion to improve these factors in order to retain and attract individual customers’ savings deposit decisions

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 Negative Interest Rate Risk. Atavism or Normalization of Central Banks’ Monetary Policy

2019 ◽  
Vol 3 (342) ◽  
pp. 89-116
Author(s):  
Irena Pyka ◽  
Aleksandra Nocoń
Keyword(s):  
Monetary Policy ◽  
Interest Rate ◽  
Interest Rates ◽  
Financial Stability ◽  
Global Financial Crisis ◽  
Central Banks ◽  
Interest Rate Risk ◽  
Interest Rate Policy ◽  
Rate Policy ◽  
Negative Interest Rate Policy

In the face of the global financial crisis, central banks have used unconventional monetary policy instruments. Firstly, they implemented the interest rate policy, lowering base interest rates to a very low (almost zero) level. However, in the following years they did not undertake normalizing activities. The macroeconomic environment required further initiatives. For the first time in history, central banks have adopted Negative Interest Rate Policy (NIRP). The main aim of the study is to explore the risk accompanying the negative interest rate policy, aiming at identifying channels and consequences of its impact on the economy. The study verifies the research hypothesis stating that the risk of negative interest rates, so far unrecognized in Theory of Interest Rate, is a consequence of low effectiveness of monetary policy normalization and may adopt systemic nature, by influencing – through different channels – the financial stability and growth dynamics of the modern world economy.

Downfall of the Regulatory System and Triumph of the Market

2020 ◽  
pp. 230-250
Author(s):  
Einar Lie
Keyword(s):  
Exchange Rate ◽  
Interest Rate ◽  
Western Europe ◽  
Regulatory System ◽  
Exchange Rate Policy ◽  
Oil Price ◽  
Interest Rate Policy ◽  
Institutional Legitimacy ◽  
Rate Policy ◽  
The Interest Rate

This chapter discusses how, in the 1970s and 1980s, Norges Bank began to develop instruments with a view to steering economic policy under freer market conditions. However, governments of changing political hues were unwilling to let go of the low interest rate. The oil price fall in 1986 brought an abrupt change in interest rate and credit policy. The government’s tightening actions included the introduction of a more binding fixed exchange rate policy. The frequent recourse to corrective devaluations was to be a thing of the past. Hence, there was a justification for using the interest rate as an ongoing instrument to stabilize the exchange rate. This task fell to Norges Bank. The transition to an independent, active interest rate policy on the part of the central bank was abrupt and came as a surprise. Barely a year before the collapse of the oil price, the Storting had passed a law that made Norges Bank one of the least autonomous central banks in all of western Europe. Ultimately, it was the external situation, and in no sense an increase in government’s and the public’s recognition of the bank and its institutional legitimacy, that restored greater operative autonomy to Norges Bank.

Implications of Central banks’ negative policy rates on financial stability

2018 ◽  
Vol 10 (2) ◽  
pp. 310-320
Author(s):  
Benjamin S. Kay
Keyword(s):  
Interest Rate ◽  
Interest Rates ◽  
Financial Stability ◽  
Global Economy ◽  
Content Type ◽  
Interest Rate Policy ◽  
Trade Offs ◽  
Negative Interest Rates ◽  
Rate Policy ◽  
Negative Interest Rate Policy

Purpose While central bankers have widely discussed the trade-offs of negative interest rates on monetary policy, the consequences of negative rates on financial stability are less well understood. The purpose of this paper is to examine the likely and possible financial stability consequences of a negative rates policy with particular focus on banks, short-term funding markets, foreign exchange markets, asset managers, pension funds and insurers. Design/methodology/approach It draws from international experience with negative interest rates to identify financial stability threats posed to any economy by negative interest rates, and it also highlights where the US experience is likely to differ. Findings In time, financial market threats and other logistical issues of a negative interest rate policy can be managed or overcome. Even cumulatively, these threats are likely to be small as long as the rates remain only modestly negative. However, if the rates remain negative for long periods or they become more sharply negative, the rewards of avoiding negative rates increase. Originality/value Does the negative interest rate policy directly or through these challenges of implementation present a substantial obstacle to achieving financial stability objectives? As policy rates go negative in a greater share of the global economy, the financial stability consequences remain poorly understood and under discussed.

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