Determine the financial stability of the Bank. Financial stability of the bank. Methods for analyzing the financial condition of the bank
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Financial Sustainability Commercial Bank
Chagyna G.S.
In modern economic conditions, the aspect of the sustainability and reliability of Russian commercial banks is of particular importance. Their difficult financial situation, on the one hand, and the need to expand investment in the economy, on the other, to a certain extent, exacerbate the problem, turn it into one of the most relevant theoretical and practical issues of the national economy. The stability of banks is not only an attribute of the modern policy of their survival, but also a strategy for the development of credit institutions. From how commercial banks will develop, the success of the economic reforms in Russia largely depends.
Banks are part of a single economic body, one of the most important sectors of the economy. The financial condition of banks and the economy as a whole is two reporting interconnected vessels. From how things are in each of them, not only their own development depends, but also the development of social relations in general. It is known for example that the effective development of banks has a positive effect on investment activity, in general, on economic growth. On the other hand, the efficiency of the functioning of banks is largely depends on the state of the economy and especially from its production sector, since in the conditions of the crisis and a decline in investment activity, the main "center of gravity" of the banks is shifted towards conducting speculative high-rise operations.
Financial stability is a financial condition in which the economic activity of this enterprise provides under normal conditions to fulfill all its obligations to employees, other organizations, the state, due to sufficient income and compliance of income costs.
The financial sustainability of the enterprise is influenced by various factors:
position of the enterprise in the commodity market;
production and production of cheap, high-quality and in demand in the product market;
its potential in business cooperation;
degree of dependence on external lenders and investors;
the presence of insolvent debtors;
efficiency of economic and financial operations, etc.
Financial sustainability of banks is extremely important for stable and progressive economic development. Allocate various methods for measuring and evaluating the financial stability of banks, one of which is based on the calculation of groups of coefficients characterizing the level of stability of the banking sector from various sides.
There are types of financial stability - indicated in Figure 1.
The basic set of financial stability indicators includes coefficients characterizing capital adequacy, asset quality, profits and profitability, liquidity and market risk sensitivity.
Traditionally, the assessment of the Bank's financial stability involves the use of a certain set of indicators, which in our case can be grouped as follows:
Capital adequacy indicators;
Liquidity indicators;
Indicators characterizing the qualities of liabilities and assets;
Profitability indicators.
Capital adequacy indicators. The first indicator of the stability of the bank is not only in order of priority, but also in importance is the adequacy of capital, or capital adequacy of the scale and nature of the operations carried out by the Bank. Such capital, as is known, forms a peculiar "pillow", which allows the bank to remain solvent and continue operations, in spite of any events.
This definition is given by E. Reed, R. Kotter, etc.: Capital adequacy is the ability of the Bank to compensate for losses and prevent bankruptcy. Sharing this point of view, we will give your own definition. Capital adequacy is the ability of the Bank to continue to provide the traditional set and standard quality of banking services in the same volume, regardless of the possible loss of one or another on active operations.
As indicators of capital adequacy, bankers and supervisory bodies mainly use two groups of coefficients:
the first group is based on the relationship of capital funds (in different composition) to general deposits (deposits);
the second group is based on capital ratio (in all sorts of modifications) and assets (various composition).
Indicator liquidity. Liquidity ratios monitor the adequacy of funds and other liquid assets to meet unforeseen cash demand, as well as the ability of the Bank to meet the requirements for short-term liabilities, such as removal of funds from claims, not experiencing problems with liquidity.
Indicators characterizing the qualities of liabilities and assets. The following group of indicators characterizes the quality of assets that allow you to assess the status of the bank's credit portfolio. This is an integral part of the analysis of financial sustainability, since the quality of loans issued has a direct impact on the financial results of the bank. The growth of overdue loans increases the risk of incomplete income and the non-return of the funds provided, which can lead to the problems of execution by the Bank of their obligations. The Bank must follow the quality of the loan portfolio to ensure its sustainability, carefully choose the range of potential borrowers. The share of distribution of loans by sectors in the total amount of loans makes it possible to identify the degree of concentration of loans issued by a particular sector.
Traditionally, the quality of liabilities is characterized by the stability of the resource base, the cost of attracting, sensitivity to changes in interest rates and dependence on external sources of financing, such as the interbank market of short-term capital.
Profitability of the bank. As you know, the profit also characterizes the stability of the credit institution. It is necessary to create adequate reserve funds, stimulating personnel and manuals to expand and improve operations, reduce costs and improve the quality of services provided and, finally, for the successful implementation of subsequent emissions and, accordingly, the growth of capital to expand the volume and improve the quality of the services provided. The value of banking when it was difficult to overestimate. It is important for all participants in economic life and depends on a number of factors: from interest paid and paid on banking operations; from the share of non-interest income; current expenses; from the structure of assets and liabilities. Returning reserves are usually found in increasing the efficiency of assets use by increasing the share of "working" or bringing interest income and reduce assets that do not bring revenues (cash registers, correspondent and reserve accounts, investments in fixed assets, etc.).
It is not by chance that the concept of "highly profit banking activities", which was widespread in the United States, is based on three "whales":
maximizing revenues
minimizing expenses
competent and efficient management.
As for the attitude of the net open currency position to capital, it allows you to identify the degree of dependence of banks from the exchange rate dynamics, that is, exposure to currency risk. In my opinion, this indicator is important for countries in which banks actively carry out transactions with foreign currency and their national monetary unit strongly depends on the situation in the foreign exchange market.
Bibliography
bank Stability credit
1. Fetisov G.G. Sustainability of a commercial bank and rating systems of its assessment - M., 1999.
2. Grachev A.V. Analysis and financial sustainability management of the enterprise: a training and practical manual. - M.: Publisher "Finpress", 2002. - 208 p.
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As well as . The financial stability of the Bank means the constant ability of the Bank to respond to its own and provide profitability at the level sufficient for normal functioning in the competitive environment.
There are three main types of financial sustainability of the Bank in stability of its work:
- normal stability, which is characterized by stable activity, lack of non-payment or delay in fulfilling its obligations, stable profitability;
- an unstable financial condition characterized by delaying payments, the inability to fulfill its obligations in a timely manner, low levels of profitability and the like;
- crisis financial condition characterized by regular defaults, the presence of overdue debts and the like.
A crisis financial condition can lead to a bank to finance current activities, make payments and fulfill their obligations, and ultimately to.
The financial sustainability of the Bank is estimated by all its (stakeholders): shareholders, management, customers, counterparties banks, investment community, regulator and state. As a rule, these processes use a set of indicators that can be divided into two large groups:
- financial indicators;
- business characteristics.
Financial indicators
- structure and quality and;
- capital adequacy;
- profitability and efficiency of activities.
Financial indicators reflect the financial implications of all completed and current bank operations. They have a monetary or other quantitative expression and are calculated on the basis of data or.
For the purposes of such an analysis, assets are ranked according to the degree of liquidity, and liabilities - in the degree of increase in stability and are combined into the following large aggregates:
- for assets:
- liquid assets (which can be quickly and without significant losses for the bank are transformed if necessary or them);
- urgent assets (loan portfolios and portfolios traded in the financial instrument market);
- immobilized assets (problem debt, investment and property that do not bring regular money revenue to the Bank);
- for liabilities:
- unstable liabilities (bank borrowed resources that can be withdrawn by customers at any time, incl. at moments);
- stable liabilities (borrowed resources that the bank can hold throughout the term determined for him, including non-external balances on customer transaction accounts);
- own funds.
Business characteristics include such elements:
- risks associated with the Bank's capital structure and the level of its concentration;
- bank management quality;
- competitive position of the bank in the market;
- image of the bank;
- bank;
- business reputation bank.
Business characteristics make it possible to take into account the impact on the financial stability of the Bank of such events of its activities, the financial implications of which is quite difficult to estimate on the basis of existing information. However, these events, as a rule, can significantly affect the future cash flows of the bank. For example, the availability of conflicts among shareholders can lead to a deterioration in the capital base of the bank, and its innovative ideas to ensure that they have access to the markets that have previously been unavailable.
The financial stability of the Bank is determined on the basis of assessing the quality of assets, capital adequacy and the effectiveness of its activities. At the same time, the financial stability of the Bank assumes the presence of sustainable capital, liquid balance and adequate level of solvency.
The financial stability of the Bank lies in the ability to withstand destructive fluctuations, while performing operations to attract funds into deposits of individuals and legal entities, opening and maintaining bank accounts, as well as the placement of attracted funds from their own behalf and at their own expense on terms of payability, urgency and repayment .
Ultimately, the financial stability of the Bank determines the stability of the Bank's financial position: the balance of its finance, the liquidity of the assets, the adequacy formed, the adequacy of capital, etc.
Financial stability is the most important characteristic of the financial activity of a commercial bank in a market economy. Its provision is one of the most acute problems in the activities of commercial banks. If the commercial bank is financially stable, it has competitive advantages over other commercial banks, which finds an expression in attracting additional resources, dominance on a thorny market segment, increasing contributions from the population as a main source of banking resources and, accordingly, in expanding the investment investment sphere, Opportunities to develop new non-traditional services and others. In addition, a financially sustainable bank creates a favorable external environment, that is, does not enter into conflict relations with the state and society, since in a timely manner and fully pays taxes in the budget and extrabudgetary funds, workers working and employees, dividends to shareholders, returns borrowed funds to their creditors.
The financial stability of the Bank can be appreciated by the quality of assets, capital adequacy and efficiency. The position of the commercial bank is steadily, if it has a steady capital, has a liquid balance, is solvent and meets the requirements for capital quality. Under the financial financial stability of the Bank, its ability to resist destructive fluctuations, while carrying out operations to attract funds to the deposits of funds from individuals and legal entities, opening and maintaining bank accounts, as well as the placement of funds raised on their own behalf and at their own expense on terms of payability, urgency and repayment.
But in general, the financial stability of a commercial bank is the financial sustainability of its financial position in the long run. It reflects such a state of financial resources in which the commercial bank, freely maneuvering with money, is able to provide their effective use to ensure an uninterrupted process of implementing its economic activity.
Describing the concept of "financial stability of a commercial bank," we define its main signs.
Thus, in the sustainable development of banks, the population is directly interested, which, thanks to its savings, forms a resource base of a commercial bank. Deposits of the population are not only significant, but also a sustainable bank resource.
Direct interest in the sustainability of credit institutions also show customers and counterparties that are directly related to the formation of a resource base, operational function on various market segments. A commercial bank traditionally serves enterprises of various sectors of the economy, organizational and legal forms of ownership, fields of activity. The fact that in the context of the possibilities for enterprises and organizations, the opening of several settlement accounts in various commercial banks is actually formed by multiplicity of interests, since the same enterprise becomes interested in the activities of several commercial banks with which it interacts. From this point of view, you can also consider the counterparty banks with direct correspondent relationships with each other.
The sphere of direct interest in the sustainable functioning of commercial banks also includes a state that is interested in timely tax revenues. However, the interest of the state has some specific features associated with the need to maintain the stability of the banking system, its development and strengthening. This is one of the main objectives of the Central Bank of the Russian Federation. By performing supervisory and regulatory functions, the Bank of Russia seeks to ensure the sustainability of the banking sector of the Russian economy.
Second signthe concepts of "financial sustainability of a commercial bank" is the dependence of sustainability and quality of resource potential. The resource potential of the Bank predefines the qualitative level of the Bank's financial stability. The larger the amount of resources attracts the bank and the quality of these resources, the more active activities to invest our resources, the more it strengthens its financial condition and, accordingly, financial financial stability.
Third sign -the financial stability of the commercial bank is a dynamic category, which is a property to return to an equilibrium financial condition after exiting it as a result of any impact. Based on the financial stability of the Bank, its performance is largely revealed, since in order to be workable and function to function, the commercial bank must be insensitive to foreign perturbations of various kinds for a sufficiently long period of time.
Decisive, in this case, the relationship between customers and counterparties with the bank should be. Customers when establishing partnerships with a commercial bank, are calculated on uninterrupted settlement and cash services, the possibility of obtaining loans if necessary, the provision of various banking services. Otherwise, under the conditions of banking competition, the client can switch to service to another bank, which meets all the requirements. Counterparty banks are also interested in sustainable, guaranteed relationships with partner banks, focusing mainly to the reputation of a partner and the actual financial situation. Thus, customers and counterparties of commercial banks are directly interested in their uninterrupted work, both at a certain point in time and in the long run.
In general, when considering the category "Financial Sustainability of the Commercial Bank", it is important to emphasize that all considered features should be at the same time being present in the object under consideration. This is explained by the fact that each sign carries its burden, the absence of any of them weakens the position of the bank and behaves inevitably to the emergence of various problems.
Thus, the financial stability of the Bank is the financial independence of the changing market situation, it is financial independence during politics, this is the basis for sustainable customer relationships and the base for continuous expansion of activities. This type of sustainability of the Bank determine the main integral financial and economic indicators of the Bank's activities, which synthesize the characteristics of other economic components of its sustainability: the volume and structure of own funds, the level of income and profits, liquidity, etc. So, it can be said that financial sustainability expresses the economic sustainability of the commercial bank in the relevant financial indicators.
The financial stability of the Bank can be managed by carrying out a set of measures aimed at strengthening the position of the bank in the banking system as a whole. First of all, this is achieved by ensuring the optimal financial condition and the development of an effective bank development strategy.
In general, the financial stability management of a commercial bank consists of regulating all types of sustainability listed above. The combination of financial and organizational sustainability includes the process of making strategic decisions and suggests:
Collection and processing of information
Developing solutions
Management consulting,
Control, analysis,
Regulation,
Organization and optimization of the organizational structure,
Business planning of the bank and its divisions,
Management staff management.
Functional financial sustainability includes the execution of decisions made on the implementation of banking operations and services:
Bank specialization (investment, mortgage, innovative, savings, etc.),
Universalization of the Bank with a set of traditional and specific banking operations and services.
Commercial and capital sustainability include the Bank's Communications, the Bank's methodological support of the Bank, system software, application software and functionally technological support, management of traditional bank risks and the management of the bank's own and borrowed capital.
Ministry of Education and Science of the Russian Federation
Federal Agency for Education
State Educational Eslagan
Higher professional education
"Kursk State University"
FacultyEconomics and management
Department Finance, loan and taxation
COURSE WORK
In the discipline "Organization of activities of commercial banks"
on the topic"Evaluation of the financial sustainability of a commercial bank"
Performed: Student 47 Groups
Specialty "Finance and Credit"
Full-time form of education
Sychev Vitaly Sergeevich ______
Checked: Ph.D., Associate Professor Artemov V.A. _______
Evaluation
Kursk 2009.
Introduction .................................................................................... .3.
Theoretical aspects of financial stability
commercial Bank ......................................................................5
Estimated formulas for determining the indicators of capital assessment and assets ................................................................................................14
A group of indicators of estimates of profitability ............ ..16
Indicators that determine the liquidity of the commercial bank and the methods of their calculation .......................................................................................... .18
The role of OJSC Sberbank of Russia in the banking system of Russia ............................................................ ... .................. ..22
Analysis of financial stability indicators of OJSC Sberbank of Russia .............................................................................. ... 26
The concept of financial sustainability of a commercial bank .................. ..5
Objectives for analyzing the financial stability of a commercial bank ......... ... 8
Information base to assess the financial stability of a commercial bank ................................................................................. 9
Methodology for analyzing the financial stability of a commercial bank ...... 13
Evaluation of the financial stability of OJSC Sberbank of Russia ............................................................................................................ ..22
Conclusion ............................................................................ .. ... 39
List of used sources ................................................ ..40
Applications
Introduction
Recently, the situation in the financial markets of Russia has changed significantly. This is due to the growth of production, albeit a minor and increase in investment in the national economy against the background of a decreasing total amount of non-payment and a rigid monetary course of the government. All this leads to an increase in the resource base of commercial banks, customers have the ability to choose a bank, and this leads to a significant increase in competition between banks. And so, it is in this situation, more than ever, stable partners are needed.
Financial stability is a comprehensive characteristic of the quality of the commercial bank and includes 2 aspects: an objective - the ability to fulfill specific obligations; And subjective - the ability to inspire confidence in fulfilling their obligations.
Especially acute the issue of financial sustainability rises during the financial crisis, when many banks are forced to leave the market. In such conditions, depositors more closely relate to the choice of credit institution and seek to cooperate only with proven banks. Therefore, one of the main tasks of the commercial bank is the persuasion of potential customers in their reliability and financial stability.
To increase the financial stability of a commercial bank, one should operate with a whole complex of measures and methods, when managing assets and liabilities of the bank, profitability and risks.
The purpose of the study is to study the methodology for assessing the financial sustainability of a commercial bank on the example of Kurskprombanka OJSC. To achieve the goal it is necessary to solve the following tasks:
determine the concept of "financial stability";
establish the tasks of analyzing the financial stability of a commercial bank;
determine the methods for assessing the financial stability of a commercial bank;
determine the sources of information necessary to evaluate financial stability;
apply the methods for assessing the financial stability of a commercial bank to calculate the financial indicators of Kurskprombanka OJSC;
to identify the weaknesses of the activity of JSC Kurskprombank and develop appropriate recommendations for their improvement.
The main sources of information used in the process of study were federal laws of the Russian Federation and regulatory acts of the Bank of Russia, teaching aids on economic theory and discipline "Money, credit, banks", scientific journals "Bulletin of the Financial Academy", "Economic Sciences", "Finance and Credit".
1. Financial stability as an economical category
1.1. The concept of financial sustainability of the bank
Financial stability is such a state of the company's financial resources, their distribution and use, which ensures the development of production (and services) based on profit and capital growth while maintaining solvency and creditworthiness in the conditions of permissible risk level; The Company's position parameter, that is, the company's position on the ratio of assets and liabilities for a certain period of time.
The concept of "financial stability" currently has numerous interpretations. However, there is still no clearly developed definition of "financial sustainability" in relation to commercial banks. The authors of many tutorials offer various approaches to the interpretation of the definition of "Financial Stability of the Commercial Bank":
The financial stability of the Bank can be evaluated by the quality of assets, capital adequacy and efficiency;
The position of the commercial bank is steadily, if it has sustainable capital, has a liquid balance, is solvent and meets the requirements for capital quality;
Of paramount importance in determining the financial stability of the Bank gives its own funds;
Under the financial stability of the Bank, it understands its ability to withstand destructive fluctuations, while performing operations to attract funds to the deposits of physical and legal entities, opening and maintaining bank accounts, as well as the placement of funds raised on their own behalf and at its own expense on terms of payability, urgency and repayment. That is, the author emphasizes attention to the ability of the Bank to provide a complex of specific banking services for adequate quality.
But in general, Russian economists and practitioners in the field of banking are converging in the same way that the financial stability of a commercial bank is the sustainability of its financial position in the long run. It reflects such a state of financial resources in which the commercial bank, freely maneuvering with money, is able to provide their effective use to ensure an uninterrupted process of implementing its economic activity.
Describing the concept of "financial stability of a commercial bank", we define its main signs.
First feature – the category "Financial Sustainability" is a public category, which is manifested in the interest of society and its members in the sustainable development of commercial banks. Thus, in the sustainable development of banks, the population is directly interested, which, thanks to its savings, forms a resource base of a commercial bank. Deposits of the population are not only significant, but also a sustainable bank resource. Direct interest in the sustainability of credit institutions also show customers and counterparties that are directly related to the formation of a resource base, operational function on various market segments. A commercial bank traditionally serves enterprises of various sectors of the economy, organizational and legal forms of ownership, fields of activity. From this point of view, you can also consider the counterparty banks with direct correspondent relationships with each other. The sphere of direct interest in the sustainable functioning of commercial banks also includes a state that is interested in timely tax revenues.
The second signatures "Financial Sustainability of the Commercial Bank" is the dependence of financial sustainability on the volume and quality of resource potential. The resource potential of the Bank predefines the qualitative level of the Bank's financial stability. The longer the amount of resources attracts the bank, and the better the data of the resources, the more active activities to invest our resources, the more it strengthens its financial condition and, accordingly, financial sustainability.
The financial stability of a commercial bank is a dynamic category (third sign), which is a property to return to an equilibrium financial condition after leaving it as a result of any impact. Based on the financial stability of the Bank, its performance is largely revealed, since in order to be workable and function to function, the commercial bank must be insensitive to foreign perturbations of various kinds for a sufficiently long period of time. Thus, customers and counterparties of commercial banks are directly interested in their uninterrupted work, both at a certain point in time and in the long run.
From the standpoint of customers and depositors, a steady bank is associated with confidence that the Bank will fulfill the obligations taken before them.
Some other shades have the concept of sustainability from the position of the bank itself. However, it is not all unambiguous. For example, the shareholders of the Bank, investing in banking activities of their capital, believe that the bank will be a revenue place of capital, which it is here that profit will be obtained, equivalent profits from investments in other sectors of the economy. In general, they are interested in sufficient income on their capital.
There is its own position and employees of the bank who are interested in continuing work in a given credit institution, and therefore in obtaining high wages. In their opinion, a steady bank is the one that gives them confidence in well-paid employment.
The assessment of the stability of banks is carried out by the specialists of the Central Bank.
Thus, the sustainability category of the commercial bank includes two aspects: objective is the ability of the Bank to fulfill specific obligations and subjective - the ability to inspire confidence in fulfilling their obligations.
The study of the financial sustainability of a commercial bank includes the study of the essence of this concept, processes and patterns of development, analysis of the evolution of this phenomenon.
The financial stability of the commercial bank is determined through the system of indicators describing:
Quality of bank assets;
Quality of the resource base;
Quality of banking products and services;
Profitability of the Bank's activities;
Management of risks;
Quality of bank management.
The methodology for evaluating financial sustainability was developed by the Bank of Russia to participate in banks in the deposit insurance system - indication No. 1379-from January 16, 2004 Methodology involves the calculation of the group of capital assessment indicators, assets, quality of management, profitability and liquidity.
In the theory and practice of bank management traditionally allocate such essential areas of analysis, such as liquidity, solvency, cash flows, profitability of individual operations and services, capital adequacy. At the same time, in the Russian context, it is customary to lift these areas of analysis with the directions of state control and supervision by the Bank of Russia. As part of this concept, these indicators are included in the methodology for analyzing and assessing the quality of assets.
Lopatina Tatyana Valerievna
E.- mail: tanyushka. [Email Protected] iNBOX. . ru
Kostromin Daria Alexandrovna
student 3 Course of the Economic Faculty of Vglta, Voronezh
Kuznetsov Sergey Aleksandrovich
scientific Director, Assistant Department of Economics and Finance
In modern conditions, a decrease in the degree of sustainability of commercial banks, strengthening the competition, the emergence of crisis phenomena in the banking sector, the constant change in the external conditions in which commercial banks operate, require an appropriate response from commercial banks - a deep assessment of their financial stability, finding ways to increase its financial sustainability .
An important indicator of the state of the organization is its financial stability - the degree of independence from creditors. The financial sustainability of the organization is characterized by the balance sheet structure, as well as the financial results of its economic activity. The financial sustainability of the organization depends on its ability to ensure stable excess of income over costs (make a profit), on the ratios of the production reserves and the values \u200b\u200bof their own and borrowed sources of their formation, as well as on the relationship between their own and borrowed sources of the organization's liabilities. The financial sustainability of the Organization is formed in the process of all its production and economic activities and is one of the main components of the overall sustainability of the enterprise.
Analysis object is the financial state of a commercial bank, which in economic literature is usually reduced to the financial sustainability or reliability of the credit institution. The stability of the bank is its ability to confront possible negative factors of the internal and external environment.
Financial analysis as science is exploring financial relations expressed in categories of finance and financial indicators. At the same time, its role in managing a commercial bank is that it is an independent management function, financial management tool and the method of its assessment.
In banking practice there are two main approaches to the assessment of the activities of commercial banks: based on determining the rating and analysis of the coefficient system. To determine sustainability, and most often reliability, a variety of methods of drawing up bank ratings are used. Among the state rating systems for assessing the sustainability of banks, the Camel system was widely known in Russia and abroad, and among remote ratings used in recent years in Russia, and amende of the Banking Information Agency "Economics and Life", Kommersant-Daily newspapers .
A more objective assessment of the activities of banks is a comprehensive study of the financial sustainability of commercial banks based on the methods of analyzing individual indicators achieved in their speaker. To assess the financial stability of banks, evaluation in development is necessary, in comparison with what happened to them earlier, how stable their indicators, which is not in the ratings.
Traditionally, the assessment of the Bank's financial stability involves the use of a certain set of indicators, which in our case can be grouped as follows:
- Capital adequacy indicators;
- Liquidity indicators;
- Indicators characterizing the quality of liabilities;
- Indicators characterizing the quality of assets;
- Profitability indicators.
In practice, a sufficiently large number of coefficients are used to evaluate these indicators. Therefore, the task of choosing from the existing set of coefficients of only those that have the greatest impact on the financial stability of the Bank. The choice of coefficients should not be based on the subjective judgments of analysts, but to establish strict dependence on these factors of the financial condition of banks. Therefore, without trying to invent new coefficients for estimating liquidity, profitability, capital adequacy, the quality of liabilities assets, the work carried out the most common in various methods of coefficients for the selected indicators of the stability of banks.
To assess the financial stability of the Organization in practice the following financial sustainability factors are applied:
- The autonomy coefficient (financial independence).
This coefficient characterizes the dependence of the organization from external loans. The lower the value of this coefficient, the more loans from the organization and the higher the risk of insolvency. This coefficient is calculated by the formula:
Ka \u003d own capital / balance currency
It is believed that the normal minimum value of the autonomy coefficient should be 0.5. This restriction means that all the organization's commitments can be covered at the expense of own funds of the organization. The implementation of the specified restriction is very important for current and potential lenders of the organization. The growth of the autonomy coefficient in time indicates an increase in financial independence and, as a result, increases the guarantee of repayment by the organization of its obligations.
- Capital adequacy ratio
This coefficient shows how much the investment of the bank into risky assets is protected by their own capital.
The procedure for calculating this coefficient has the following form:
(Capital / assets weighted with risk) * 100%
- Resource Base Stability Coefficient
Calculated by the formula
((Total liabilities - demand obligations) / total liabilities) * 100%
The norm is this coefficient of 70%
The stability of the bank resources directly determines its ability to place its funds into the most profitable assets and, accordingly, receive profits on them. It follows that the qualitative improvement of the structure of the deposit base should be held in the direction of increasing the share of less expensive tools - urgent deposits supporting the liquidity of the balance, with a decrease in the share of expensive interbank loans and cheap, but completely unpredictable in their behavior in the time of demand for demand.
- The coefficient of maneuverability. This coefficient shows which part of the organization's own funds is in mobile form, which allows them to relatively freely dispose of them. This coefficient is calculated by the formula:
Km \u003d sos / own capital \u003d (own capital - non-current assets) / own capital
- Property ratio of production purposes. This coefficient allows you to assess the structure of the organization's funds. It is calculated by the formula:
Cyprov \u003d (main production facilities + capital investments + intangible assets + stocks) / balance currency.
The following values \u200b\u200bof this coefficient are considered normal: Kip 0.5. If the value of this indicator descends below the recommended minimum, it is advisable to consider the issue of attracting long-term borrowed funds to increase the property of production purposes, if it is not possible to carry out this increase at your own expense
- Asset use efficiency coefficient.
Calculated as follows:
(Income-making assets / total assets) * 100%
The amount of revenue assets should be sufficient for the break-even work of the bank. Normal is considered if the share of revenue assets is at least 65%, or below, but provided that the bank's income exceeds its costs.
The low level of this indicator (below 65%) may indicate a predominance in the structure of the investments of commercial banks of non-working assets, where the main share today is occupied by the balances of the correspondent accounts. This fact should be considered ambiguous, that is, both positive and negative: the stability of banks from the point of view of liquidity increases, but the stability is reduced, since the level of profitability is quite low. In addition, the low value of this coefficient can talk about non-compliance with banks to properly its main function - meeting the needs of the economy and the population in credit resources.
- Quality Quality Coefficient
It has the following formula:
((Loan debt - settlement RVPS) / loan debt) * 100%
When assessing the credit activities of banks, the qualitative characteristic of the bank's loan portfolio is important. For this purpose, the quality of loan debt is calculated, which shows the level of risk-free investments in lending (excluding the size of the calculated RVPS) in the total amount of loan debt. This coefficient determines the degree of qualification of approaches when managing the bank's credit portfolio to preserve a sustainable position. The optimal level of the quality of loan debt is 99%. The more this indicator, the better the quality of the credit portfolio of the commercial bank.
- The coefficient of coating interest. This ratio characterizes the degree of security of creditors from the non-payment of interest for the loan provided and show how many times during the reporting period the organization has earned funds for paying interest on loans. This indicator also makes it possible to determine the permissible level of income reduction used to pay interest.
This coefficient is calculated by the formula:
PPP \u003d Profit before taxes and interest. Pinds / interest on loans.
- The coefficient of accumulation of equity capital. This coefficient characterizes the share of earned profits sent to the development of the main activity. This coefficient is calculated by the formula:
KNSK \u003d (reserve capital + retained earnings) / own capital
During events on the analysis of financial sustainability in the banking sector, the following is required: flows of funds and resources that affect the relevant work of the Bank with the greatest efficiency and effect in the form of profits.
For income in percentage ratio, respectively, on all available types of loans, which are issued for use and coupon papers of high value costs, and additionally to this additional funds and investments in:
- the form of dividends according to shares and discount promissory billings;
- the form of various kinds of volatile cost of bills, bonds and other securities;
- the form of the payment of the required number of interest to attract the resources of various values;
- the form of new resources, over the involvement of which therapy work of the banking institution is necessary;
- the form of quotations, which lead to a long-term change in the estimated value of cash expressed in securities, which is caused by the requirements for their necessary implementation and punctuality in the implementation of the obligations taken or sending the money supply and transferring it to non-cash forms of payments and calculations.
The main step, in accordance with which the size of the durability of each specific considered, is determined, is to conduct analytical work in combination with comprehensive marketing research of the banking environment as a whole.
Analysis of the Bank's financial stability is an ambiguously interconnected concept. It is logical to focus on understanding the financial analysis as on activities to overcome the information disproportion between external users and insiders of the bank.
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