BANKING RISKS IN UKRAINE AND METHODS OF THEIR PREVENTION
Abstract
The banking system of Ukraine is the main component of the financial market, the proper functioning of each element of the banking system has a positive impact on the development of the economy as a whole. In today’s difficult conditions, the instability of global and national financial markets, the problem of ensuring financial adaptability and stability of banks is of great importance. Unfortunately, the activity of banks is impossible without risks. Compared to other types of business activities, the banking sector is characterized by the highest level of risk, which is due to the specifics of banking operations.
In recent years, Ukraine’s banking system has reached a stage of "cleansing". The political and economic crisis, which began in late 2013, worsened the financial condition of domestic banks. Both individual banks and the entire banking system of Ukraine today operate in difficult conditions with high risks. Banking is negatively affected by the low level of the resource base, the predominance of short liabilities, low incomes, and the shadow sector of the economy. Due to the unsatisfactory condition of borrowers, the banking system requires the creation of reserves, which in the absence of relatively stable sources of resources makes it difficult to form the resource base of commercial banks.
Despite the large number of works of scientists, in our opinion, the problem of improving methods of preventing banking risks remains insufficiently disclosed, which is why the chosen topic is relevant and needs further research.
Therefore, one of the most important tasks facing any bank in the world is to identify, assess, monitor, control and manage the bank’s risks. Such tasks should be solved by the banking system of Ukraine for the strategic development of the country and the improvement of all sectors of the economy.
Downloads
References
Bobyl, V. V. (2016). Financial risks of banks: the theory and practice of management in a crisis: monograph. Dnipropetrovsk: eaDNURT. (in Ukrainian)
Demchuk, N. I., & Abakhtimova, A. A. (2017). Bank risk management. Scientific Bulletin of Kherson State University. Series «Economic Sciences», 24, 1, 117‒119.
Potijko, Ju. (2014). A theory and practice of management of risks different kinds is in commercial bank. Visnyk NBU, 4, 58–62. (in Ukrainian)
Hrynynh, V. (2016). Analysis of bank risks. The system of corporate governance assessment and management of financial risk. Moscow: Ves’ myr. (in Russian)
Schiozer, R. F., Mourad, F. A., & Vilarins, R. S. (2018). Bank risk, bank bailouts and sovereign capacity during a financial crisis: A cross-country analysis. Journal of Credit Risk, 14(4), 69–96. doi: https://doi.org/10.21314/JCR.2018.246.
Altunbaş, Y., Thornton, J., & Uymaz, Y. (2021). Money laundering and bank risk: Evidence from U.S. banks. International Journal of Finance and Economics, 26(4), 4879‒4894. doi: https://doi.org/10.1002/ijfe.2044.
Kazbekova, K., Adambekova, A., Baimukhanova, S., Kenges, G., & Bokhaev, D. (2020). Bank risk management in the conditions of financial system instability. Entrepreneurship and Sustainability Issues, 7(4), 3269‒3285. doi: https://doi.org/10.9770/jesi.2020.7.4(46).
Rose, P. (2014). Banking Management. Moscow: Delo LTD. (in Russian)
Volkov, D. P. (2016). The analyze of banking risks: the main approaches to the definition. Ekonomichni nauky. Cer.: Oblik i finansy, 10(3). Retrieved from: http://nbuv.gov.ua/j-pdf/ecnof_2016_10(3)__23.pdf. (in Ukrainian)
Kovalenko, V. V. (Ed.). (2017). The system of risk management in banks: theoretical and methodological aspects: Monograph. Odesa: ONEU. (in Ukrainian)
Prymostka, L. O. (2017). 11. Banking risk management. Kyiv: KNEU. (in Ukrainian)
Burns, R. (n.d.). Economic Capital and Assessment of Capital Adequaci. Retrieved from: https://www.fdic.gov/economic.
Frost, S. M. (2006). Banking Analyst's Desk Book: Money, Risks and Professional Techniques. Dnipropetrovs’k: Balans Biznes Buks. (in Ukrainian)
Constancio, V. (2020). Macroprudential policy in Europe: ensuring financial stability in a banking unio. Financial Stability Conference in Berlin. Retrieved from https://www.ecb.europa.eu/press/key/date/2015/ /html/sp151028.en.html.
Dokument Bazel’s’koho komitetu z pytan’ bankivs’koho nahlyadu «Osnovni pryntsypy efektyvnoho bankivs’koho nahlyadu». (2007). Retrieved from: http://www.bank.gov.ua/ /Bank_supervision/index. (in Ukrainian)
Doroshenko, N. (2021). Bringing the Standards of Ukrainian Banking Legislation to EU Standards. Retrieved from: https://www.atlantis-press.com/proceedings/bambel-21/125960335. (in Ukrainian)
Modeling Credit Risk for Commercial Loans. (2001). FRBSF Economic Letter. Retrieved from: https://www.frbsf.org/publications/economics/letter.
Lobanov, A. A., & Chuhunov, A. V. (2003). Encyclopedia of financial risk management. Moscow: Al’pina pablisher.
Berezutskyi, V. V., Adamenko, M. I. (2016). Hazardous risks and reliability: Tutorial. Kharkiv: FOP Panov A. M. (in Ukrainian)
Hohlov, N. V. (2013). Risk-menegement: Textbook. Moskow: Junyty-Dana. (in Russian)
Demchik, I. (2014). Menegement of kredit risk. Management of bank, 8, 5. (in Ukrainian)
Praet, P. (n.d.). Economic, financial and monetary stability in Europe: reinforcing our policy instruments. Retrieved from https://www.bis.org/events/conf110623/praet.pdf.
The Group of Thirty. (2019). Enhancing Financial Stability and Resilience: Macroprudential Policy, Tools, and Systems for the Future. Retrieved from http://group30.org/images/ /uploads/publications/G30_EnhancingFinancialStabilityResilience.pdf.
Shtefan, L. B. (2015). Problems of management a credit risk in the commercial bank of Ukraine Management of bank, 3, 14-19. (in Ukrainian)
Myshalchenko, Y. V. (2016). The Risks in International Bank Activity, Bukhhalteryia y banky, 3, 17-23. (in Russian)
Barakhtian, N. V. (2020). Reforming banking legislation: main trends and obstacles. Legal scientific electronic journal. Retrieved from: http://lsej.org.ua/5_2017/16.pdf.
Kawai, M., & Morgan, P. J. (2019). Central Banking for Financial Stability in Asia. Retrieved from https://www.adb.org/sites/default/files/publication/156232/adbi-wp377.pdf.
The Brookings Institution. (2020). Financial stability in the broader mandate for central banks: apolitical economy perspective. Retrieved from https://www.brookings.edu/wpcontent/uploads/ /2016/06/14_financial_stability_central_banks.pdf.
