Also, gradually increased the cost of supporting the banks' liquidity via refinancing operations (weighted average rate on all refinancing operations rose from 9.2% in 2007 to 15.3% for 10 months in 2008) were widely used interest rates on deposit operations, which ranged between 0.1 -10% depending on the time to raise funds and the situation in the monetary market. Such a policy has been directed? to increase the attractiveness of transactions in national currency and promote accumulation of activity of market participants, strengthening the role of the internal market in the resource base of banks and distraction on this basis public funds from the consumer market, reduce dependence on foreign borrowing of banks, reducing the risk of financial stability of the banking system, easing inflationary pressures in the country, etc. In October 2008, on the monetary market, there was tension on the liquidity of the banking system due to the global financial crisis and the effects of unfair competition - provoked artificially increased confidence to the financial condition of some banks. To stabilize the situation, National Bank of Ukraine has introduced additional measures concerning the activities of banks are reflected in the decision of the NBU Board of 11.10.2008, № 319. The main ones were aimed at empower banks to maintain liquidity through refinancing mechanisms, preventing the outflow of clients from the banking system, uninterrupted payments, temporarily limiting the deviations between the buying and selling rates of foreign currency cash, easing conditions for the formation of obligatory reserve requirements, limiting the demand of banking institutions for foreign currency, limiting the lending in foreign currency to borrowers who do not have sources of hard currency earnings, etc. Category: Liquidity of the banking system of Ukraine
Resources used in one period
We saw this in the case of payment of rent in advance. Some costs, such as general administrative expenses of the bank, are not directly related to income certain accounting period. Therefore, these expenses are recognized in the income statement for the period in which they occurred. Consequently, the use of the correspondence principle allows to distinguish between income and expenses between reporting (accounting) earnings periods and agree with the cost reporting period by which received that income. Accrual and compliance is essential to determine the probable financial results. The precautionary principle. Due diligence? Uncertainty of certain events. For example, the bank is always a chance that some loans will not be returned to the borrowers. Therefore, evaluating the information in the reports, you should avoid overstating assets and understating income or expenses and liabilities of the bank. This means that the costs and liabilities should be reflected in the financial account immediately after receiving information about the probability of their occurrence, and the assets and income - only if they are actually received or earned. So, for example, doubtful and bad loans to be deducted for expenses and calculate the total amount of loans granted in the period when there were doubts about the possibility of their return. Topic: The role of accounting in the management of the bank, its types and purpose | Tags: Resources
Setting CAP rate as the upper limit
Installation of ATS-rate as the upper limit or "ceiling" of raising the effective rate of borrowing, does not preclude benefit from reduced rates. If market rates are lower CAP rate, the loan interest paid on current market rates. Consequently, the percentage of CAP insures the owner of an increase in market rates, but you can take advantage of reduced rates. FLOOR - an agreement that entitles the buyer to receive compensation in the event of a decrease in market rates below pre-specified rate of interest based on a certain amount for a certain period in the future. FLOOR agreement designed to protect investors from the likely reduction of his income. Establishing the minimum bid for the assets of the investor in terms of floating rates to protect against lost revenue due to adverse movements in market interest rates, but also allows you to benefit from a general increase in rates. FLOOR agreement insures the buyer's interest rate risk, which assumes the option writer in exchange for an option premium. The closer the rate fixed in the agreement FLOOR, to current market rates, the higher the value of the option and the client will pay a big bonus when buying FLOOR, to protect their assets. In general, the mechanism of the agreement FLOOR is the same as the transaction CAP. The deal could be a real or notional payment of the difference in rates. If the conclusions of the option agreement is accompanied by the actual operation of investment funds, as well as in other derivative instruments, the investment agreement and the actual transaction FLOOR treated as separate independent operations. Interest on invested funds are awarded on a routine basis at market current rates. However according to the contract seller pays FLOOR difference in rates, if market rates were below the FLOOR, stated in the agreement. Category: Management Operations Commercial Bank | Tags: commission expenses
They differ in both tasks
Passive approach to portfolio management is based on the principle of "following in the footsteps of the market." The practical realization of this principle means that the restructuring of the securities portfolio must clearly reflect the trends in the securities market as the overall volume (based on the general market indices dynamics), and composition. In other words, the dynamics of the portfolio securities of the bank in a miniature copy to the dynamics of the securities market as a whole. The focus of the passive approach to portfolio management is being given to the restructuring of types of securities, and its profound diversification. Passive management policy includes: the formation of a passive portfolio, buying securities whose motion corresponds to motion of the entire market, the absence of significant turnover on the sale of securities in its portfolio, more long-term investment, a high level of portfolio diversification, a small fraction of individual securities is dispersed portfolio risk, minimum cost for analytical support, on payment of commissions to brokers. Before passive approach characterizes the formation of the conservative mentality of the portfolio. Category: Management Operations Commercial Bank
"Privat" - is a socially significant bank
Through the consistent policy of strengthening the stability of the bank and improve the quality of service, one of the priorities of its work, the development of modern services to individual clients. The bank offers the citizens of Ukraine for more than 150 types of advanced services, such as current, removable operations, card products, a variety of consumer lending program, in partnership with the leading national brand, rielterskimy companies and automakers. PrivatBank is authorized by the Government of Ukraine the bank for payment of pensions and social assistance to citizens, as well as compensation to victims of Nazi persecution. Today, his pension and social payments in Privatbank receive more than 1 million people. Privat - bank on a national scale. National banking service network includes 1528 branches and outlets throughout Ukraine, allows any customer to receive the highest level of service almost anywhere in the country. A wide range of foreign partners, "Privat" not only demonstrates its recognition as a full participant in the global banking system, but also, more importantly, allows the most common needs of bank clients related to their international activities, maintains correspondent relationships with major foreign banks, effectively working with them at different market segments. Privat Bank is an authorized servicing credit lines of the World Bank for Reconstruction and Development (IBRD), European Bank for Reconstruction and Development (EBRD) and the Ukrainian-German Foundation, aimed at developing small and medium businesses. Category: Uchot bank ucherizhdeny | Tags: Privat
The claims of the bank
3. Surety - a contract with unilateral obligations on which the guarantor undertakes to pay the creditor bank if necessary debt the borrower. The interim bail function is manifested in the fact that the lender in case of default by the debtor is entitled to raise his claim as to the debtor and the surety. In the event of default by the debtor and the surety liable to the lender as joint and several debtors, unless otherwise stipulated by the contract of suretyship. Category: Management Operations Commercial Bank
First of all, we must consider the structural units of accounts
Chart of Accounts consists of classes, divisions, groups, and proper accounts. These structural units of different levels of detail on the elements of accountability. At the class level is not provided substantive information. The structural unit of "class" has a different load. Allocation of classes allows you to combine in a single homogeneous class by type of assets and liabilities according to economic substance of operations performed by the bank. All the minimum necessary information is available at the level of these units, as sections, they are also called second-order accounts. More information is available for groups - an account of the third order. Deepening of detail achieved in the accounts of the fourth order. Each class includes accounts II, III and IV of the order. They all belong to the synthetic accounts and different levels of detail information about the object records. The Plan accounts accounts are placed in ascending order of their numbers. Note how the numbering based accounts. Understanding the approach used in the numbering of invoices, you can quickly and easily locate information about certain types of assets, liabilities, equity, revenues and expenses in the financial statements. The classes are numbered from 1 to 9 and consist of the same sign. Numbering Accounts II, III and IV of the order by adding the same sign (from 0 to 9) to the right in accordance with the number of class II and III accounts-order-to-one classes (classes) of numbers, counting the II (section) - two-digit numbers ; account of the III (group) - three-digit numbers, counting the order of IV - four-digit number. Topic: The role of accounting in the management of the bank, its types and purpose | Tags: Chart of Accounts
According to the direction of interest rate policy
The average cost of credits in national currency in February, up from 26.5% to 27.9% in foreign currency - from 10.4% to 10.7%. Integral rate on credits increased from 21.9% to 23.2%. Weighted average cost of deposits in national currency in February, up from 15.9% to 16.4%, foreign - has remained unchanged - 8.6%. Integral rate on deposits increased from 12.7% to 13.3%. The volume of required reserves generated by banks in February 2009 amounted to 12.5 billion UAH. In order to facilitate banks to terms of raising funds in foreign markets in the face of declining liquidity and the need to fulfill external obligations National Bank on 1 February 2009 reduced standard of redundancy within our means, who are attracted by banks from non-resident banks and financial institutions, non-residents by setting it equal to 2% . Previously, these funds subject to the same standards for the formation of obligatory reserves by means of legal persons of the relevant currency and maturity. In February 2009, the Ministry of Finance of Ukraine carried out the placement of T-bills (hereinafter - the T-bills), so that the State Budget of Ukraine has received funds in the amount of 1403.89 mln. The weighted average yield on government bonds during the initial public offering in February 2009 was 15.6% (in January - 9.9%). Redemption and payment of income on government bonds in a timely manner and in full, which from the beginning of 2009 amounted to UAH 865.04 million, including Principal - UAH 616.32 million, the payment of income - 248.73 mln. The National Bank is committed to active and productive cooperation with all branches of government - the President of Ukraine, Government, Parliament. Both management and specialists of the National Bank regularly take part in meetings, round tables, conferences related to its competence. Weekly National Bank provides online information about the state of the monetary market and the President of Ukraine Cabinet of Ministers of Ukraine. However, a wide range of operational information is posted daily on the official website of the National Bank of Ukraine on the Internet. Specialists of the National Bank and State Treasury on a daily basis in the operating mode provide consultations on current and forecast the dynamics of a single treasury account. Topic: Banking systems | Tags: organization of the banking system
To achieve this goal
- Investigated the role of controlling, as an economic category - reasonably banking problems of managerial accounting - considered controlling and management accounting - set out the technical and economic characteristics of Privat - researched analysis of the characteristics of the organization and management accounting Privatbank - considered balanced scorecard bank controlling - are the conceptual foundations of the organization controlling the bank - suggest ways of improving and controlling the administrative account at the bank today. The above subject has received considerable attention of the National Bank of Ukraine and the Cabinet of Ministers, which was reflected in the laws "On Banks and Banking Activity" "On the National Bank" and the instruction "On the application of the Plan of Accounts for tanks Ukraine", approved by the Board of the National Bank Ukraine from 17.06.2004, № 280. The principal problem of controlling business entities have been reflected in the writings of German scholars D. Han, X. Folmuga, A. Dayls, E. Maier, R. Mann, C. Homburg, H. Pietsch, E. Sherman, Russian scholars-C. Danilochkinoi, A. Karminsky, N. Olensva, A. Primak, C. Falco, F. Pischanova, Popova, E. Utkin, VI, etc. Certain Marinyuka research were conducted controlling local specialists - M. Pushkar, L. Kindratskogo, Petrenko, A. Sukharev and others. The above facts indicate the need for the topic in modern conditions of development of Ukraine, and demonstrate the promise of controlling the use and management accounting in the bank for managerial decision making. Implementation of the proposals and recommendations given in the paper, will allow more effective management of banking activities. This will give the opportunity to hold banking institutions in accordance with an integrated control system controlling and management accounting at the bank. Topic: Banking systems | Tags: banking system, the goals
Liquidity of the banking system of Ukraine
The liquidity of the banking system is its dynamic state, which ensures timeliness, completeness and continuity of the total liabilities of the banking system and there are sufficient funds to meet the needs of economic development. Given the role played by the liquidity of the banking system to ensure its solvency and financial stability, advanced development and efficiency of the transmission mechanism of monetary policy, it represents an important control of the central bank. Management of liquidity of the banking system - a complex process of creating preconditions to ensure and maintain the optimal level of liquidity at the macro level. Optimal, in our opinion, there is a level of liquidity, which makes it possible to carry out their banking system liabilities, as well as increase the volume of banks' operations in accordance with the needs and the cycle of economic growth without creating imbalances, threats to financial stability and the development of inflationary processes in the country. In Ukraine, the liquidity of the banking system by the National Bank of Ukraine in the regulation of the monetary market through certain legal mechanisms and instruments. At the present stage of development of monetary policy in accordance with the current regulatory framework for liquidity management and the National Bank of Ukraine may use tools of bank supervision, as economic standards - particularly liquidity (immediate, current, short-term) and capital adequacy, as well as the following instruments of monetary policy: reserve requirements, interest rate policy, bank refinancing operations (overnight credits, loans of up to 14 days and 365 days), the operations of direct and reverse repurchase transactions of foreign exchange at the national (swap), a stabilization loan, operations with its own debt obligations (certificates of deposit overnight, up to 14 days to 365 days), transactions with state bonds of Ukraine, long-term loans secured by property rights to the funds a bank deposit. Regulation of liquidity in the banking system and is preceded by an analysis of factors conditioning it. The liquidity of the banking system is influenced by factors of demand for it and many external (standalone) and internal (non-autonomous) factors in its proposal. Category: Liquidity of the banking system of Ukraine | Tags: banking system liquidity
In Ukraine, a gradual transition
For the growth of tension in financial markets in autumn 2008, was an increase in demand for foreign currency, which caused significant devaluation pressure on the hryvnia. In the aspect of liquidity management increased flexibility of the course in autumn 2008 reduced the role of the exchange channel in the structure of the issuance of payment instruments (in the structure of the pure "non-cash issue" operations in the foreign exchange market amounted to 94.3% in 2007, and after 10 months of 2008 - 27.3% ), reverse the effect of foreign exchange intervention on the liquidity of the banking system of Ukraine and increase the chances of central bank in managing the monetary market through the regulation of interest rates under a regime which is based on price stability, become the main instrument of monetary policy. In addition, the growth of exchange rate flexibility, the hryvnia against the U.S. dollar for economic actors is a sign of refusal of the National Bank of the policy making of currency risk to themselves to maintain exchange rate stability, which increases the uncertainty for economic agents regarding the future profitability of capital in foreign currency, which may decrease with risk-adjusted market exchange rate. Due to decrease in speculative foreign capital coming to Ukraine, active development of the domestic monetary market and market-based hedging of currency risk, reduced the level of financial dollarization in the country, etc. Another important factor influencing self-liquidity of the banking system is "Net liabilities of government", which are accumulated through a network of daily flows of funds, passing on the consolidated financial account, which suffers from significant fluctuations in seasonal income and expenditure budget. In view of the impact on liquidity of the banking system of Ukraine is the most problematic factor in the movement of funds in the account of the government (Treasury Single Account) at the National Bank of Ukraine. Category: Liquidity of the banking system of Ukraine
Consequently, management accounting in a commercial bank
The main difference is that financial accounting is designed primarily for external users of information (shareholders, investors, creditors, supervisors, etc.), although widely used, and the heads of the bank (internal users) and management accounting is confidential (private) information that takes into account the technological and organizational features of a particular bank, as well as requirements management and use them for making management decisions. Each bank to decide the issue, it is advisable to introduce him to Managerial Accounting. The state encourages enterprises to conduct legal only financial accounting and publish financial (external) reporting and thus creates the conditions and the source from which citizens and other participants of the market economy can get financial information about the activities of individual companies, including banks, and have reason to decisions on investing. Without reliable information about market participants can not be achieved optimization of market processes and the efficient functioning of the economy. Thus, a significant social role of financial accounting is to provide users with information through the provision of financial statements. However, the usefulness of the information depends on understanding the content of messages he who receives the information. The transfer of information is important to unambiguous interpretation and understanding of concepts, terms, rates and other media used in the decision-making managers, investors, creditors and other market participants. This problem is solved through the commitment of all enterprises to financial accounting and prepare financial statements under the rules set by the state. National regulations on accounting and financial reporting, adopted in Ukraine can be considered as a kind of constitution of financial accounting, the rules which are binding on companies, which are financial accounting. The purpose of this book - to help future managers in banking technology to master the birth of financial performance reporting and understand the multiple logical relationships between forms of financial reporting and key performance indicators. Topic: The role of accounting in the management of the bank, its types and purpose | Tags: Management Accounting
In "Privatbank" information system is used
The "Privatbank" Private Information System is used for 48 through which the customer service, and all the banking operations. Review and analysis of the above issues led to the need to find ways to improve the process under investigation. Analyzed the existing proposals on this issue and classified in the following areas. To realize a support system for controlling bank management, focused on strategic management of the activities necessary to determine its organizational framework. Create pidrozdilv controlling will ensure transparency in economic management by the bank, have an integrated database that serves as the basis of adequate dlyaprinyattya management decisions at all levels of management, to carry out a comprehensive approach to strategic and operational management of the bank, improve internal controls over the achievement of strategic and tactical goals of the bank. If you had focused on training and support for mandatory reporting of certain business processes, but now the emphasis begins to shift towards the effective management of the bank as a whole. All the more urgent problem of improving the quality of management to the appropriate level of profitability and sustainability of the bank. This tasks are allocated in the bank, which provides management accounting. Controlling the risks of the bank and the expectation of profit in case of risk management is evaluated in order to minimize costs, and this would allow the improvement of the bank as a whole .. Thesis has some practical value. Mouse key performance indicators and tools controlling and improving the management accounting can be used in banks. Category: TECHNICAL ISSUES OF LABOR
Other key provisions of principle
The correspondence principle allows the calculation of the financial results of the reporting period by comparing the income of the reporting period with expenses that are incurred to produce that income. The pivotal position of the correspondence principle is that the revenues and expenditures must be properly evaluated in each account (reporting) period. Revenues for the reporting period is determined on an accrual basis, and then costs should be linked to earned income. The difficulties of applying this provision lies in the fact that in practice business operation begins in one reporting period, and ends in another. In the example of a loan, we saw it. The correspondence principle determines the order of cost estimates based on the purpose for which the expenses occurred. If the costs associated with a particular income, they are recognized in the period in which the income was earned. By studying the report on financial results, we have seen that the interest expense associated with banking operations to attract deposits, are displayed together with the interest income earned from lending operations, and is calculated by comparing interim financial results in the form of net interest income. Topic: The role of accounting in the management of the bank, its types and destination
Free liquidity
NBU and the volume formed by banks compulsory reserve requirements. Source: Calculated according to the National Bank of Ukraine [1, 6, 7]. The level of liquidity in the banking system and suggests indicators such as the ratio of liquidity in the monetary base [17]. In Ukraine, during 2007, this indicator fluctuated between 9.0-13.3% (see Chart 2). In 2008, the liquidity situation of the banking system in Ukraine has deteriorated: the figure fell from 7.1% at the beginning of the year to 3.3% in early June. Since June, the free liquidity of banks tends to rise and the beginning of October 2008 was 6.6%. For comparison, the level of free reserves of banks in developed countries is supported by the central banks steady at 1% of the monetary base. This helps to minimize the volatility of short-term rates in the market and hold them at a level adequate to the target of price stability. In the new market economies, the rate is 3-5%, and its decline in Ukraine to 1.25% at the beginning of October 2008 reflected the problem of liquidity of the banking system due to a number of internal and external macro-and micro-economic. Category: Liquidity of the banking system of Ukraine
Development Fund of the Bank
Foundation of the bank is typically used to support the activities of the bank, its further development and acquisition of capital assets. The bank's charter may provide for the establishment and other funds necessary for the bank. 2. Profit consumption distributed profit) Payment of dividends; material incentives and social welfare workers of the bank. With the earned income for the year form the foundation of banks paying dividends. Fund dividend payments used to accumulate the funds needed for the planned payments to shareholders (founders), and the entire period of time prior to the approval of such payments by the general meeting of shareholders (founders) in the possession of the bank. The policy objective of profit distribution - the optimization of the proportions between the parts arrived, and the consumption share of the profits are capitalized. Proceeding from this basic goal in policy of profit distribution of the bank solves the following main objectives: to ensure owners receive the required rate of return on invested capital, providing strategic development priorities of the bank at the expense of profits, capitalized, providing stimulating labor activity and additional social protection staff, ensuring the formation of the necessary amount of funds and bank reserves. Specificity of the challenges facing each individual bank in the process of its development, the difference between external and internal conditions of their activities do not allow to develop a unified model of the distribution of profits that would have a universal character. So the basis of profit-sharing mechanism is a specific bank account in the analysis and the process of distribution of the individual factors associated with this process is ongoing and the following activities of the bank. Topic: Fundamentals of Financial Management Bank | Tags: Profit Development Foundation
Disclosure of information
The purpose of this standard is to establish requirements for the format, scope and content of financial information that banks are obliged to provide external users. Under this standard, comments of banks to the financial statements should disclose such aspects as the management and control of the bank's liquidity and inherent in banking credit, interest rate and currency risks, etc. Use of this standard allowed closer to the financial statements of banks reporting standards that apply in countries with developed market economies, and make the banking system more transparent. But there are still differences in approach and the NBU to financial reporting of banks in relation to the requirements set out in international standards of accounting. These differences can be seen by comparing the contents of the NBU regulations to IFRS (IAS-30. therefore remains urgent problem of development of national accounting, similar to IAS-30. A positive solution to this problem would be to promote transparency in Ukraine's banking system and enhancing its integration into the global financial the system. The authority of the bank's management with respect to financial accounting covers the creation of appropriate conditions for the proper conduct of financial accounting in accordance with applicable law. To meet this requirement, the bank's management must ensure the development of internal regulatory legal act, which is called the "bank's accounting policy." This document sets out the rules of the organization and financial accounting methods for assessing specific sites of financial accounting, which allowed the use of alternative methods, as well as: accounting procedures used by the bank for the preparation and submission of financial statements. This document contains the first accounting policies of the bank on the formation of reserves to cover losses from bad loans, impairment of securities and other doubtful assets, the rules of write-offs of bad loans to repay, accrual of interest income and expenses, the organization of internal control in the implementation of accounting procedures, etc. Topic: The Role of Accounting in the management of the bank, its types and purpose | Tags: Disclosure
Real estate and rights to them
Register before the enactment of the Act, are registered appropriately. Real estate and rights to them, which occurred before the entry into force of the law, but have not been registered, subject to registration in accordance with the requirements of the Act. State registration of real property and rights to them precedes the mandatory testing of these objects, as well as checking the availability of materials inventory prepared by the authority of technical inventory, which conducts state registration. The subjects are the owners of the state registration of real estate (physical and legal persons), the owner of the rights to it (users, owners of easements, etc.), on the one hand and the authorities engaged in sho state registration of rights to immovable property - with another. The state registration of real estate owned by the state, is carried out by state enterprises, institutions and organizations, on the balance of which there are such objects, and which the right of full economic management over them. The state registration of real estate owned by the state and the right of operational management delegated to public enterprises, organizations and State-owned enterprises is carried out by these companies and organizations. Limited property rights are recorded at their owners. Legal attributes of the property to create the real estate market should legalize property that is in accordance with the approved forms for each property must be assigned an identification (inventory) number - a compressed digital expression of a set of characteristics of the property, which eliminates confusion (identification) of the property to another. This is a unique digital name of a particular property. The law defines an identification (Cadastral) designation - a coded number assigned to each property in the state registration of rights and which can not be repeated in Ukraine. Category: Klasifikatsiya real estate market
All of the above problems are closely profit management
Although some of them and have multidirectional nature (for example, to maximize profit while minimizing the level of risk, ensuring an adequate level to meet the interests of the founders of the bank and its staff, ensuring a sufficient amount of profit allocated to accumulation and consumption, etc.). Therefore, in the management of individual profit targets should be optimized together. An effective mechanism for managing the bank's profit can fully realize the goals and objectives, the challenges it contributes to efficient discharge of management functions. As each control system, control profit and sells its main purpose and main problem by performing certain functions. Structure of the basic functions of management profit shown in the figure shows only the basic functions of profit management specific to banks of all forms of ownership and legal forms of activity. Office of profit banking institution - is multifaceted and very complex process, requiring Bank of careful consideration of this issue as a strategic and tactical aspects, and in the annual budget plans. In general, the process is shown in profit management Building management system requires the formation of systematic profit list of objects of control. Such arrangements are to control objects on the one hand, should reflect functional orientation of the office and on the other - its different levels. Category: Fundamentals of Financial Management Bank | Tags: profit management
The influence of external risks
B) domestic or purely banking risks, it is - the risks that are directly related to the functioning of the bank as a commercial entity. The wider range of customers, partners, relationships, bank, banking, services, the more internal risk accompanies his work. Internal versus external risk identification and more amenable to quantification (quantification of quality attributes). Risk classification is made depending on which is the basis of the classification criterion, but the complexity of the phenomenon of risk, creates opportunities for different approaches to address this issue, although unlikely to be able to cover it completely. To external and internal banking risks are divided in terms of areas of occurrence and control capabilities imi.V range of foreign markets also include political, legal, social and general economic risks involved in the case of aggravation of the economic crisis in the country, political instability, war, the ban on payments abroad, consolidate debts, the embargo, the abolition of import licensing, natural disasters (fires, floods, earthquakes), privatization, nationalization, inadequate regulation and others Category: Risk in the Banking
Necessary to determine the expenditure
These expenses fall under the first reduction since it is not critical for the bank and the main. According to the current banking practices in the expenditure to be optimized include: the cost of capital and current repairs of fixed assets, the cost of information and consulting services, hospitality costs, costs for their own protection the bank, the cost of travel, costs for advertising, content and rental car service, the cost of acquisition and production of operational and blank material, office expenses, labor costs. For each group of costs, optimize, set its order of approval. For the cost of labor standards should be developed, which include: the load on a single operation-cash employee, the amount of foreign exchange transactions per day, number of transactions on deposits of population per day, receiving payments from the public on the day, the number of personal accounts. Depending on the rate burden per employee adjusted number of employees of departments, offices, branch offices: in case of insufficient load is analyzed the possibility of reducing the number of employees, and in case of high load activities are designed to streamline the activities of employees. Topic: Fundamentals of Financial Management Bank | Tags: expense items
Pravex is one of the leaders
Pravex occupies a leading position in the banking market of Ukraine on lending to individuals. Loans to individuals are 88.5% of loans in total loan portfolio. According to the Association of Ukrainian Banks on 01.01.08g. regarding the fate of individual loans in the loan portfolio of individuals and entities Pravex-Bank ranks fourth among the top banks in Ukraine. The volume of lending to individuals in 2007 increased compared to 2005, 1.88 times, or in absolute terms at 1003.33 mln. and made as of 01.01.2008 USD 2.14661 billion (Figure 3.6). This volume is formed by providing a broad range of programs for individuals (Figure 3.7), namely, a standard loan secured by real estate, land, property rights to the deposit, vehicles, mortgages for home purchase up to 25 years, youth loan to buy a home for a period up to 25 years credit for buying cars on credit for up to 7 years of consumer lending for purchase of household audio and video up to 3 years, and lending to other services, pawn lending. Pravex provides lending services to corporate clients and it is constantly developing new lending programs. In total there are 10 bank loan programs for businesses, such as: loans and credit lines secured, short-term lines of credit in the form of an overdraft, long-term credit for investment in real estate (offices, rooms); credit for the purchase of vehicles (including car park ; lending for the purchase of equipment financing for the purchase of agricultural equipment, bank guarantees, loans by discounting bills, loans from the use of documentary letters of credit, lending in foreign trade. Category: Financial Management | Tags: Pravex
U.S. banking system
It can not be revoked at the whim of the president, Congress also can not change its role and functions only as a special legislative act. Long terms of office of members of the Board provide an opportunity to protect and insulate them from political pressure. Another important feature of the U.S. banking system - are twelve Federal Reserve Banks (see Figure 5). These banks are: "central bank"; kvaziobschestvennymi banks, banks, banks. Thus, in the U.S. - 12 "central banks". This reflects the geographical extent, economic diversity and the large number of commercial banks in the country. After the central bank main directives of the Council of the Federal Reserve. The most important of them - the Federal Reserve Bank of New York City. 12 Federal Reserve Banks have kvaziobschestvennymi. They reflect the symbiosis of private ownership and public control. Their owners - commercial banks of the respective district. For admission to the Federal Reserve, commercial banks are obliged to purchase shares in the share capital of the Federal Reserve Bank in their area. The policy pursued by the Federal Reserve Banks, established public body - the Board of Governors Federal Reserve System. The central banks of the American capitalist economy are privately owned but managed by the state. They are not guided by the desire for profits, as a policy, which in terms of Boards of Governors of the Federal Reserve enhances the state of the economy as a whole. Federal Reserve Banks to depository institutions doing the same thing, that depository institutions are doing to people. They take deposits from banks and savings institutions and provide them with loans. Thus, the Federal Reserve Banks are "bank of banks". Topic: Banking systems | Tags: characteristics of the banking system
The essence of planning
The essence of planning is the choice of many alternatives to certain specific development goals and objectives. Organization of work - an activity aimed at implementation of the decision, during which the accounting and reporting through continuous oversight by the actual state of the control object and a comparison with routine tasks. In case of deviations is necessary to regulate the process by adjusting the organization of work or changes in plans adopted. Consequently, the organization of management accounting bank significantly affects the effectiveness of management in general. Both at the planning stage, the definition of common purpose and specific objectives of development and in the process of comparing actual and planned development indicators. It should be noted that to effectively regulate the economic process on the basis of management accounting can be used only if the relevant information is provided in a timely manner. Therefore, the first and defining feature of management accounting is necessary for efficiency analysis. The second feature is that it is systemic. It is important that detailed records of business transactions carried out not only for the bank as a whole, but for its divisions, business areas, for individual financial instruments. Category: Uchot bank ucherizhdeny
Activity in the financial markets
The risks assumed by banks, carrying out operations with financial instruments, including liquidity risk, credit risk, foreign exchange and interest rate risk, etc. Increased competition in the banking market leads to increased risks that accompany the activities of banks. In a society with a market economy there is an urgent need to maintain the reliability of banks, their solvency and liquidity, to limit the risk inherent in various activities of the bank. Bankruptcy of banks, financial crises are very painful impact on the state of the economy and society. After all, most individuals and businesses use the services of the bank or the depositors, or borrowers. The contributors are primarily interested in preserving the bank invested in cash and in getting them a decent income. Bank customers in the event they need to borrow must have confidence in the bank's ability to provide such loans. The success of the bank depends on the level of credibility among potential investors and borrowers. The correctness of their decision-making at the option of the bank's own investments and trends requires high quality information about economic and financial activities of the bank, as well as disclosure of the extent of existing and future risks that have faced or may face bank soon. Topic: The role of accounting in the management of the bank, its types and destination
Letters of credit collection
A letter of credit from Pravex is the most acceptable form of payment in international trade because it provides clear obligations partner. The use of credit form of payment significantly minimizes transportation and commercial risks of the business. For importers of credit is more advantageous than the down payment, for exporters - is more favorable than bank transfer. Pravex-Bank offers a full range of credit form of payment, including consultation with experts on the effectiveness of a letter of credit and currency legislation. Together with letters of credit from Pravex you can without too much hassle to create your own business, acquire additional economic benefits in the business environment, more than just receive a loan for business development, to provide "status quo" a reliable payer or provider, and easily establish new effective foreign contacts . Category: Financial Management
None of the financial instruments
Therefore inevitable compromise. If the security is reliable, then the yield will be low, since those who prefer reliability, will offer a higher price and reduce profitability. The main goal of portfolio management is to implement the basic policies of the financial investment of the bank by choosing the most profitable and safe financial instruments. In other words, an appropriate set of instruments designed to reduce the risk of the depositor to a minimum and at the same time to increase his income to the maximum. Given the stated primary objective to build a system of specific local objectives of portfolio management, the main ones are: to provide high-level form of investment income in the current period and high growth rates of capital invested in the future long term support to minimize the level of investment risk associated with financial investments, To ensure the necessary liquidity portfolio, compliance with regulatory requirements of regulatory authorities (NBU), to maximize the effect of "tax shield" in the process of financial investment. Indicates the specific purpose of managing a portfolio of securities to a large extent are alternative. Thus, to ensure high growth rates of capital invested in the long run, to some extent achieved by significantly reducing the formation of investment income in the current period, and vice versa. Growth rates of capital invested and the level of formation of the current investment return is directly related to the level of investment risk. Providing necessary liquidity portfolio may prevent the inclusion of both high-and low-risk financial investment instruments. Category: Management Operations Commercial Bank
The probability of receiving advance
The gap is largely determined by the legislative regulation of the country and the conditions of financial contracts. The vast majority of transactions in which payments are made, provides an opportunity for early payment and the amount and types of penalties (fines, penalties, etc.) for failure to implement transfer of currency. In the latter case, the delay in payment associated with a decrease of the course, will be justified only if the decrease in the cost of currency at the new rate will override the amount of assessed penalties. It should be noted that the management of foreign exchange positions by means of balance sheet operations often do not correspond to their own needs and plans of the bank, and sometimes a disadvantage in terms of costs. However, domestic banks are forced to resort to such methods in the absence of the necessary conditions for the use of more modern and advanced methods of management of foreign exchange positions, such as, in particular, as a forward exchange transaction. The method of hedging, or synthetic control, provides for protection against foreign exchange risks of additional imprisonment term foreign exchange transactions, which can compensate for certain financial losses on balance sheet items by currency fluctuations. Advantages of synthetic control: flexibility, there are possibilities for rapid maneuver without changes in bank balance, the ability to respond rapidly to variations in the ratio of assets and liabilities in foreign currencies. Therefore, a necessary condition for the effectiveness of this method is the existence of a liquid futures market, which would make it possible to perform operations with derivative instruments at any time and in any quantity. Category: Management Operations Commercial Bank | Tags: Probability
Nature and significance of the bank's liquidity
In the interpretation of certain features can be traced, which express the essence of liquidity in general and in particular liquidity. First, each of them has a direct or indirect mention of monetary relations, therefore, the concept of liquidity is directly related to the category of money. Second, in most definitions found indications of timing, ie, liquidity one way or another connected with the time. Also, liquidity is related, firstly, with the ability of handling guns in its core functions, and secondly, with enough money and, thirdly, the reliability performance of debt in society. For the bank money and the working capital and to some extent the product. If manufacturing companies base their work on the circulation of capital mainly in the form of commodities and their liquidity depends on the liquidity of the goods, the bank, carrying circuit of capital in the form of money as an active participant in the money market, deals primarily with debt (of both creditors and debtors .) Category: Management Operations Commercial Bank
Treasury instruments to carry
Cash, precious metals, securities which are refunded by the National Bank of Ukraine, funds of commercial banks in the National Bank of Ukraine National Bank of Ukraine means a commercial bank. By the interbank instruments include transactions between commercial banks: correspondent accounts, deposits, loans, financial leasing. Cash, standing in the first place - is the most liquid assets. Cash means all funds in the national and foreign currencies, as well as travelers checks, regardless of where they are. Cash and traveler's checks are recorded on different accounts. Other most liquid assets are two types of accounts that do not give a percentage of income: the balances on correspondent accounts with the NBU and balances on correspondent accounts with other banks. For the purpose of settlement banks have to keep the funds in each of these assets. In the sections "means the National Bank of Ukraine" and "Resources of the National Bank of Ukraine" displays the active and passive transactions of a commercial bank with the NBU. National Bank of Ukraine in relations with commercial banks using financial instruments such as pawn loans, repurchase transactions, direct lending, loans and other auction choice of financial instruments depends on the nature of monetary policy. For sufficiently liquid assets include domestic government loan bonds, overnight deposits and short-term deposits in other banks, loans and short-term overnight loans to other banks. Performing with the bank (monetary) metals by commercial banks is possible only if the existence of a license. Precious metals are also seen as highly liquid assets. In the "Bank metals" are taken into account only those metals that are defined by legislative acts. This section shall not be considered precious metals, are stored in the bank on behalf of its clients (their record is out of balance), and securities that are not included in the list of securities which the NBU refinanced (their records are maintained in the third and fourth grade) . A list of the securities and procedure for refunding is determined by the National Bank of Ukraine. By the arrears owned deposits and loans, the period for which payment overdue, but the risk of default on them are not so high as to relate them to the bad debt. Questionable are those deposits and loans, which are unlikely to return. Topic: The role of accounting in the management of the bank, its types and destination
The money multiplier is not calculated
The money multiplier is not calculated for M0, since this unit is completely included in the monetary base and therefore not multiplikuetsya. The money multiplier shows the connection between the money supply to the monetary base, as will change the money supply when the monetary base. With a combined issue of money in the first place increases the monetary base (issue of central banks), and then - the money supply (issuance of commercial banks), in an amount corresponding to the multiplier. It is believed that the money multiplier effect on required reserves of the bank deposits at the central bank and its maximum is theoretically determined by the inverse of the average rate of mandatory reserves, which is approved by the central bank. In this case the multiplier determines the upper limit of animation - the maximum ability of the banking system to expand its money (credits) in economics at the current rate of redundancy. If the banking system does not exist, then rotate only cash. Then the multiplier effect is absent, and the multiplier is 1, which is a lower limit value of the money multiplier. The maximum value of the money multiplier as the inverse of the average rate redundancy is often used for control and comparison with the actual value of the multiplier as the ratio of mean values (for the relevant period) of the money supply in the monetary base, which allows to determine the intrinsic nature of the multiplier effect and the factors of change . Topic: The mechanism of emission
The most successful and complete
How to implement banking supervision is allocated nine categories of risk, namely credit risk, liquidity risk, interest rate risk, market risk, currency risk, operational and technological risk, reputation risk, legal risk and strategic risk. These categories are not mutually exclusive; any product or service may expose the bank to several risks. Credit risk - this is an existing or potential risk to earnings and capital, which arises from the inability of the party who has undertaken to fulfill the terms of any financial agreement with the bank (his unit), or otherwise perform its obligations' liabilities. Credit risk exists in all activities where the outcome depends on the counterparty, the issuer or borrower. It occurs every time the bank provides funds, accepts the obligation to provide them, invest or otherwise runs the risk of them under the terms of the actual or prospective transaction, regardless of where the transaction is reflected - in the balance sheet or off balance sheet. Topic: Risks in Banking | Tags: Credit risk
JSCB "Pravex-Bank" - Bank nationwide
Pravex is a multifunction financial institution that provides a full range of banking services to both retail and corporate customers. Pravex his way of public recognition, and at this stage should be proud of their achievements. JSCB "Pravex" is registered in the National Bank of Ukraine December 29, 1992. Bank in parallel with the organization of customer service in April 1993, opens its first branch in the Kiev region. In July 1996, received a license from National Bank of Ukraine to engage in all banking operations. Today, Pravex is a structure consisting of a main bank, which organizes and supervises the work of branches, offices and branches throughout Ukraine. In turn, the main pot consists of departments, each of which operates in a certain direction in order to organize the most effective work with clients. Working in the Ukrainian banking market over 15 years, Pravex from year to year becomes more accessible and closer to their potential customers and partners. This is defined as a level of high standards of service, and the geography of place. This is achieved through the creation of the widest network of branches and outlets throughout Ukraine, which provides maximum proximity of banking services to each client. The structure of the bank has more than 520 offices and branches and about 2257 points of the issuance of consumer loans, located in the Kiev region, and in all regions of Ukraine, including Crimea. Category: Financial Management
The validity of this event shows
Where is widely used mechanism for mandatory reserve requirements, standards which tend to decrease. Another possible direction of using the mechanism of reserve requirements is to free the banks from obligatory reserve funds attracted in national currency, which are aimed at long-term lending to investment and innovation projects of national economic actors, the development of domestic production, creating an internal supply, as well as energy saving and import substitution. This practice of selective and non-market policy measure, but its provisional application may be appropriate in the acute need to address importozalezhosti caused by the lack of domestic supply, adequate growing demand of the population, as well as large energy consumption of domestic production and the influence of these factors on the deterioration of the balance of payments, inflation and exchange rate dynamics in the country. In our opinion, this measure in terms of direct limits on the increase in lending in foreign currency counterparts, who have no sources of foreign exchange earnings, to promote positive change in the loan portfolios of banks, which means - an increase in long-term investment in the real economy, reduce inflation and liquidity risk for banks. One reason that banks in Ukraine hryvnia liquidity shortage feel is their policy-oriented in terms of devaluation expectations for the accumulation and retention of convertible foreign currency. If they over-rely on their liquidity support through the NBU refinancing instruments. In this case, reasonable exercise of the NBU, in our opinion, may be a temporary cessation of swap operations (foreign exchange to maintain the hryvnia hryvnia liquidity of up to 15 calendar days), or at least set limits on the maximum amounts to operations "currency swap "and raise the cost to banks. It will force banks to abandon the policy of speculative accumulation of foreign currency and sell it on the market to maintain their own liquidity, which will increase the supply of foreign currency in the market, reducing pressure on the exchange rate dynamics and increase the hryvnia liquidity in the banking system of Ukraine. Category: Liquidity of the banking system of Ukraine | Tags: banking system liquidity
Management of its loan portfolio
Credit is the most important area of active operations carried out by the bank because the loan portfolio is primarily a third to half of all bank assets. In the structure of the bank's balance sheet loan portfolio is considered as one component of bank assets and having a level of profitability and risk. Therefore, for successful loan - repayment of loans and increase profitability of lending - banks need to implement an efficient and flexible system for credit portfolio management. The modern bank is able to offer customers over 200 types of various banking products and services, but lending is still one of its main functions. However, the acute is the problem loan portfolio quality. Thus, the inappropriate behavior of economic entities, and often inadequate bank management are pushing banks to hold too risky lending policies, which negatively affects their performance in general. Before the service of bank management problem into account a number of possible risks in lending activities, in particular, the risk of loan default. In such a situation it is important to skillfully manage the loan portfolio and credit risk specifically. Loan portfolio - a collection of credits granted by a bank on a certain date and it characterizes the amount of capital invested in bank lending. Loan portfolio includes an aggregate book value of all loans, including overdue, prolonged and doubtful to return. Category: Management Operations Commercial Bank | Tags: credit
Management of banking risks
In the broadest sense of risk - the uncertainty regarding the implementation of an event in the future. Risk is measured by the probability that the expected event does not occur and will not lead to undesirable consequences. In banking as in other types of business risk is associated primarily with the financial losses that arise in the implementation of certain risks. Risk means the risk (opportunity) loss of the bank of its resources, lost revenue or additional costs incurred as a result of certain financial transactions. In general, the banking sector is highly risky compared with other activities. This feature is caused by? Specificity of the functions performed by each commercial bank. Banks have a lot of partners, customers, borrowers, financial condition that directly affects their position. The activities of the bank is very diverse and includes operations to raise funds, issue and purchase of securities lending, factoring, leasing, providing customers in cash. Implementation of each transaction is associated with the ability to implement multiple risks. As the bank at the same time performs active and passive operations there are risks as credit risk, currency risk, interest rate risk, liquidity risk, the risk of rupture life and attract placement of funds, foreign exchange risk. Category: Management Operations Commercial Bank
Liabilities of the bank - part of the balance sheet
Liabilities of the bank - part of the balance sheet, reflecting in monetary terms, the sources of the funds of the bank. Depending on the source of all bank liabilities differ in terms of attraction and value. Terms of the cost of raising funds depends on the ability of banks to ensure their rational distribution and allowable profit shareholders. Liabilities of commercial banks - those resources that are implemented at the expense of credit, investment and other active operations. Resources are divided into their own, borrowed and borrowed. By their own resources, or to bank capital are owned charter, reserve and other funds established to ensure financial stability, trade and economic activities of the bank, as well as retained earnings of the current and previous years. Shareholders' equity commercial bank performs primarily a protective function - insurance interests of depositors and creditors, as well as covering current losses from banking activities. Equity capital of the commercial bank is divided into primary and secondary. For fixed assets include charter and reserve funds and retained earnings from previous years. Supplementary capital consists of total reserves on active operations and current income. The procedure of forming the statutory fund depends on the shape of the organization of the bank - through a public offering of shares (public company) and by the redistribution of shares among the founders of the bank according to the size of their parts in the share capital (private company). Category: Management Operations Commercial Bank
The organization of non-cash payments based on the following principles
The organization of non-cash payments based on the following principles: 1) The funds of economic entities are subject to mandatory retention on settlement, current and other accounts in banks, 2) cash payments and payments to the company are carried out mainly through the establishment of banks or other credit institutions on a cashless basis of documents provided by the rules of calculation 3) from buyers for the commodity-material values and services are performed after the shipment of goods or services, together with them in order or pre-payment. Payments are made in the manner prescribed by the terms of sale of such goods, and 4) payments for goods and services are performed, usually with the consent of the payer after verification of the supplier contract terms, and 5) payments are made only when there is sufficient funds in the accounts of the payer's bank, under certain conditions can provide a loan to pay suppliers' invoices or take over the function of the payer's guarantor (sponsor) on a commercial basis (at the request of the client's creditworthiness), 6) crediting funds to the payee's account runs as a rule, after writing off the amounts from the account of the payer. The main flows of non-cash settlements with a population include: - Transfer of funds (salary and other income) from the accounts of the company to accounts for deposits in banks - Transfer of insurance premiums, pensions and allowances from the accounts of insurance companies, social security fund to accounts held in banks - Transfer of funds from the account of a company (by proxy accounting company) to the accounts of other businesses (retail, utilities, etc.) - Transfer from deposit accounts to the accounts of trade organizations (settlement payment checks), public institutions (the payment of utility bills), bank institutions (repayment of consumer credit), the issuance of loans for consumer needs - Transfer of interest in favor of the bank's clients to the appropriate accounts. The choice of the state in favor of non-cash money creation can be attributed to several factors. First of all cashless treatment to track cash flow moving in the economy. It is very important, because our country is carrying out an extensive policy of state regulation of the economy and for its implementation is necessary to monitor the magnitude and direction of cash flow. That is why the choice of the state is in favor of non-cash payments. Also contribute to the continuing non-cash assets of the circuit. Between the cash and cashless transactions there is a strong interdependence: the money is constantly moving from one sphere to another, changing the shape of cash banknotes on deposit in the bank, and vice versa. Therefore, non-cash payment transactions is inseparable from the treatment of cash and create with them a common monetary circulation of the country. Category: METHODOLOGICAL FOUNDATIONS OF MONEY EMIS | Tags: cashless
UK banking system
Banking statistics of Great Britain divides all financial institutions into two groups: the actual banking and nonbank financial institutions. Financial institutions are UK Banking Sector Commercial Banks (including clearing banks) Accounts House Merchant banks and foreign banks have syndicated non-bank financial institutions are Building Societies Insurance Companies Investment Companies Pension Funds Credit unions consider the UK banking system. In the current economic climate in which many developing country in the world, the debate about the role and functions of central banks, which began almost from the moment of their appearance, received an additional boost. The effectiveness of monetary policy being implemented by the central bank, many banking experts attributed to his powers and a measure of independence from government. Let us dwell on the heart of the British banking system - the Bank of England. Numerous functions that the Bank of England can be divided into two groups: - Group 1 - direct trade obligations arising from bank status (deposit and lending, clearing and issuing operations) - Group 2 - control functions, through which the state intervenes in the work monetary system, trying to influence the course of economic processes. There are many functions, but they all focused on achieving three main objectives. These include: 1) support the national currency value, mainly through transactions in the market agreed with the Government, in other words, the implementation of monetary policy, 2) the stability of the financial system as a direct control over banks and financial market participants to the City, and by ensure stable and efficient payment system, and 3) ensuring and improving the efficiency and competitiveness of the financial system in the country and strengthening the position of the City of London as a leading international financial center. Like any other bank, Bank of England provides its clients with a range of services. Topic: Banking systems | Tags: banking system
The calculation of the planned amount of different types of income
These calculations are carried out by using a program designed to provide services and conduct banking transactions in the period ahead, given the pricing policy of the bank. Common approaches to the definition of scheduled items of income are 4. Develop a system of measures to ensure the plan proceeds. System of these events developed in the following areas: effective implementation of the developed pricing policy, the use of favorable market conditions, increased levels of customer service, advertising and intensification of information activities, the development of a network of branches and offices and other activities. While operating income a focus on active operations, as the bank's main source of income is income from active operations, so their performance, primarily determines the final financial result. The effectiveness of active operations affect yield of active operation, which is directly proportional to the level of its riskiness, so the choice of specific active operations depends on the overall strategy of the bank and its risk appetite. According to that determined by such approaches to revenue management: conservative (the orientation of the bank's operations with a limited, but highly reliable and stable income), aggressive (priority focus on maximizing profitability, despite the level of risk associated with such operations; this approach is appropriate in the development stage Bank to ensure the rapid growth of the invested capital, as this approach has a high degree of risk, the need for high professionalism of the bank, the existence of formal technology operations and effective risk management system), moderate (diversification of the bank's operations, it is a rational relationship between the high-yield and reliable operations). Category: Fundamentals of Financial Management Bank
Bank of England are different from other banks' customers
Bank of England are different from other banks' customers "class =" alignleft "/> There are three most important groups of customers: 1. Commercial clearing banks. All the clearing banks have accounts at the Bank of England. In the operations of the clearing account used by clearing banks at the Bank of England. These banks are obliged to keep a certain amount in the account, and have no right to exceed it. (All banks operating in the UK, containing 0.35% of the amounts of their deposits in the account (deposit) in the Bank of England) This regulation reserves and provides the main source of income of the Bank of England. 2. Other central banks have an account and keep the gold in the Bank of England and can conduct business in London through the Bank of England. 3. UK Government keeps the accounts in the Bank of England, therefore, charges and taxes in the budget and payments from the budget for social services are conducted through the accounts of the Bank of England. Bank of England has formal independence from the government, while working under the guidance of the Ministry of Finance. Topic: Banking systems | Tags: Banking System
This indicates a highly professional approach
The implementation of high continuous monitoring of the loan. Bank pays great attention to managing market risk (currency, interest rate, etc.). Decisions in this area are taken on the ongoing analysis of various segments of financial market trends and changes taking place. The Bank has established appropriate standards for risk, compliance is constantly monitored by the Committee on Asset and Liability Management. Minimize currency risks through the implementation of certain procedures, limitations, and mechanisms to effectively manage the Bank's open currency position. Most important is the risk of fluctuations of hryvnia against Euro. Therefore, the position relative to the euro is under the personal supervision of the Bank's management. Bank foreign exchange operations carried out in strict accordance with the regulatory requirements of the National Bank and internal regulations. Category: Financial Management | Tags: highly, Credit Risk
Regulyuvannya cash and non-issue
Emission - the oldest function of the central bank. In the XX century. it has undergone significant changes in the transition from system to system, gold standard treatment of paper money, and also due to modification of currency (expanding the use of deposit money, and the emergence of electronic money). In terms of money, not exchanged for gold (final link money to gold broke in 1971, when the U.S. abandoned the further exchange of dollars belonging to government agencies in other countries, in gold), providing money, emitted by the central banks act primarily debt State obligations and commercial paper. Central banks usually have the sole right to issue banknotes throughout the country (with some exceptions). In addition to notes, many countries are in circulation as a bargaining chip. Despite the fact that cash is a small part of the money supply, they form the basis of the monetary system of the country. Cash, issued by the central bank, in many countries is the sole legal tender in their territories. Under the terms of the creation of the European Monetary Union by January 1, 2002, in the territory of the European Community will shalt bring into circulation banknotes and coins, and the European System of Central Banks will exchange national banknotes and coins on the "euro" money. Topic: A PRACTICAL ANALYSIS OF MONETARY ISSUE | Tags: Emission
According to the concept
According to the concept of building a hierarchical system of management of the bank financial analysis appropriate to share the following basic types: strategic financial analysis, financial analysis of tactical and operational financial analysis. Each of these types of analysis should comply with certain of its scope and frequency of exercise of its functions. To address specific problems of financial management there are a number of special systems and analysis methods that allow quantitative assessment of financial performance in the context of some of its aspects as in statics and in dynamics Horizontal analysis is based on studying the dynamics of individual financial performance over time. By using this analysis system calculated the growth rate (growth) of individual financial performance over a number of periods and determined the general trends of change or trend. Vertical (structural) analysis involves determining the structure of financial performance and assess the impact of various factors on the outcome. In carrying out this analysis calculated the proportion of individual structural components of the aggregate financial performance. Analysis of the ratios (ratios) provides for the calculation of the relationship between the individual absolute financial performance of the bank, the definition of the relationship indicators. Using this system, the analysis identifies the different ratios that characterize the individual bank's financial performance and the level of its financial condition. A comparative analysis is based on a comparison of the values of individual groups of similar performance to each other. Using this system, the analysis calculated the size of the absolute and relative deviations of parameters are compared. Topic: Fundamentals of Financial Management Bank
Non-cash issue is a particular problem
Central Bank does not have any formal or de facto monopoly on this issue, and it is not the same means of accounts of commercial banks in the CB. Central banks hold in reserve requirements mainly (which they are required to power in the order of the monetary authorities) and to a lesser extent - the means for clearing. Non-cash issue is not carried out of CB. Commercial and other banks can create money supply by the same methods as the Central Bank. Thus, the overall money supply is regulated, but not its components. Monetary unity, the interaction of the money market with the market of goods and production rates makes control of business activity, give to the state an effective tool. Monetary policy, the main conduit of which, as a rule, the Central Bank should primarily affect the exchange rate, interest rates and the overall liquidity of the banking system and hence the economy. Achieving these objectives aims: to stabilize economic growth, unemployment and keep inflation low. According to the charter of any securities is usually responsible for monetary stability and the national currency and to this end is coordinating its policies with other government agencies. Most often, monetary policy is one element of the entire economic policy and directly formed on the basis of government priorities. Relations between the Central Bank and the government in conducting monetary policy, as a rule, are clearly defined. The government is limited in its actions and usually does not interfere with daily operations of the bank, coordinating with a common macroeconomic policy to distinguish between "narrow" and "broad" monetary policy. Under the narrow policy is meant to achieve the optimal exchange rate by investing in the forex market, accounting policies and other instruments affecting the short-term interest rates. Broad policy has aimed at fighting inflation through its impact on money supply in circulation. With direct and indirect methods of credit control are regulated banking system liquidity and long-term interest rates. Monetary policy should be clearly linked with the budget and tax policy and, accordingly, the financing of the budget. Category: Klasifikatsiya real estate market
The method of portfolio immunization
As the method of immunization provides a portfolio of financial instruments decreased sensitivity to the effects of interest rate risk, there is a need to measure such characteristics as sensitivity. Indicator that is most often used for this purpose, a weighted average maturity of the financial instrument - the duration. Practical implementation of methods of immunization will calculate duration of all cash receipts on assets and all payments on passive operations of the bank, get the depositors, creditors and shareholders of the bank. To determine the duration of the portfolio assets or liabilities of the bank calculates the duration of each financial instrument included in the portfolio, and found performance weigh on market value. The sum of all values obtained is a weighted average maturity (duration) portfolio as a whole. M - number of financial instruments in the portfolio. Since the value of assets exceeds the value of liabilities by the amount of capital the bank, the ratio between the duration of assets and liabilities of the bank is described by the model: Ratio of liabilities to assets is less than 1, so from the above it follows that the duration of the portfolio assets must be shorter duration of the portfolio responsibilities. This means that regardless of the direction of changes in interest rates the bank's assets must be revalued faster than liabilities. Category: Management Operations Commercial Bank | Tags: immunization
Since September 2008, due to worsening global liquidity
. Since September 2008, due to worsening global liquidity, limited access to domestic banks to foreign borrowing, capital outflows and an increase in demand for foreign currency National bank of Ukraine intervened by selling U.S. dollars to maintain exchange rate stability in the country amounting to 150.3 million dollars U.S. in September and 4 114.8 million U.S. dollars in October 2008 [7]. This was one of the factors reducing the hryvnia liquidity of the domestic banking system, but its effect was compensated by the NBU carried out operations on refinancing banks, whose volume in September and October, respectively, 6 was 047.3 mln. and 29 230.16 mln. [6]. Leveling effect of this factor on the liquidity of the banking system is connected only with the transition to a floating exchange rate, which minimizes the direct participation of the National Bank of Ukraine in the regulation of the currency market through intervention. Exchange rate flexibility is a prerequisite for a successful transition to a regime of monetary policy based on price stability, which is scheduled to medium-term strategy of monetary policy the National Bank of Ukraine. The gradual transition to a flexible exchange rate is determined one of the problems in the basic principles of monetary policy in recent years. Orientation of the National Bank of Ukraine for more exchange rate flexibility to reflect the changes projected exchange rate of hryvnia to U.S. dollar, made to the basic principles of monetary policy in 2008. The Basic Principles of monetary policy in 2008 predictable rate of the hryvnia against the U.S. dollar was defined at 15.09.2008 4,85 ± 4%, with 07.10.2008r. - 4,85 ± 8%, and from 27.10.2008 p. - Withdrawn from the projected rates of monetary sphere. Category: Liquidity of the banking system of Ukraine | Tags: banking system liquidity, declining
In 2007, Pravex
Reduction in resource mobilization in 2007 was achieved through the effective use of its own resource base. At the same time, Limit broad base Pravex and loan programs of partner banks under various types of coatings (foreign currency, real estate, securities, etc.) have significantly increased the active resource operations. Operations on the FOREX-market. Pravex-Bank offers its customers not only a full range of traditional services (the ability to become an active participant in the resource market, buy / sell the currency at the interbank foreign exchange market on the best course), but also those which only carries Pravex: exchange and conversion of "exotic "Currency, etc. The total volume of Pravex for buying / selling of foreign currency in 2007 was the equivalent of U.S. $ 314,147,147. Almost two thirds of this volume, namely the equivalent of 210,027,850 U.S. dollars, accounted for purchases of foreign currency. The volume of transactions for the sale of foreign currency - the equivalent of U.S. $ 104119297. Category: Financial Management | Tags: operations on FOREX-market
Solvency of the bank
In 2007, the bank continued to follow the direction of placing funds in the credit market customers, particularly focusing on lending to individuals. Over the past year, loans of individuals increased by 1.86 times and amounted to 59.38% (2,127,760 ths.) All of the assets. In addition, a significant proportion belongs to loans to other banks (10.61% or UAH 380 277) and legal persons (7.12% or 255 135 ths.) Property in the structure of bank assets was 8.79% (315 055 ths.) (Figure 3.3). With a view to adopting the basic principles of the policy of asset and liability management the Bank to further improve the work of the Assets and Liabilities Order of the Chairman of the Board of JSCB "Pravex" approved "Regulations on the policy of asset and liability management JSCB" Pravex. "The main purpose of Policy liabilities of the asset management i JSCB "Pravex" is to develop the basic principles of the policy liabilities of the asset management i JSCB "Pravex" in order to maintain an optimal balance between risk i return. The policy of Assets and Liabilities of JSCB "Pravex" is based on the integral method of asset and liability management, which means using two methods: the method of combining funding sources and the method of separation of sources of funding for active operations. Category: Financial Management
Summing up, the following features of the chart of accounts
1. Multicurrency. Chart of Accounts provides multicurrency accounting operations. Foreign currency transactions are recorded on the same accounts as the transactions in hryvnias. The relationship between the operations in foreign and national currencies provide technical account: Account currency position by currency hryvnia equivalent positions. 2. Double-entry operations on off-balance sheet. 3. The Plan provides for a account management accounting. 4. Structural and logical connection of synthetic and analytical accounting. Analytical accounting is provided by means of analytical accounts. The discovery of any analytical accounts requires a mandatory parameter according to the National Bank of Ukraine. Additional information required for management of the bank, the bank can be determined independently. Topic: The role of accounting in the management of the bank, its types and destination
It is important to determine which factor has the greatest effect
For example, in determining the productivity of the retail business is necessary to examine its internal processes such as: credit, the commission services in the securities exchange, the organization of payments, etc. A considerable attention should be paid to the analysis of business processes, as reflected in work plans. Based on the analysis of processes determine the costs for each of them, identified the factors that led to an increase in costs or decrease revenues and identified performers processes. This allows for optimization of processes as the technology for their implementation, as well as the work of artists. Improving the performance of retail banking business is achieved through growth in the number: consideration of loan applications, clients and accounts that are serviced by professionals; processed payment orders, etc. To increase efficiency of business processes to determine the retail banking management options, focused on marginal costs. For this set cost standards according to the standard processes used for the calculation and the calculation of costs and travel time and processing. An important driving force behind the strategy is robust, clear and transparent system of motivation, which is essential to effectively manage the bank. Category: Uchot bank ucherizhdeny
Users of accounting information
Are divided into internal and external depending on the relationship to the bank as a business entity and the ability to access financial information about the activities of the bank. External users include lenders, investors, customers, bank employees, the bank's shareholders, as well as public administration, supervision, tax authorities, the information they need: to make a decision as to whether the bank's shares worth buying, be it customer or depositor; for assess the possibility of the bank to repay loans, warning people of the negative phenomena in the bank to its timely readjustment, averting the threat of bankruptcy or to mitigate its consequences for depositors and bank customers, for the formation of monetary policy. Availability of information to directly influence the activities of the bank. This information is provided as part of financial accounting. External users are not able to identify any specific requirements, except for the applicable legislation. According to international practice, investors and lenders are considered as the main users, namely to satisfy their interest banks are required to disclose financial information. Publicity of information increases the liability of banks for the results of its activities to the community. Internal users - is the bank's management. He information needed for decision making on all issues of bank management: strategic and tactical management, budgeting, financial management, optimization of resources, etc. Topic: The role of accounting in the management of the bank, its types and purpose | Tags: Community
The Law of Ukraine
The Law of Ukraine "On State Budget of Ukraine for 2009" contains a provision that government bonds are subject to mandatory redemption of Ukraine National Bank of Ukraine at their nominal value within three banking days after receipt of proposals for their redemption from banks (Article 84). In addition, Article 85 states that in the event of shortfall in general fund revenues of the state budget according to the monthly painting for holding the protected articles of the state budget to allow the Cabinet of Ministers of Ukraine to carry out government borrowing in excess of amounts set out in Annex 2 to this Act with a corresponding adjustment to limit the amount of state Ukraine's debt as defined in Article 11 of this Act. The volume of government borrowing made the Ministry of Finance increased the figures of financing the state budget in excess of amounts approved in Appendix 2 to this Act. These provisions could trigger increased inflationary pressures. However, high inflation, on the one hand, it "eats" good intentions the power to raise social standards (if within 11 months of 2007 with an increase of nominal income growth of 29.9% real 12.5%, in January - November 2008 with an increase of nominal income Ukrainian 40.1% growth of real total was 11.4%), and on the other - reduces the competitiveness of Ukrainian economy. [20] In this context, the proclaimed intention of the nominal minimum wage in 2009 will further increase confidence in the declarations of the Ukrainian authorities (Government) regarding the ability to overcome inflation and restore financial stability. Category: Bankovskie sistemy
First of all
The views on this before the direction inherent in the heads of the banks have found themselves in a difficult position. They are almost spontaneously seek approaches to its correction, and further try to improve the strategic management of the bank. Note that the leaders of the majority of banks believe in the inviolable stability of their activities and are the subject of almost a cool, not taking into account the danger of such a position. Therefore, for controlling the introduction of practical activities of domestic banks to overcome the barrier of complacency of their leaders and experts, existing mainly due to lack of awareness about the benefits of controlling a support system for bank management, particularly strategic management of the bank. For this purpose it is expedient to develop a "philosophy of controlling bank", the main components of which may be to determine the nature and location of the controlling system of strategic and operational management of the bank, culture, models, objects and purposes of controlling, its methodology and tools, milestones, etc. In determining the conditions for implementing a controlling system to determine route of administration, financial and human resources required by this process, as well as software and hardware, which will be based system, etc. With the introduction of controlling can be used two fundamentally different approaches: the "bombing" or "smooth part". Under the approach of "bombing" is the sudden introduction of a controlling system. To successfully implement this approach, bank management should ensure that conflict of interest by the use of sanctions or incentives for employees involved in the process of controlling. The advantage of this approach to controlling the introduction of a bank is to implement reforms without delay and much difficulty. However, it has disadvantages, because its implementation is necessary to attract a significant amount of information processing which requires a certain amount of labor, material costs and time. However, in the future, with the creation of databases, such costs are greatly reduced. Approach "smooth part" suggests the involvement of all stakeholders, in collaboration with developed which is acceptable to the Bank's program of implementation of tasks for the implementation of controlling. In order to avoid the asymmetry of power to run this program may additionally appointed external consultants. This approach facilitates a better understanding of stakeholder objectives change that positively affects the speed and quality of their implementation. Topic: Controlling Improvement | Tags: First
In addition
Create, implement operational and constantly actualized system of internal credit ratings - based on actual observations on a quarterly basis to calculate the probability of migration matrix of credit ratings and to assess its value based on the required reserves for credit losses in future periods; - Provide back-testing of migration internal credit ratings on real data on the maximum possible period of time. Banks are also urged to consider the world's best practices for managing credit risk, which, inter alia, set out in the Basel Committee on Banking Supervision, "Principles of credit risk management," where Banks encouraged to introduce the process of managing credit risk, which takes into account the risk profile of institutions, but also contains prudential guidelines and procedures for identifying, evaluating, monitoring and control of credit risk (including counterparty risk). Credit risk management, according to this document must include procedures for granting loans and investments, assess the quality of such loans and investments and ongoing management of the loan and investment portfolios. Management of credit risk the bank is carried out at two levels in accordance with the reasons for its appearance - at the level of each individual loan level and portfolio as a whole. The approaches to risk management, loan portfolio diversification belong; limitation, the establishment of reserves to compensate for losses on credit operations of commercial banks, securitization. The total loan portfolio risk depends on the riskiness of loans, which it is formed, so to determine the portfolio risk is necessary to analyze the risk of its parts. The risk of the loan portfolio is mainly due to its imperfect structure, as well as to the quality of its components (individual loans). For example, an excessive concentration of loans in a certain economic sector creates a dependency on the state of the state bank of the industry. Topic: Risks in Banking | Tags: control
Management must determine
Management should determine which branch of the bank to implement in daily practice of controlling these functions. Often, these responsibilities are assigned to the collection and processing unit of the general economic information, which performs the following tasks: - Participates in the development of strategic and operational plans of the Bank - provides the current vertical and horizontal coordination of data for planning - evaluates and assesses the accounting information necessary to monitor operations and processes, with the orientation of a positive result - controlling unit, providing for the adoption of every administrative decision of forming the appropriate knowledge base, must - find out the actual situation in the bank regarding a particular issue and report to management on results - determine the causes of deviation Evidence from the plan - to offer possible solutions deviations from the planned indicators - forecast planned program of activities, taking into account the real situation and possible changes in the interbank market and capital investment. The purpose of controlling the same as the overall goal of the banking institution and is to ensure that: - optimize financial performance by maximizing profit - capital adequacy, subject to the established National Bank liquidity. Category: Uchot bank ucherizhdeny
The main activities of the bank in this area are
Improvement of existing lending standards, monitoring and control of credit risks in order to identify potential problems with the return of credits, and adoption of adequate solutions; balanced policy in the field of collateral, the improvement of existing regulations the decision-making procedures, risk assessment and management, creation of reserves under active operations. To reduce the credit risk of the system is used and conditions of lending by maturity, borrowers, welfare, interest rates and the ways (methods) of their charges, limitation, diversifying the loan portfolio, provisioning, monitoring and risk control. Monitoring of individual credit risk on the borrower - legal entity provides a preliminary assessment of the creditworthiness, financial analysis, assessment of internal and external environment, the analysis of market position, cash flow forecast, assess the reliability and credit history, as well as evaluating the liquidity support credit transactions. Bank assessment of risk factors on the basis of qualitative and quantitative indicators, according to the relevant interbank techniques for assessing the credit risk of short-and long-term loans. According to the analysis and evaluation of the category of credit operations, credit risk is compiled map of the borrower, which gives a full description of all possible risks of the borrower's business and represents a comprehensive assessment of the likelihood of default by the borrower commitments, as well as the risk of co-operation with Pravex Bank. Category: Financial Management
Strauss-Kahn encouraged countries
Strauss-Kahn recommended that countries with developed economies use fiscal policy, where possible - particularly in the financial and housing sectors. Emerging markets, may use reserves to fund a temporary or a sudden shortfall in capital. Others will raise interest rates the central bank in accordance with an increase in the risk premium in order to prevent capital outflows and build confidence in the national currency. Some countries will probably need considerable support, including from the International Monetary Fund. According to Strauss-Kahn at the IMF is liquidity in large volumes. Developing countries are faced with a reduction in export demand and reduced access to trade credit. In addition, many of them are already suffering from food and fuel crisis, which causes a tight budget and balance of payments, leads to higher inflation and cost of living. Strauss-Kahn expressed his commitment to the IMF to help countries that are experiencing difficulty, and said that the International Monetary Fund is ready to quickly provide loans. In particular, Ukraine's IMF provided a loan amounting to 16.5 billion U.S. dollars to combat the effects of the global financial crisis. Several countries, including Ukraine, has taken several steps to minimize the impact of the crisis, which has already yielded positive results. Closing the Internet conference, Professor Baranowski noted that research on the financial crisis will continue into 2009. The results will be reviewed and summarized, and conclusions and recommendations will pass for inspection at the National Bank of Ukraine. NBU Banking University and later practiced research on current topics of financial-credit sphere, to help the state in solving urgent problems. Category: Liquidity of the banking system of Ukraine | Tags: Strauss-Kahn
According to Ukrainian standards
Non-interest expenses include commission costs (for CSC, the loan service fee expense on securities, the cost of transactions in currency and other commission expenses), other bank operating expenses (deductions to fund the Deposit Guarantee); penalties for banking operations, other non-operating expenses (personnel expenses, paying taxes, the cost of telecommunications, and other operational and economic costs), allocations to provisioning and write-off of doubtful assets and contingencies. With regard to the content management process income and expenditure and requirements are presented to them, form goals and objectives. The main objective of cost management is to minimize wastage, that is, those costs do not lead to increased profits. Reducing overhead costs, the bank is known to quickly form a pool of funds that can be directed to its development. However, the practice of most Ukrainian banks, which differ in terms of volume and range of operations that allows you to mark a stable tendency of rapid increase in the cost of growth of income of banks. Topic: Fundamentals of Financial Management Bank | Tags: commission expenses
Banking risks are classified as on
- The sources of - systematic (systemic) and unsystematic - The causes - uncertainty about the future, unpredictability, lack of information;-Ability to minimize - the risk, which may be reduced risk, that does not minimize - the degree of risk - the risk-free activity , minimal risk, increased risk, a critical risk, catastrophic risk - The impact on individual performance - profitability risk, the risk of income, risk costs, risk treatment, risk of liquidity. Particular attention is given to the classification scheme should be paid to the systemic risks that characterize the instability (unreliability) of the entire monetary system and can be implemented in the form of a systemic crisis. As a kind of systemic risk is considered the risk of economic crisis in certain sectors of the economy or the economic crisis across the country. The main area of habitat, distribution and marketing of systemic risk is the banking sector. Being in the heart of the financial interaction of a large number of economic agents, processing and distributing massive amounts of information, the banking system more vulnerable to systemic risk. At the same time, it has great potential for the spread of risk. Even such traditional banking activities, such as credit and deposit and payment, not to mention the new banking: investment in securities, factoring (a form of poserednichskoi), leasing (a type of investment), provide a great opportunity for the emergence and spread of risks. Warnings of systemic risk - an extremely important task that comes first before the monetary system of Ukraine at present. And the solution to this problem is possible only "from below", ie with each individual bank. For the bank, the main types of risk associated with the structure of its portfolio, ie with a set of financial assets that are embedded in the resources of the bank. In economic theory, there are three types of portfolio risk: credit risk, liquidity risk, interest rate risk. Topic: Risks in Banking
