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The paper is intended to study the municipal bond issue’s comparative advantages over the alternative debt instruments available to the municipality, as well as the alternative investment instruments available to the investors. On the base of a diagnostic analysis of the development stage of Bulgarian municipal bond market, some assessments, conclusions, and recommendations have been summarized and presented.
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The main purpose of this article is to analyse the financial state of excerpt of 10 firms in the wine-growing branch.The main tasks that we put are:1)To carry out an analysis of the assets, the liquidity, the profitableness, the sales of the production and the profit of some some firms in the branch with the help of the widely used in the practice financial indexes;2)To track out the trеnds, the changes and the dynamics in the financial state of the examinated firms in the period 2002 - 2003 years;
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The continuing globalization of many different aspects of international banking, has led to an increase in the application of tailored technology within the international banking system. This paper discusses one emerging new adaptation and development which is thoroughly altering the traditional links between business and its relationship with the international banking system.
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The first 120 days of 2005 can be defined as one of the most dynamic six months period for the Bulgarian commercial banks. During this period most of the bank managers were pursuing growth, development and expansion by all the legal means. In expectation of the Bulgarian National Bank’s new restrictive measures, bank managers carried out massive advertising campaigns intended to promote low interest bank loans and attract deposits at a high rate of interest. As a result, mortgage rates dropped under 6% and deposit rates of interest increased to 9% per year. That very dynamics in creditor’s activity is a basic precondition for credit risk increase in the bank system.
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The growing deficit in the Bulgarian trade and in the current account is turning with the time in a priority object of concern about the compatibility of the national economy. But the following article illustrates that the main part of the trade deficit is caused by the foreign investment inflow and by the growth of the foreign debt of the private sector of the country. This situation does not justify the contemporary fiscal policy with a “hysterical” accentuation on the budget surplus.
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This paper is intended to present municipal credit rating as one of the most contemporary methods for municipal creditworthiness assessment and a basic precondition for municipal credit market development. On the base of comparative analysis of the world rating agencies’ practice, an adapted credit rating model has been propounded. The model is aimed at assessing municipal creditworthiness in Bulgaria, by binding the concrete dynamics of the qualitative and quantitative indicators included in the model to the macroeconomic framework, governmental policy, and intergovernmental fiscal relations in the country. Applying the adapted credit rating model in Bulgaria is an important precondition for development of an active, stable, and liquid municipal credit market, capable of ensuring significant advantages for the country during the accession process.
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The text deals with co-operative banks in Italy. The authors intend to highlight the role of co-operative banks, their functions and territorial specificities. The term “co-operative banks” implies two different types of credit intermediaries integrated in a system that has as its reference model the one of universal bank: the community banks and co-operative banks. While sharing some distinctive features, the two types of cooperative banks in Italy show significant differences for both the historical evolution of the respective institutional models and about the operation that in time characterized them. The co-operative banks combine the social and cultural growth of the territory to the economic, social and co-operative business partner-stockholders-clients and business partnerstockholders-employees. In the special chapter, was made a reference to the forms of co-operative credit in Serbia. In the final chapter was made the research proposal.
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Encashment is important for providing cash to banks and their clients. The last five years have shown that the risks related to the bank and cash transportation are growing. The main threats are connected with a whole group of criminogenic factors and the presence of organized criminal groups. This study shows that in addition to the up-mentioned factors high frequency of incidents relates to both unintentional and intentional abuses committed by the collection personnel. All cash collecting companies operating in the country make daily efforts to reduce the incidence and severity of risk. Research objectives of the study are aimed at detecting risk spectrum threatening the processes of cash movement from customers to their banks and the negative economic effects of their implementation. An empirical survey is carried out among companies engaged in collection activity and banks which use their services to disclose risk profile.
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This paper examines the factors that determine the profitability of the banking sector in Bosnia and Herzegovina, measured by return on assets and net interest margin in the period 2008-2014. As the independent variables we used internal variables specific to the operations of banks, as well as external variables that represent the most important macroeconomic indicators. The analysis showed that the most significant impact of internal variables includes: cost-assets ratio of permanent and total assets, and the scope of the bank. When it comes to macroeconomic variables, inflation shows a significant effect on the movement of profitability of the banking sector in Bosnia and Herzegovina.
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In this study we focus on public development banks in order to see how effective their support has been on the SMEs performance and growth. The Republic of Srpska Investment-Development Bank (in Serbian: Investiciono razvojna banka Republike Srpske – IRBRS), provided the empirical context for our research. We explored the impact of IRBRS loans on selected business performance indicators: sales, profit and capital of SME borrowers. The study was based on the comparison of selected performance indicators during the five-year period before (2003-2007) and the five-year period (2009-2013) after using IRBRS loans. The selected indicators were also compared with those of the control group, non users of IRBRS loans. The results based on the representative sample of SMEs in the Republic of Srpska show a positive impact of IRBRS loans on sales, profitability and capital of SME borrowers, therefore confirming the positive impact of public development banks on the SMEs performance and growth.
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The term "portfolio analysis", introduced in the economic theory by Harry Markowitz, is not a new term in scientific literature. However, analysis and criticism in the papers of local and foreign authors are mainly based on the examples of developed capital markets. There are very few cases of application of the portfolio analysis in the domestic capital market. The focus of this paper is on implementation of diversification of the bonds on the Banja Luka Stock Exchange. Using Markowitz's portfolio selection, we will prove that diversification, including all limitations, is possible and applicable onto the domestic bonds in the capital market.
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The survey presented the development of policies on banking supervision in the European Union. It was found that the process of integration marked positive results in carrying out banking activities within the European Union, while the banking supervision remains fragmented and concentrated on a national level. The survey results highlight a trend towards coordination and unification of banking supervision in the EU. The analysis shows that the effects of the global crisis challenge the stability of cross-border banking groups and the security of the financial system of Member States. Actions taken to deal with the crisis create new practices to the joint responsibility of national supervisors.
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Modern finance faces the challenge of the continuous improvement and expansion of risk measurement at the national and international level, particularly of understanding the psychological risk measures used by investors and, consequently, a need for better risk management. The aim of the study is to present the problem of the need for risk measurement, which modern finance has to confront. In order to achieve this aim, the essence of risk, uncertainty, and risk measures has been discussed. The research methods applied include an analysis of a measure of investment portfolio with the use of the value at risk (VaR) and an analysis of the DOSPERT psychometric scale with the use of psychological and financial investment risk.
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The paper focuses on FX prime brokerage (FXPB) service, provided by brokers (mostly large banks) to their clients, which consists in enabling them to trade with other banks using their prescreened credit and in their name (e.g. by providing them with access to electronic platforms that are only available to a limited group of dealers). The aim of the paper is to indicate the role of prime brokers in the creation of forex turnovers. The methodology used in the paper is based on the analysis of specialist literature and data collected by the Bank for International Settlements (BIS) from market-makers (the most active financial institutions making different foreign exchange transactions, often named ‘reporting dealers’). The results of the survey of the global forex market organized by the BIS are provided regularly once every three years, last time in April 2013. The results of the April 2016 research will be published in December 2016 or next year. As previous BIS analyses didn’t touch the problem of prime-brokered transactions in the global forex market (there is a lack of advanced statistics on prime-brokered transactions in the forex market), the paper focuses on data from April 2013 only. FX prime brokerage service has been contributing to the growth of the forex market from the very introduction of FXPB to the banking offer in the early 1990s. From many years there has been a tendency to make the foreign exchange market more open and to facilitate investors to access its services. FXPB enables smaller financial institutions (mainly hedge funds) to trade with large commercial and investment banks, which would remain out of their reach without the help of FX prime brokers. The growth of the foreign exchange market turnover is due to the growing activity of the customers of prime brokers.
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A model of economy relying on the free market principle is presented in this paper. In practice, in addition to the primary model there is also a dual model. The quantity of produced goods is taken as the primary variable, and calculated price is used as the dual variable. We will see to what extent economic principles model the economy. It will be shown that in economic balance all companies behave like they belong to a single large company which maximises its profit.
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With each new financial crisis, the issue of regulation and the effectiveness of the proposed measures and solutions aimed at combating the crisis. In this paper the author use comparative and historic method, analyzing the implications of the financial crisis on the capital market, as well as the market as a whole. In the introductory part of this paper, the author explains the uprising of the stock exchange crash, citing a number of factors that can lead to the stock market crash and the collapse of the financial market. The second part is dedicated an overview of the major stock exchange crashes in history, with special references to the implications produced by these crashes. In the last part of the paper, the author gives a brief overview of the operations on the Belgrade Stock Exchange, as well as the characteristics of the local financial market. In the conclusion the writer points to the importance of the stock exchange in the modern business environment, in order to prevent crisis, and/or mitigate the existing crisis.
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Although financial integration and convergence of EMU member countries reached a high level, the financial crisis, that has developed into a banking and debt crisis, has caused an intense process of fragmentation of financial markets along national borders. This significantly complicated the implementation of the single monetary policy and disrupted the monetary transmission mechanism. Furthermore, in EMU, the crisis was much more intense than in other economies, and was rapidly transmitted among Member States. Besides, the contagion spread quickly from banks to sovereigns and vice versa, creating a “vicious loop” between banks and national finances. This paper attempts to show that adequate, strong and politically independent supranational bank regulation and resolution is necessary for the viability of banking sector, but also the economies in European monetary union. It should restore the market confidence and harmonize the rules of the game in the single financial market. Although the project is on its very beginning, there are some first encouraging results.
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The essential research intention in this paper is oriented toward considering the nature of money multipliers and their impact on inflation in Republic of Serbia. The analysis of research data includes data during period of 1997-2015 in order to achieve more effective results. Obtained results, after implementing adequate statistical procedures, emphasize the existence of negative and significant correlation between money multiplier m3 and inflation. Since M3 represents basis for forming m3 multiplier, this implicates that wider range of assets in monetary aggregate M3 have greater impact on inflation than other two monetary aggregates. Therefore, one of tasks for central banks should be higher control of M3 through m3 money multiplier analysis in order to prevent higher fluctuations in inflation rate.
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The paper examines banking distribution channels and post-crisis developments in the Romanian and Bulgarian banking systems and aims to pin down the differences and similarities in both countries. The two phases related to the financial crisis, before 2008 and after 2008, reflect specific developments in terms of policies and distribution channels chosen by the banks to deliver banking products and services. As a result of the global financial crisis the networks of branches were reshaped, contracted and/or redesigned, in order to sustain the new vision. Technology and digitalization determine an important side-effect resulting in a “quality-based” retail banking trend. A mix of channels, both traditional and digital support the new relationship banking with all categories of customers, both retail and corporate.
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Purpose: The aim of this paper is to examine shareholders’ reaction to the decision of the supervisory board to appoint a CEO in companies listed on the Warsaw Stock Exchange.Methodology: An event study and the mean-adjusted model were applied. The abnormal returns were measured as the CAAR in the entire (-60, + 60) window and selected sub-windows.Findings: The obtained values of abnormal returns indicate the shareholder’s negative reaction. Throughout the observation window, they oscillate slightly below zero, and in the window (0, +20) they are negative at -1.566%. Irrespective of the observation window, negative abnormal returns were obtained for over half of the observation (52–57%). Therefore, preliminary results indicate the predominance of the information effect over the real one. The decrease in market value as a result of the event may result from an increase in investors’ uncertainty as to the effects of changes in strategy and skills of the new CEO.Originality: The research is a unique one. To date, no one has carried out research into shareholders’ reaction to a CEO appointment in either the Polish or Central and Eastern European capital markets. They primarily bring the value of cognition of shareholders’ behaviour in the analysed event, which is reflected in share prices. They extend the literature on the signalization instruments, i.e. the activities that boards can undertake due to the new information transmitted to the capital market participants and stakeholders. The market reaction to a CEO appointment will without a doubt interest investors; the institutions responsible for supervision (which in the case of Poland is the Financial Oversight Commission) and the legislator in charge of regulations that prevent insider trading while promoting corporate disclosure transparency.
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