Abstract
The article substantiates the need to increase the efficiency of banking activities in the context of transformational processes which take place in the world in general, and in particular inUkraine. In today’s environment, when banking business becomes more risky, the efficiency of bank activity becomes the basis for making management decisions in banking institutions and establishing mutually beneficial relations between banks and their clients.The author emphasizes the effectiveness of the distribution of banking business to profit centers, which allows to determine the financial result of certain areas of banking business and effectively redistribute bank resources inside the bank. They claim that one of the most risky areas of banking is the purchase and sale of monetary resources, as the financial result of the business and its direct effectiveness depend on the correct pricing of resources. To this end, the article proposes a method for determining the profit centers of the bank and assessing the effectiveness of their activities.The necessity of using transfer pricing in the conditions of the division of banking business to profit centers to improve the method of determining the financial result from banking activity is also grounded in this research. The principle of conditional purchase and sale of resources is used to determine the financial result of the activity of the profit center of the bank. It is an integral part of the methodology for assessing the activity of related business units in the risk-return system. The essence of this principle is that all resources that are attracted to the bank by one unit are conditionally sold to other units of the bank. The author presents his vision for managing the transfer pricing process in Ukrainian banks, which will positively affect the dynamics of banking business performance indicators. It is shown that transfer pricing systems play a significant role in calculation profitability and effectiveness of profit centers on active and passive operations, which makes it possible to consider transfer pricing as a tool for managing the interest rate risk of a bank. The main terms for constructing resources transfer price are defined: transfer price BID, transfer price offer, stimulation margin.
Highlights
In current conditions when banking business gets more and more signs of risk the bank’s efficiency becomes the basis for making managerial decisions in banking institutions and establishing strong and mutually beneficial relationships between banks and their clients
The problem of accurate pricing on bank resources is of particular importance, as it serves as a guarantee of the bank’s optimal profit, and the efficient operation and financial stability of the banking institution
One of the most hazardous areas of the banking business is the purchase and sale of cash resources, since the financial result of the market and its direct efficiency depends on the correct formation of the price of funds
Summary
In current conditions when banking business gets more and more signs of risk the bank’s efficiency becomes the basis for making managerial decisions in banking institutions and establishing strong and mutually beneficial relationships between banks and their clients. One of the most hazardous areas of the banking business is the purchase and sale of cash resources, since the financial result of the market and its direct efficiency depends on the correct formation of the price of funds With this purpose, the authors proposed a method for determining the centers of profit of the bank and assessing the effectiveness of their activities. Conditional fee and costs are charged on so-called transfer prices (or rates) that reflect the market situation, the reserve norm, etc This mechanism allows you to enter incomes and expenses for each center (direct or conditional), which will enable you to determine the final financial result of its activities [3].
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