Regulation Of Banking Activities Research Articles

"Екологічний" вектор регулювання діяльності банків: модель ЄС

Ukraine is on the verge of joining the European Union, which requires, on the one hand, the transformation of the regulation of banking activity in accordance with the standards adopted by it, and on the other hand, the implementation of the concept of sustainable financing in all spheres of public life, including the banking system. Recently, a stable trend has emerged in the countries of the Euro zone, which consists in liaison of the mechanism of regulation of banks’ activity to the goals of sustainable financing, which makes it necessary to do changes to the existing standard of requirements for the capital of credit institutions (CI) and to regulate its adequacy. The mentioned metamorphosis has also spread to the banks of Ukraine, which are only taking the first steps in the direction of introducing the key principles of sustainable financing into their practical work. Along with the above, in the near future the domestic banking sector may face the problem of "greening" the mechanism of regulation of their activity according to European standards, directives, regulations and guidelines. Solving this extremely difficult problem will require the NBU to take decisive and, at the same time, well-balanced measures, which would not hinder the active development of investment and lending in a sustainable economy. The aim of the study is to reveal the key provisions of the regulation of banks in the EU, to determine the vectors of their change in accordance with the goals of sustainable financing, as well as to develop recommendations for the banking sector of Ukraine. In this research, methods of scientific knowledge were used, in particular: obser­vation, theoretical generalization, ab­stract­tion, comparison, analysis and synthesis, induction and deduction. The main provisions of the Directive on capital requirements and regula­tion of capital adequacy of banks in the European Union are outlined. The essence of harmonious finance and the stages of its transformation in EU countries are revealed. The ecological vector of the regulation of banks’ activities was considered, and the difficulties and prospects of its implementation in the banks of Ukraine were determined. A "chain" of step-by-step implementation of the NBU’s "environ­mental" regulatory initiatives in Ukrainian banks is proposed based on the best European practices and the possibilities of their imple­mentation in a country at war.

Determination of the Industry Nature of Public Law Regulations Governing Banking as a Basis for Resolution of Practical Conflicts

The article touches on both general theoretical and practical issues of the importance of determining the sectoral affiliation of legal norms for resolving emerging legal conflicts. As an example, the author explores the problem of interaction between Article 74 of the Law on the Bank of Russia and Articles 15.26, 15.27 of the Administrative Code of the Russian Federation, which often leads to arbitrariness on the part of the Mega-Regulator. Attention is drawn to the manifestation of distortions in the principle of independence of the Bank of Russia in the form of a 20-year confrontation with court decisions on disputes on bringing credit institutions to responsibility. The resolution of contradictions between legal norms is proposed to be carried out on the basis of the constitutionally enshrined principle of legal equality, the guarantee of which is the codification of provisions on public liability. The correlation of financial and administrative law in the regulation of banking activity is analyzed and the absence of any features for the assertion of the existence of financial and legal responsibility is revealed. The author comes to the conclusion that it is necessary to exclude compositions providing for administrative liability for violation of banking legislation from any legislative acts, except the Administrative Code of the Russian Federation, in order to ensure consistent and predictable legal regulation.

RESOURCE POTENTIAL OF COMMERCIAL BANKS AS AN INDICATOR OF FINANCIAL STABILITY AND RELIABILITY OF THE BANKING INDUSTRY IN THE CONTEXT OF EXTERNAL IMBALANCES

An effective system of managing the bank’s resource potential is one of the main conditions for stable functioning and ensuring competitive advantages in the market of banking services. The size and structure of the bank’s resource potential are influenced by factors of the market environment, which are manifested as economic, political, legal, social, technological opportunities and threats to the development of the bank. It is obvious that due to changes in the regulation of banking activity, changes in macro- and microeconomic dynamics, fluctuations in the money market situation, structural fluctuations in corporate and personal incomes, etc., the resource base for the formation of commercial banks is not stable. The paper examines and characterizes the economic essence and necessity of managing the resource potential of a commercial bank. The composition and structure of the resources of banking institutions by groups of state banks, banks of foreign banking groups and banks with private capital was analyzed, the effectiveness of resource portfolio management before the start of a full-scale Russian invasion and in war conditions was evaluated. The main methods of research were: the method of theoretical generalizations, the method of analysis, the tabular and graphical method, the method of comparison, abstract-logical methods. The theoretical and practical results of the research consist in developing recommendations for improving the efficiency of the commercial bank’s resource management in conditions of global imbalances, uncertainty and a full-scale Russian invasion of the territory of Ukraine. The issue of formation and effective management of the resource potential of banking institutions remains relevant, optimization of the structure and selection of the resource portfolio management strategy is especially in demand in the modern conditions of scarcity of bank resources. The stability and further growth of the investment activity of commercial banks depends on the growth and strengthening of the resource potential, and currently – the support of stable work during the war period.

ТЕНДЕНЦИИ РАЗВИТИЯ ДЕНЕЖНО-КРЕДИТНОЙ ПОЛИТИКИ В РОССИИ И ЗА РУБЕЖОМ

In the context of strategic deglobalization, when many countries are revising their economic priorities and reducing ties with the global economy, monetary policy is becoming an even more important tool for regulating the economy. The article examines the features of the development of monetary policy in Russia and abroad in the conditions of uncertainty associated with foreign economic events, technology development and digitalization. Thus, monetary policy may include measures to stabilize financial markets, such as: regulation of banking activities, including control over credit transactions and increasing capital requirements for banks. The paper examines the experience of various measures of European countries (the European Central Bank), the USA, Switzerland, China.

A Multijurisdictional Assessment of the Banking System and Mobile Money Services in Coping with the Pandemic-Triggered Credit Crisis

Although, unlike the 2008 financial crisis that erupted as a result of a corrupt banking system, the Covid-19 pandemic, which is a health crisis, arguably satisfied the regular features of a credit crisis. In its wake, the global economy and its structures were weakened, and made more vulnerable and exploitable. As governments around the world reacted by redirecting more resources in catering for the pandemic and its impacts, the possibility of a lax in regulation of banking activities as a result is high, and might motivate crooks to exploit the gap in financially defrauding citizens. Banks and all entities providing financial services (shadow banks) therefore require a more stringent regulation. Similarly, many governments (including Nigeria and other developing countries) are currently ascertaining ways to tackle the increased level of poverty owing to the pandemic, and towards this aim, have welcomed the proposition that financial technology companies can help achieve financial inclusion and thus reduce poverty. Towards achieving this goal, an effective mobile money services regime has been identified by the Nigerian Central Bank as a critical tool in revitalizing Nigeria’s battered economy. This article argues that the Nigerian regime of mobile money services is still ineffective and it ascertains this through a multijurisdictional assessment of mobile money services: the article makes suitable recommendations for a regulatory reform with lessons from Kenya and other countries.

Этапы эволюции государственного регулирования банковской системы в России с XVII – до начала XX века

The historical aspects of the development of the Russian system of state regulation of banking activities are considered. The subject of the study is the forms and mechanisms of such regulation in their historical dynamics. The state regulation of banking activities in Tsarist Russia went through a long period of formation from the establishment of simple rules and norms in the field of monetary relations in the 17th–18th centuries to the creation of a set of control actions that regulate the banking system, which was quite developed for its time, to the early 20th century. The study of the evolution of the banking system and its state regulation shows their close relationship with the dynamics of the country’s socio-economic development. Models of socio-economic de-velopment typical for a number of periods in the history of Russia are considered, we show the re-lationship between changes in these models in certain periods and the dynamics of the banking system, forms and tools of its state regulation. The main characteristics of the model of socio-economic development are considered, the development of these characteristics in separate periods is shown. A meaningful interpretation of the state regulation of banking activities in its dynamics from simple forms to a relatively developed complex is proposed, taking into account the evolution of the model of socio-economic development. The conclusion is made about the prevailing role of the state in the formation of the banking system, about its orientation towards solving the economic problems facing the country.

Problem moments of legal regulation of banking activity and ways of their solution

Problem setting. In the article the basic problems of legal regulation of the banking system of Ukraine in the context of Ukraine’s unification into the European Union. The author explore the concept of the banking system, considering the imperfections security mechanisms Banking in Ukraine justifies the need to improve banking legislation and consider international experience in banking regulation. Analysis of recent researches and publications. The general theoretical definitions of the essence of the concepts of the banking system and problems of legal regulation of banking were developed by domestic and foreign researchers, whose works formed the theoretical basis of this study, in particular: O.P. Orlyuk, M.V. Starnysky, M.I. Seleznyova, O.I. Lobozynska, O.A. Kostyuchenko, O.V. Ponedilko, K. Gavalda, J. Stufle and others. Target of research. It has been proved that the banking system in each country is an important chain in the financial system. The sphere of the regulation of financial and legal relations which are in the process of formation and functioning of the banking system establishments has been defined. Article’s main body. The legal regime of the arising and development of the institution of the central emission bank and the role of the central in the system of government bodies of power has been investigated. The legal status of the National Bank of Ukraine as a central body of state management with special authorities has been revealed. The legal status of the state banks of Ukraine have been researched. Conclusions and prospects for the development. The paper reveals the financial and legal foundations of banks in the process of crediting and payments as well as cash operations and the influence of the method of the financial and legal regulation as a prevailing method in terms of the relationship under the activity of state bodies while governing the organizations of the banking system and under the regulation by National Bank of Ukraine of the relations of commercial banks with their customers. Dozens of measures have been offered to improve the banking legislature of Ukraine as well as its matching with international standards.

К ВОПРОСУ О РЕГУЛИРОВАНИИ ИНВЕСТИЦИОННОГО БАНКИНГА В РОССИИ

Analytical documents of the Bank of Russia and financial statements of large Russian banks indicate the growth in incomes from operations with securities within the gross share of revenues of commercial banks. In the world, there are cases of excessive activity of commercial banks in the security market (the Great Depression of 1929–1933 in the USA, default on state treasury bills in Russia on the 17th August 1998), which led to negative consequences for bank clients. The author analyzed peculiarities of investment transactions conducted by commercial banks in Russia. The author gives recommendations to reduce financial risks for the commercial banks’ customers and promote the attractiveness of the investment banking products. The author’s concept of regulation of banking activity in Russia consists of two directions: regulation of classical banking (income from lending operations exceeds income from operations in the securities market) and regulation of investment banking (the predominance of investment operations). The author justifies the necessity of the introduction of mandatory insurance of funds invested in equity securities of Russian issuers admitted to circulation on the Moscow Stock Exchange in the event of bankruptcy of issuers. The paper critically evaluates the recommendation of the Bank of Russia that professional participants in the securities market should not offer complex investment products to unqualified investors as this restricts the application of derivative securities for hedging financial risks. The author suggests the requirements for the equity capital of professional participants of the securities market and the methodology for calculating the equity capital separately for classical and investment banks.

Directions and Legal Forms of Investment Activities of Banks

The paper is relevant because investment activities with the participation of banks, due to their special legal status, have a number of features of legal regulation that take into account the need to realize public interest in the activities of banks and their significant role in the economy. The basis for the emergence of discussions on the separation of investment and banking activities at the legislative level was the adoption of the American Glass-Steagall Act, containing the concepts of a segmented model of investment and classical lending. The paper analyzes the directions and legal forms of investment activity of banks in Russia, the difference between investment activity of banks and the classical understanding of banking activity. The main criterion for differentiation is the goal of investment and credit activity, the quality of risk, the mechanism for generating income. Investment activity, unlike credit, has a wider range of funding sources. The demarcation criterion is also the responsibility of the bank, which it bears when entering into relations with individuals in the framework of investment and banking activities. The features of the legislative regulation of banking activities in the securities market are identified, the role of banks in project financing and alternative (Islamic) financing is determined. It is proved that the investment activity of banks is a much narrower concept than the concept of a bank in the investment market, including the securities market.

Balance Between Risk And Profit In The Context Of Strategic Management: The Example Of Ukrainian Banks

The article explores the issues of strategic management of banks, the formation of long-term strategic goals, in particular – the construction of an effective financial strategy of the bank aimed at finding a balance between the need for risk minimization and profit maximization. Balanced risk and return management should protect economic entities from potential income shortfalls or a reduction in the market value of capital due to adverse effects of external or internal factors, from losses that can be both direct (loss of income or capital) and indirect (investment). the ability to achieve your business goals). The article presents the author’s own approach to the calculation of the taxonomic method of the bank’s integrated risk and profitability indicators, as well as the results of matrix analysis, which made it possible to trace the bank’s risk/profit ratio. All Ukrainian banks are selected as the subject of study, and the first three quarters of 2018 are the time horizon. Economic norms and limits of open currency position on regulation of banking activity by the National Bank of Ukraine were selected to assess the level of riskiness of the bank, and the main indicators of bank profitability (total level, cost recovery, return on assets, total capital, net interest margin) were selected for profitability level. The study empirically confirms that risk management in Ukrainian banks is at a critical level and profit management is at medium and low levels. Basically, banks are characterized by a focus on profit maximization, eliminating high-risk activity. The risk-reward strategy is chosen by a small number of Ukrainian banks and profit maximization is rare enough for Ukrainian banks. Keywords: strategy, bank, strategic management, risk management, profit management, taxonomic analysis, matrix analysis.

Regulation of banking activity at the international level

Regulation of banking activity at the international level

Адміністративно-правове регулювання банківської діяльності: постановка проблеми

Адміністративно-правове регулювання банківської діяльності: постановка проблеми

Actual problems of development of the banking sector in the economy of Kazakhstan

The article deals with topical issues to develop the banking sector in Kazakhstan as their condition assessment, weaknesses, strengths, problems and basic ways of development of Kazakhstan’s second-tier banks in the current environment, these issues are discussed in this article and determine the relevance of the material presented. The need to address the main problems in the development of the banking sector is due to the fact that it is represented as a fundamental element of the financial system. Moreover, under the modern conditions, it is subject to the impact of financial globalization, crisis phenomena in the world economy, the growth of uncertainty in the world financial market, which determines a number of negative consequences for the stable development of banking activities. Effective functioning of the banking system allows ensuring the sustainable economic development of any state, as the banking sector participates in the redistribution of funds and financing of the real sector of the country’s economy. At the present stage of the development, the issues of dealing with the key problems of the development of the banking sector acquire special relevance on a global scale, since the financial crisis has revealed the shortcomings of the current system of banking regulation and supervision. In this regard, in the crisis conditions, the state intervention in regulation of banking activities has intensified, the role of risk management in commercial banks has increased, the requirements to the bank’s capital, and the quality of assets has increased. Volatility and instability of the world financial markets require the search for new approaches in the implementation of banking activities to maintain sustainable development, increase margins in the banking business, which determines the relevance of this study. The main results of the research show the influence of external and internal factors that inhibit the development of banking activity.

Improving standard regulation of borrower’s credit solvency assessment

The research is devoted to identification of levels of standard regulation of borrower’s credit solvency assessment and development of the directions of their improvement at the national level. It is specified that the regulation of solvency assessment process is the set of standard levels and rules of organizing regulation of credit relations reflected in legislative, standard and legal and intra bank documents directed to a specific object, namely a solvency assessment. The article allocates three standard levels of regulation of solvency assessment of a borrower as a legal entity (international, national, and intra bank); the condition of their functioning is investigated and the directions of regulation improvement at national and intra bank levels are created. On the basis of the carried-out analysis of opportunities of introduction to the Basel recommendations about solvency assessment and credit risks in domestic banking practice, the author comes to the conclusion that economic conditions are not formed for their full realization in Ukraine. The realization of the assessment system of credit risks based on external ratings regulated at the supranational level at the present stage is possible for large system banks. The article specifies the structure and content of legal support of the allocated level of credit process national regulation presented by the Civil, Economic Code, the Law of Ukraine «About banks and banking activities» and Resolutions of the NBU. It is proved that the operating system of regulations according to borrower’s credit risks leads to essential increase in expenses of banks for reservation and to additional capitalization. The reasons of functioning imperfection at the national level of regulation are allocated: frequent changes and additions in acts concerning regulation of banking activities; discrepancy of separate standards of the legislation; incompleteness of conceptual framework in a number of acts; orientation of regulations to the demands set by a regulator without considering the specifics of domestic banking system. The author gives the requirements to improvement of the normative and legislative providing solvency assessment (harmonization of the legislation regulating banking activities and credit process with other acts of allied industries of the law, the accounting of domestic traditions of banking while implementation of international standards in the domestic legislation, formation of the separate law called «About Bank Credit»).

Analysis and evaluation of capital adequacy in Latvian banking system

Regulation of banking activity under economic insecurity conditions is one of key problems in our times and is acquiring a particular importance both for banks themselves and their shareholders and also for customers and depositors. Instability of economic situation gives birth to increasing risks faced by world banking system. And therefore in order to ensure reliable operation of commercial banks and prevent their vulnerability to economic insecurity, the supervisory bodies are continuously improving the methods of and approaches towards the management of bank risks accenting a paramount importance of own capital adequacy. A problem of how much capital Latvian commercial banks need to cover their risks remains one of most important in regulation and assessment of banking activity. Meanwhile, the principal direction to improve the capital adequacy ratio is the growth in its flexibility when determining the value of risks inherent to various bank organisations. In the present research authors carry out the analysis of risks inherent in activity of Latvian commercial banks, indentifies the risk pattern within own capital of banks, discovers factors having impact upon the risk pattern as well as estimates the amount of capital necessary to cover risks in various groups of commercial banks. Hypothesis – Stability of a banking system depends on the level of sufficiency of a bank capital. The aim of the research: Evaluation of capital adequacy of Latvian commercial banks and correspondence of capital adequacy calculations to Basel Committee on Banking Supervision rules based on analysis of financials statements, identification of capital adequacy problems and developing recommendations on improving bank capital adequacy according to the effective and the planned Basel Committee on Banking Supervision requirements.

Правовое регулирование банковской деятельности в Российской Федерации с учетом исторического опыта Западной Европы и США

Правовое регулирование банковской деятельности в Российской Федерации с учетом исторического опыта Западной Европы и США

Macroeconomic analysis of prudential instruments of bank risk management

The article analyzes instruments of prudentia1 regulation of banking activities, provides a comparative analysis of their effectiveness, and also suggests the use of the discussed instruments by bodies of monetary policy, depending on the institutional conditions. The influence of different modes of banking regulation on the accumulation of risks in the banking system is also analyzed.