Financial Market Institutions Research Articles

Население как участник фондового и срочного рынков: ожидания, риски, перспективы

The relevance of the article is due to the fact that the instruments of the stock and futures markets are currently considered by the population as an attractive alternative to traditional investments in bank deposits. This category of inves-tors, which ten years ago did not have any noticeable weight on stock and fu-tures markets, is gradually turning into active participants in the securities market, capable not only of ensuring the efficiency of the Russian economy, but also of overcoming market risks. The subject of the study is the activity of retail investors in the domestic finan-cial market during the period of tightening anti—Russian sanctions. The pur-pose of the work is to consider the specifics of citizens' investment behavior, identify the main trends of the current period and factors contributing to the further development of the investor protection system and increase citizens' confidence in financial markets. The article identifies the peculiarities of the de-velopment of the retail segment of the domestic market in the period 2022–2023, and on this basis it is concluded that the sanctions regime has caused significant damage to the Russian financial market, however, the degree of im-pact of the negative processes constraining its development turned out to be less significant than predicted by most researchers. The continuation of the regulator's work in terms of developing additional measures to protect inves-tors' rights and improve financial culture, coupled with the implementation of initiatives by trade organizers and the professional community, will make it possible to counteract the spread of unfair trading and marketing practices, improve the investment climate in the country, and strengthen the confidence of private investors in financial market instruments and institutions.

РОЛЬ ESG-ІНВЕСТУВАННЯ В ЗАБЕЗПЕЧЕННІ ІНКЛЮЗИВНОГО РОЗВИТКУ ПІДПРИЄМСТВ, РЕГІОНІВ, ДЕРЖАВИ

The article presents the results of a study of the content of the concept of inclusive development of economic systems in modern conditions and outlines the priority areas of responsible financing as a mechanism for overcoming the current political challenges and post-war reconstruction of the Ukrainian state. The importance of the environmental, social and governance component (ESG factors) as investment benchmarks in the context of ensuring inclusive development and achieving sustainable development goals is proved. The evolution of methodological tools for assessing the effectiveness of social responsibility of business and ESG parameters is analysed. The article establishes that algorithms for effective comparison of ESG investment performance are currently available to investment investors, which allows them to qualitatively measure, evaluate and manage processes in the field of responsible entrepreneurship. The global trend towards the implementation of the ESG approach by key financial market institutions of the world is identified and the dynamics of growth in the number of ESG exchange-traded funds is summarised. The positive achievements and inhibiting factors on the way to scaling the ESG transition in the strategies of domestic companies are outlined. The current state of implementation of ESG factors in the Ukrainian business environment is determined. The discrepancy between declarative approaches to the development strategies of companies and the content of their non-financial reporting is revealed. The national portal is evaluated in the context of presenting and promoting key ESG aspects. The need to increase attention to ensuring inclusive development of the state and its economic systems within the framework of ESG strategies as one of the priority solutions in the context of post-war reconstruction of the country was identified. The practical impact of ESG investing on the inclusive development of systems of different levels – from corporate to macroeconomic – is diversified. The article emphasises the interconnection and interdependence of social values with fiduciary benefits, which makes it a priority to further search for incentives to attract business structures to socially responsible entrepreneurship at the state level.

Financial Market Abuse and Irregularities as Legal Risk Factors in the Activity of Insurance Intermediaries in Poland. Part II

This two-part study aims at identifying occurrences related to market abuse and irregularities in the financial services sector and their impact on the operation of insurance intermediaries in Poland. While analyzing Polish and foreign literature as well as reports published by financial market institutions, the author discusses various examples of such incidents, which are not only characteristic of domestic market practice, in order to identify the sources of legal risk. Furthermore, he indicates the threats which influence the operation of insurance intermediation entities, which results in the necessity to establish and implement appropriate legal risk management processes. Part II of the article is devoted to such risk factors as: unfair market practices, practices infringing collective consumer interests and/or insurance offences.

Financial Market Abuse and Irregularities as Legal Risk Factors in the Activity of Insurance Intermediaries in Poland. Part I

This two-part study aims at identifying occurrences related to market abuse and irregularities in the financial services sector and their impact on the operation of insurance intermediaries in Poland. While analyzing Polish and foreign literature as well as reports published by financial market institutions, the author discusses selected examples of such incidents, which are not only characteristic of domestic market practice, to indicate the sources of legal risk. What is more, he points out that these factors pose a threat to the operation of insurance intermediation entities, thus creating the necessity to establish and implement appropriate legal risk management processes. Part I of the article focuses on risk factors related to misselling on the insurance market.

Access to drinking water and sanitation in developing countries: Does financial development matter?

ABSTRACT The aim of this study is to examine the effect of financial development on access to safe water and sanitation. Using panel data from a sample of 106 developing countries over the period 2000–2019, empirical results based on two-step system generalised method of moments suggest that financial development improves access to drinking water and sanitation for the total population and for both urban and rural populations. In addition, financial development reduces the gap between urban and rural populations in terms of access to these two basic services. Further analysis also suggests that the financial market and financial institutions, as well as their sub-indices (financial depth, financial access, and financial efficiency), also improve access to water and sanitation. These results underscore the need for continued efforts to design and implement policies that promote financial development. In addition, given the greater impact of financial institutions, we suggest that reforms to improve the financial system should be more oriented towards the development of financial institutions.

Measurement of the contribution of financial factors to GDP: Evidence from India

To measures the contribution of various indicators of financial market and financial institution to GDP in India for the period of 2000 to 2020. This research measures the contribution with the help of augmented dickey fuller (ADF) test, cointegration test and vector error correction model (VECM). Given results suggest that financial factors are having major effect on GDP in long-run. Indicators of financial market and financial institutions has a contribution in the growth of GDP. Following research measuring the contribution of various factors on GDP. Up to what extent each indicator contributes in the growth of GDP in India. Prior studies emphasized the consequences of financial issues together on the expansion of the economy.

ФИНАНСОВЫЙ РЫНОК И ФИНАНСОВЫЕ УСЛУГИ: РЕГИОНАЛЬНЫЙ АСПЕКТ

The article examines some problems of the functioning of the financial market and the use of available financial services instruments on the example of the North Caucasus Federal District. The applied instruments of financial services in the region and their saturation in the subjects of the North Caucasus Federal District are investigated. The most widespread financial market institutions and instruments that contribute to the development of both payment and financial services in the region are highlighted. New instruments of long-term investment products are presented, which should contribute to increasing long-term resources for project financing of priority projects.

Moving from Intentions to Actions in Youth Entrepreneurship: An Institutional Perspective

AbstractSituational factors may facilitate or frustrate the translation of entrepreneurial intentions into subsequent actions. In this study, we use data from two waves of a large-scale cross-country study of student entrepreneurship, the Global University Entrepreneurial Spirit Students' Survey (GUESSS), conducted in 2011 and 2013/2014 (n = 1434 students from 142 universities in nine countries), in order to investigate the impact of country-level institutions (financial market institutions and legal institutions) on the link between entrepreneurial intentions and subsequent start-up activities. We find that the quality of legal institutions has a significant positive impact on the translation of intentions into actions, whereas the quality of the national financial system does not influence the intentions-actions link. Theoretical and public policy implications are discussed.

НОРМАТИВНО-ПРАВОВЕ ТА ІНФОРМАЦІЙНЕ ЗАБЕЗПЕЧЕННЯ РЕГУЛЮВАННЯ РИНКУ ПОХІДНИХ ФІНАНСОВИХ ІНСТРУМЕНТІВ В УКРАЇНІ

The purpose of the article is to structure the legal framework for regulating the market of derivative financial instruments at the global and national levels, to harmonize them with each other and to identify current changes and problems. The article uses an economic and legal approach to the study of the problems raised. It has been established that the structure of regulation of the derivatives market consists of supranational and national levels. At the supranational level, global and regional financial market institutions determine the basic provisions for the functioning of the market; at the national level, it is regulated by legislative bodies, state regulatory bodies and self-regulatory organizations. The regulatory support of state bodies in the capital market is formed by instructions, standards and norms, methodological guidelines, explanations, rules, etc. The attention is focused on the important role of European supranational institutions as factors of adaptation of the Ukraine financial system to EU requirements. It has been established that the Ukrainian model of financial regulation is close to the “two peaks” model, in accordance with which the main functions are distributed between institutes – by the National Bank of Ukraine and the National Securities and Stock Market Commission. The functions and powers of all components of the derivatives market regulation system, including self-regulatory organizations, are considered. It is noted that in Ukraine derivatives trading outside the organized market is poorly regulated and requires the use of tools aimed at standardizing processes (General Agreement) and enhancing depository and clearing activities. The level of Ukraine derivatives market development is characterized as the active phase of the rule-making processes regulating. The legislative bodies have a decisive influence on the system of regulation of derivatives market at the national level. They form a legal framework and have a clear hierarchy. The key subjects of information support of the financial market are identified, their functions and the state of disclosure of information are determined, the main problems of the informational support require solution.

The Influence of Covid-19 on Subprime in the U.S.

Subprime lending in the United States was a major concern after the 2008 financial crisis. While Covid-19 is sweeping the world, how will the US government and financial institutions deal with the potential crisis of subprime mortgage will be discussed in this study. Financial market institutions and the US government should both change their strategies to deal with the crisis. In addition to controlling the spread of the epidemic, the US government should temporarily lower the minimum wage and provide a series of quantitative financial subsidies. Financial institutions should also update loan data and use better monitoring and regulation to reduce subprime risk to cope with this potential crisis.

Modeling the activities of financial institutions in changing macroeconomic conditions as a stability factor of the economy

This article is devoted to the study of the activity of financial market institutions in modern conditions, the main feature of which is the constant change in the conditions of the institutional environment and macroeconomic stability. Scientists have proved the increasing importance of financial institutions in ensuring the economic growth of the economies of States in the XXI century. The authors consider and systematize the approaches of different authors and representatives of different directions of institutionalism and economic science to the definition of the role and essence of financial institutions. Also, the main conclusions about the impact of the global financial and economic crisis of 2008-2009 and sanctions of Western countries on the activities of the institutions of the Russian financial market in 2018 are formulated, based on the collection of statistical data, calculations are made and a model is formed, as a result of which a number of conclusions are obtained. As a result of calculations of the mathematical model made in the MS Excel program on the basis of statistical data of the Central Bank of Russia characterizing a condition of the financial market in 2008, 2009 and 2018 it is revealed that in economy of Russia there were considerable changes. The proposed model of assessing the institutional impact of financial institutions on economic growth as a practical tool can use a larger number of statistical indicators for calculations and obtaining more accurate data to solve more complex scientific and practical problems.

Development of digitalization mechanism of institute of financial ombudsman on example of Ukraine

The object of research is the problem of the rights violation of consumers of financial services. The institute of financial ombudsman is important for this function. This is the person who successfully performs the function of settling disputes in many countries around the world. The authors have developed a mechanism for digitalization of the institute of financial ombudsman, which will help in resolving disputes and preventing them through a special electronic platform of the financial ombudsman, which would optimize the cooperation of consumers of financial services with the ombudsman. This model of interaction with the mediator will be especially useful during a pandemic, COVID-19, in particular. Let’s believe that the process of appealing to the financial ombudsman through electronic systems for submitting and receiving the information will ensure the efficiency of service delivery, equal access to the procedure of consultation, and protection of all segments of the population. Analytical review of consumer protection violations was carried out based on statistical data of Ukraine, but the proposal to introduce a mechanism for the financial ombudsman digitalization is quite simple and universal for implementation in many countries. Statistics on complaints about violations in the provision of financial services in both the banking and non-banking financial sectors indicate the need to pay more attention to simplifying citizens' appeals to the regulator. The authors' survey of young people confirmed a low level of trust in banking and non-banking financial market institutions. It is important that the mediator actively participates not only in the stage of appealing disputes but also in preventing them in the form of dialogue with the consumer and the implementation of the rights and obligations of both parties. This will ensure a high level of financial inclusion, increase public confidence in the financial sector, as well as the level of financial literacy of the population.

The National Reconstruction and Continuous Development Act of 2021

For the past 50 years at least, many American economists and policymakers have erred in their implicit understanding of ‘economic development.’ Instead of the perpetual process of technological advance and responsive macroeconomic adjustment that it is, development has been conceived as a one-off achievement through which ‘underdeveloped’ countries become ‘developed’ countries, then coast on their technical laurels. Likely stemming as it does from Cold War competition for influence over ‘underdeveloped’ countries up till the 1990s, this ‘takeoff’ conception and strategy of economic development, first associated with U.S. National Security Council economist Walt Rostow, is ripe for replacement. The present author’s InvestAmerica Plan is one such prospective replacement. This proposed bill would for its part now institute the InvestAmerica Plan. Like the Plan itself, the Bill accordingly aims to work ‘big,’ transformative changes by levering four surprisingly minimal ‘tweaks’ to existing federal instrumentalities. These are as follows. First, the heads of all cabinet-level executive agencies of the United States with jurisdiction over primary infrastructures and industries are organized into a strategic development planning body – the National Reconstruction & Development Council (‘NRDC’). The Council is charged with developing, regularly updating, and overseeing the implementation of a National Development Strategy (‘NDS’) analogous to the nation’s regularly updated National Defense Strategy and Defense Posture Statements formulated by its defense and security agencies. This task includes, among other things, the functions of (a) identifying sectors and Congressional Districts in need of concerted startup assistance, and (b) approving responsive projects, entities, and investment securities as Eligible targets of development investment. Second, the Federal Financing Bank (‘FFB’) through which Treasury already funds federal agencies is upgraded with respect to fund inflows and outflows. Inflows will continue to include Congressional appropriations and proceeds of Treasury Securities sales, as presently, but will also include additional public and private sector capital raised through Special Purpose Trusts funding diversified portfolios of Eligible NRDC-designated national development projects. Outflows for their part will continue to include credit-extension and –support afforded to federal agencies, again as at present, but will now also include debt, equity, and hybrid investments in both (a) sub-federal units of government, and (b) private sector firms and consortia of private sector or mixed public-private sector firms designated as Eligible by the NRDC. Third, the Federal Reserve System is restored to its original role as a network of regional development finance institutions (the Federal Reserve District Banks) overseen and coordinated by an independent executive agency (the Federal Reserve Board of Governors). The Act does this by requiring the Fed to employ its Federal Reserve Act Section 10B, 13, and 14 discounting powers to seek out and afford short- to medium- term liquidity assistance to small businesses designated as Eligible by the NRDC. This form of proactive productive lending, mandated by the text of the Federal Reserve Act itself since 1913 but in recent decades ‘honored only in the breach’ by the Federal Reserve System, is to replace, where allocative trade-offs have to be made, the speculative lending to secondary and tertiary financial market institutions that the Fed presently favors. Complementary adjustments to the Comptroller of the Currency’s bank-chartering and portfolio-regulatory mandates, and to the Federal Deposit Insurance Corporation’s capital-regulatory mandate, round out this ‘Spread the Fed’ pillar of the Plan. Finally fourth, the Act requires the Department of Treasury to upgrade its present TreasuryDirect system of citizen-accessible Treasury Securities accounts in two ways. First, U.S Digital Service is instructed to upgrade TreasuryDirect Accounts into universally available peer-to-peer (‘P2P’) digital wallets through which Treasury, all citizens, and all approved businesses and guests can transact with each other. And second, the resultant wallets are enabled to receive, hold, and pay out digital Federal Reserve Notes (‘dollar bills’) in addition to the Treasury Notes, Bills, and Bonds presently authorized to be held. The upshot is a universally accessible digital savings and payments platform that will not only eliminate the problems of commercial and financial exclusion and ‘leaky’ monetary policy, but also facilitate the efficient and high-velocity operation of those new functions established by the first three pillars of the Plan elaborated above.

Current trends in household finances of Ukraine

The article considers the peculiarities of the functioning of household finances in Ukraine in modern conditions, examines their place and role in the financial system of the country. The basic functions of household finances are specified and it is determined that the household is an important subject of financial relations, which interacts with the state, economic entities, financial market institutions, continuously creates incoming and outgoing cash flows, the size of which tends to increase. The sources of income generation and expenditures of Ukrainian households have been clarified, as a result of which we can state the dominance of wages and social benefits in income and consumption expenditures in total household expenditures, which significantly reduces their investment activity. The analysis of statistical data characterizing the financial condition of households in Ukraine was carried out and the growth of nominal values of such indicators as total income and expenditure of households, minimum and average wages, pension, social assistance, subsistence level was noted. In 2020, there is an increase in unemployment in the country, which has a negative impact on household income, reduces solvent demand and creates an additional burden on the budget. A study of the financial condition of households in the context of the coronavirus epidemic and the introduction of quarantine measures in Ukraine. We note its deterioration and note the low level of savings of the population, which leads to a decline in living standards and the need for government support. The key problems in the sphere of household finances are formulated and perspective directions of their development are determined, the use of which will allow to increase the level of well - being of households and will have a positive impact on the socio - economic situation of the state as a whole.

Стратегічні вектори розвитку територій на мікрорівні

Розглянуто основні стратегічні вектори розвитку територій на мікрорівні: адміністративно-правові, фінансові, технологічно-інноваційні, децентралізаційні, виокремлено проблеми реалізації заходів за цими напрямами, які існують на сучасному етапі. Акцентовано на важливості процесів децентралізації, які безпосередньо впливають на територіальний розвиток, та, з огляду на зміни, обґрунтовано потребу поглиблення децентралізаційних перетворень у державі.

Influence of collateral and age on corporate capital structure

Being financed by third-party capital requires the companies to put up collateral or assets in guarantee, consisting of real estate, inventories, and accounts receivable that in turn depend on specific life cycles, among other aspects. The main object of this study is to analyze whether corporate debt is related to age and collateral. To do so, a sample of 194 public and private Brazilian companies was studied between 2010 and 2017. The findings indicate that more mature businesses have lower debt levels. In terms of the collateral variable and interactions between collateral and age, a negative relation was noted with financial leverage, contrary to what was expected. This fact indicates a possible lack of quality in collateral over time. Furthermore, it is noted that there is no directly proportional relationship between progression in age and collateral. The contribution of the study consists of analyzing the relationships between collateral and age in terms of the debt levels of public and private Brazilian businesses. The distinctions between these groups may throw light on organizations in the emerging countries in terms of how to handle financing decisions with financial and capital market institutions.

Crowdfunding in the Wider Perspective Investment Crowdfunding: Competition Between Regulations, Institutions, and Economic Freedom

Abstract The aim of this article is to present Investment Crowdfunding (ICF) in a perspective wider than merely as a new form of financing a certain category of business ventures. Selected aspects of ICF as a phenomenon that is a manifestation of the conflict between economic freedom and regulations and financial market institutions will be emphasized. New concepts of the part of the modern economy in the period of digitization, referred to as the collaborative economy, mesh economy, or sharing economy, should also be taken into account. The issues of excessive and restrictive regulation of the financial market will be presented in this context, as well as the constraints and risk factors of ICF operation and the Polish ICF experience. The study hypothesises that Investment Crowdfunding is a viable alternative for financing micro and small economic projects, if compared to the traditional and over-regulated forms of financing. The usefulness of Investment Crowdfunding concerns primarily economic projects of the start-up category. The study uses the following research methods: critical analysis of the literature of the issue, descriptive and comparative analysis, case study, and deduction. The theoretical considerations and examples presented in the article should be treated with appropriate research caution. However, they make it possible to positively verify the hypothesis.

The collateral liquidity problem in contemporary finance and the resurrection of quantity theory

Since the 2008 crisis, the liquidity of collateral has become a serious concern for financial market institutions and regulators due to its increased importance in risk and cash flow management. Surprisingly, market participants mobilize old-fashioned economic theory, such as Irving Fisher’s quantity theory of money in their discussions of how to deal with the new problems of collateral liquidity. Today, ‘collateral is the new cash’, as one sector report claims, marking a shift from a quantity theory of money to one of collateral. Liquidity, I argue, poses not only practical problems to market participants and regulators, but also epistemic ones. Accordingly, practitioners not only produce practical but also theoretical responses to it, mobilizing classical economic theory in so doing. The problem of liquidity is shown to relate closely to a problem of ‘sovereignty’ in the narrow sense of guaranteeing the safe value of collateral. Contrary to established conceptions, sovereignty in this sense is not limited to states, but can also occur with monopolistic agents in the market such as global custodians. Thus, following the recent decade of crisis, general epistemic problems of liquidity and sovereignty in contemporary finance become visible through the practical problems and solutions in relation to collateral – specifically in the practical problems of buttressing liquidity in its double nature of collateral velocity and quality or safety.

Управление европейским рынком финансовых услуг — институциональный подход

The article discusses regulatory regime of the European financial market in its institutional aspect. Research is done as a comprehensive analysis of institutionalized European Union financial market as a complex of the five elements that determine it, namely: (1) MiFID, (2) MAR, (3) EMIR, (4) CRR and CRD, (5) AMLD. The development of financial market institutions is derived as ex-post and ex-ante reactions that determines the logic of establishing anew and transitioning to updated regulatory regimes (MiFID => MiFID II, AMLD III =>AMLD IV => AMLD V, Basel II => Basel III).

The state policy of service sector development in the Republic of Kazakhstan

Scientific-methodical approaches of identifying the main factors for attracting deposits in the Ukrainian banking system are presented in this paper. The author offers the following procedure: a comparative analysis of the long-term dynamics (2000–2017) of the placement of deposits in Ukrainian, Belarussian, and Polish banking systems as a result of socio-economic development trends in these countries; an estimation at the macroeconomic level of the factors influencing this process, using methods of principal components analysis and factors classification; and detection of regression-correlating dependencies between the grouping variable (deposit volume) and variables of analysis through the sample regression function identification for these countries. The theory that attraction of deposits to the Ukrainian banking system was turbulent due to both the insufficient development of other financial market institutions and the prudent behavior of national economy agents is substantiated. Activation of bank deposit activity was found to be connected with measures of demographic situational improvements, thus ensuring the economic freedom of business entities in a hybrid war with the Russian Federation.