Measuring banking sector development

Size: px
Start display at page:

Download "Measuring banking sector development"

Transcription

1 Financial Sector Indicators Note: 1 Part of a series illustrating how the (FSDI) project enhances the assessment of financial sectors by expanding the measurement dimensions beyond size to cover access, efficiency and stability. Data on these dimensions, as well as other information relevant for financial sector assessment, is intended to become available online during Spring 26. Measuring banking sector development Traditional measures of size and depth of banking systems limit assessment New measure on access to banking, efficiency and stability enhance the analyses Conventional measures of banking sector The traditional indicators utilized for assessing the size, depth and development of a country s banking (financial) sector are: The ratio of M2 to GDP The ratio of private credit to GDP. In particular, both these measures have been used to show the causal effects of financial development on economic growth. However, both measures have some limitations: The ratio of M2 to GDP captures the degree of monetization in the system, but does not capture the degree of bank intermediation. The ratio of private credit to GDP does not control for non-performing loans and more generally, the quality of credit allocation. Both measures do not capture the broad access to bank finance by individuals and firms, the quality of bank services and the efficiency of providing banking services. In general, the quality and availability of indicators on financial stability is limited and the documentation of institutional framework supporting banking lacks robustness. for banking Traditional New Size Access Size Broad access Deposit money bank assets to GDP Branch and ATM density Central bank assets to GDP Average loan and deposit size M2 to GDP Loan & deposit accounts per capita Deposits to GDP Household access Intermediation % of people with bank account Private credit to GDP Firm access Private credit to total credit Collateral needed for loan Private credit to deposits % of firms with financing constraints Efficiency Size of banking sector Percent of GDP Percent Profitability Return on assets 1.5 Net interest margin NPL/Total Loans 12 Private Efficiency credit/ GDP Operating costs Lending spread Days to clear check Competitiveness Concentration ratio Ownership Stability Capital adequacy Capital adequacy ratio High-income: Developing Asset quality OECD countries (a) Lenders NPL refers to non-performing loans. Non-performing loans Real credit growth Loan concentration Large loan exposures to capital (b) Borrowers Firm leverage Interest coverage ratio Household debt to GDP Liquidity Liquid asset ratio Other Net FX position-to-capital Default probability of banks New indicators for going beyond the size The (FSDI) project has compiled indicators that go beyond size, and can help assess access, efficiency and stability of financial systems across and within countries. Banking systems can score very differently on each of these four dimensions. It is therefore important to consider these dimensions jointly and in various combinations. The conventionally used, as well as new indicators relevant for assessment of banking system are summarized in the table above. The page 1

2 indicators within each dimension are also summarized in a composite index for the purposes of benchmarking and classifying countries. The majority of the new indicators refer to access to finance. These indicators summarize the ability of households and firms in a country to access finance and the actual usage of banking services. New indicators on efficiency include the number of days it takes to clear a check or to do a wire transfer in a country, a new measure of the degree of bank competition, and information on the degree of state or foreign ownership of banks. New indicators on the stability of the banking sector, among others, comprise market-based measures of the probability of default of banks in a country, and data on the quality and performance of corporate sector and household borrowers, thus incorporating the user side of finance. In addition, the stability dimension includes some of the new financial stability indicators collected by the IMF, such as information on large loan exposures and concentration of lending activity. The FSDI also comprises data on the development of other parts of the financial sector, such as capital markets and insurance, thus capturing the relationships between the banking and various other sectors. There are also new indicators on the quality of the legal infrastructure that supports bank finance, such as creditor rights, bankruptcy framework, credit information, and bank regulation and supervision. Number of bank accounts per person This measure is an indicator of the use of banking services. Based on a questionnaire circulated among bank regulatory agencies and publicly available data, information on the number and value of deposits for 54 countries for the year 24 was collected. A higher number of bank accounts is interpreted as a signal of greater use of services. This is the first compilation and analysis of consistent and comparable cross-country data on the outreach or penetration of banking systems. Access limited in low-income countries Utilizing information from new indicators, it becomes clear that while the difference between the high-income and developing countries is relatively less pronounced in terms of size and depth, it is quite stark in terms of access. Using the traditional measure of financial development, private credit to GDP, the difference between the rich and poor countries is comparatively less pronounced. The ratio of private credit to GDP varies from 15 percent in low income countries to 95 percent in high income countries, or in other words a 6-fold difference. However, access to finance varies widely across countries, both in terms of high versus low-income and within developing countries themselves. The number of bank accounts per person in highincome countries is on average 2.2, compared to an average of.1 in low-income countries, or a 22-fold difference. In Madagascar, only 14 out of 1 people have a bank account, while in Austria; on average people have more than 3 bank accounts. Such a comparison, otherwise restricted without information on bank accounts, suggests that access to finance is particularly curtailed in low income countries. Private credit and number of deposits accounts, 24 Percent Units Private credit to GDP Developing countries Highincome Lowincome Number of accounts per person Lower Upper Middle-income page 2

3 Classification of countries by number of bank deposits Number of deposits per 1, people Bottom 5 countries Madagascar 14 Bolivia 41 Uganda 47 Kenya 7 Nicaragua 96 Top 5 countries Austria 312 Belgium 38 Denmark 276 Malta 2496 Greece 2418 Bank branches and ATMs Bank branches ATMs (per 1,) (per 1,) Bottom-5 Bottom-5 Ethiopia.4 Bangladesh.1 Uganda.5 Nepal.1 Tanzania.6 Tanzania.2 Madagascar.7 Madagascar.2 Honduras.7 Pakistan.5 Top-5 Top-5 Portugal 52 Portugal 19 Italy 52 Japan 114 Belgium 53 United States 121 Austria 54 Spain 127 Spain 96 Canada 135 The limited access to bank finance is also highlighted in the relationship between traditional measures of size (or depth and development) and other new data on access to banking. The chart (top) shows the relationship between M2/ GDP (a traditional measure of financial depth) and the number of bank accounts (deposits) per person, which is a proxy for the use of banking services. The data on bank accounts are collected using a extensive survey of bank regulatory agencies. The data show that, especially at intermediate levels of financial development, financial size and access to banking are not correlated. This illustrates the importance of comparing data on access to finance when assessing financial development in countries. Concentration does not imply low efficiency For the bank efficiency dimension, FSDI includes not only traditional measures of bank profitability (e.g. return on assets) and efficiency (e.g. ratio of operating costs to assets) but also information on the structure of banking system and measures of the competitiveness of the banking systems (e.g. percentage of banks assets that are foreign or state-owned, or the three-bank concentration ratio). Financial depth and access Number of deposit accounts per capita Depth and access not correlated at intermediate level of financial development R 2 = M2/GDP (%) Concentration is not correlated with efficiency Operating costs to total assets bank asset concentration ratio (%) page 3

4 The general notion is that a more concentrated banking sector is less efficient. However, the chart (bottom, previous page) below shows that the three-bank asset concentration is not correlated with the ratio of operating cost to assets, a traditional measure of efficiency. This suggests that one should not focus solely on concentration ratios as a measure for competition when making inferences about the efficiency of the banking sector. But less depth does indicate less efficiency Financial depth and efficiency, on the other hand, appear more closely correlated. The chart (top) shows the ratio of M2/GDP (financial depth) against the ratio of average operating costs-to-total assets, a traditional measure of bank operating efficiency. The figure shows quite clearly that countries with less deep banking systems also have less efficient banks. Banking and corporate vulnerabilities For the stability dimension of the financial sector, FSDI covers not only traditional CAMEL-type indicators using banks balance sheets, but also indicators based on the balance sheets of corporate borrowers. The combination of banking and corporate sector indicators provides a more comprehensive picture of the health of the banking sector. The chart (bottom) shows that firms financial leverage, measured as the ratio of corporate debt-to-equity, is positively correlated with the banks share of non-performing loans in the banking sector. This illustrates the relationship between the vulnerability of the corporate sector and the quality of banking sector assets. Legal rights facilitate intermediation Finally, FSDI contains detailed information about the legal and regulatory infrastructure for the banking sectors, including creditor rights and supervisory rules and practices. The main variables for this set of information are presented in table below. Legal protection of credi- More efficient banking systems exhibit greater depth M2/GDP (%) Corporate leverage and bank non-performing loans Non-performing loans to total loans (%) R 2 = Operating costs to Total assets CAMEL Indicators The acronym "CAMEL" refers to the five components of a bank's condition that are assessed: Capital adequacy, Asset quality, Management, Earnings, and Liquidity. These aspects reflect the variation in bank asset risk and leverage, because they capture the market, credit, operational, and liquidity risk faced by banks. R 2 = Corporate Debt to Equity Capital (%) tor rights features as an important determinant of bank lending. The chart (next page) shows the strong correlation between private credit-to- GDP, a measure of financial intermediation, against an index of legal rights that measures the degree to which collateral and bankruptcy laws facilitate lending. page 4

5 Legal rights index This index, reflecting the legal rights of borrowers and lenders, measures the degree to which collateral and bankruptcy laws facilitate lending. It is based on data collected through study of collateral and insolvency laws, supported by the responses to the survey on secured transactions laws. The index includes 3 aspects related to legal rights in bankruptcy and 7 aspects found in collateral law. A score of 1 is assigned for each of the following features of the laws: Secured creditors are able to seize their collateral when a debtor enters reorganization there is no automatic stay or asset freeze imposed by the court. Secured creditors, rather than other parties such as government or workers, are paid first out of the proceeds from liquidating a bankrupt firm. Management does not stay during reorganization. An administrator is responsible for managing the business during reorganization. General, rather than specific, description of assets is permitted in collateral agreements. General, rather than specific, description of debt is permitted in collateral agreements. Any legal or natural person may grant or take security in the property. A unified registry that includes charges over movable property operates. Secured creditors have priority outside of bankruptcy. Parties may agree on enforcement procedures by contract. Creditors may both seize and sell collateral out of court. The index ranges from to 1, with higher scores indicating that collateral and bankruptcy laws are better designed to expand access to credit. Intermediation correlated with creditor's legal rights Private credit to GDP (%) R 2 = Legal Rights Index Select references Beck, T., Demigurc-Kunt, A., and Martinez Peria, S. (25). Reaching out: Access to and use of banking services across countries. Claessens, S., and Laeven, L. (25). What Drives Bank Competition? Some International Evidence, Journal of Money, Credit, and Banking 36(3), Djankov, S., McLiesh, C., and Shleifer, A. (25). Private Credit in 129 Countries, Department of Economics, Harvard University. Levine, R. (24). Finance and Growth: Theory and Evidence. forthcoming in Philippe Aghion and Steven Durlauf, eds. Handbook of Economic Growth. The Netherlands: Elsevier Science. Infrastructure and regulations Creditor rights Legal protection of creditor rights Cost to complete bankruptcy (% of estate) Cost to resolve disputes (% of debt value) Credit information sharing Cost of registering property (% of property value) Supervision and regulation Activity and ownership restrictions Bank entry restrictions Capital stringency Official supervisory action Official supervisory resources Independence of supervisory authority Availability of information through the FSDI Web site Data on traditional, as well as new indicators for assessment of banking sectors will all become available through the FSDI interactive Web site, currently under construction. Such indicators, along with various other variables, would form part of an overall framework for assessing financial sectors that would be available online. Provision of regional and country details in the Web site will offer users the flexibility of customizing information to their unique requirement. page 5

INSOLVENCY LAWS AROUND ANALYSIS AND RULES FOR THEIR DESIGN THE WORLD A STATISTICAL STIJN CLAESSENS* AND LEORA KLAPPER** Forum

INSOLVENCY LAWS AROUND ANALYSIS AND RULES FOR THEIR DESIGN THE WORLD A STATISTICAL STIJN CLAESSENS* AND LEORA KLAPPER** Forum Forum features can be a way to shed light on the importance of particular creditor rights. INSOLVENCY LAWS AROUND THE WORLD A STATISTICAL ANALYSIS AND RULES FOR THEIR DESIGN Insolvency around the world

More information

Thierry Tressel Lead Economist, Research Group, World Bank 2015 High Level Caribbean Forum, Sept. 3-4 2015, St. Kitts

Thierry Tressel Lead Economist, Research Group, World Bank 2015 High Level Caribbean Forum, Sept. 3-4 2015, St. Kitts Thierry Tressel Lead Economist, Research Group, World Bank 215 High Level Caribbean Forum, Sept. 3-4 215, St. Kitts Policy issue Focus on SMEs: they are the biggest contributors to employment across countries,

More information

Acknowledgments Executive Summary

Acknowledgments Executive Summary Foreword p. xiii Acknowledgments p. xv Executive Summary p. xix Abbreviations p. lix Currency Equivalents p. lxxii Assessing Access p. 1 Growth, Poverty Reduction, and Access to Financial Services p. 1

More information

Banking Services for Everyone? Barriers to Bank Access and Use Around the World

Banking Services for Everyone? Barriers to Bank Access and Use Around the World Banking Services for Everyone? Barriers to Bank Access and Use Around the World Thorsten Beck, Asli Demirguc-Kunt and Maria Soledad Martinez Peria * First draft: October 2006 This draft: February 2007

More information

BANK-BASED AND MARKET-BASED FINANCIAL SYSTEMS: CROSS-COUNTRY COMPARISONS. Asli Demirguc-Kunt and Ross Levine*

BANK-BASED AND MARKET-BASED FINANCIAL SYSTEMS: CROSS-COUNTRY COMPARISONS. Asli Demirguc-Kunt and Ross Levine* BANK-BASED AND MARKET-BASED FINANCIAL SYSTEMS: CROSS-COUNTRY COMPARISONS Asli Demirguc-Kunt and Ross Levine* June 1999 * Development Research Group, The World Bank, and Finance Department, University of

More information

THE EARLY WARNING SYSTEM PRESENTATION DEFINITION

THE EARLY WARNING SYSTEM PRESENTATION DEFINITION THE EARLY WARNING SYSTEM PRESENTED BY: PETER GATERE MANGER, BANK SUPERVISION CENTRAL BANK OF KENYA 1 PRESENTATION Definition Background Objectives of an early warning system Role of qualitative information

More information

The Determinants of Global Factoring By Leora Klapper

The Determinants of Global Factoring By Leora Klapper The Determinants of Global Factoring By Leora Klapper Factoring services can be traced historically to Roman times. Closer to our own era, factors arose in England as early as the thirteenth century, as

More information

Prudential definition of assets: micro and macro prudential perspective

Prudential definition of assets: micro and macro prudential perspective Prudential definition of assets: micro and macro prudential perspective Santiago de Chile November 2015 Presented by Salome Skhirtladze Authors: Giorgi Kadagidze, Otar Nadaraia, Salome Skhirtladze, Vakhtang

More information

Chart I.1. Difference between Primary Surplus (PS) and Bond Yield Spreads in Selected EU 1 Countries

Chart I.1. Difference between Primary Surplus (PS) and Bond Yield Spreads in Selected EU 1 Countries LIST OF CHARTS Chart I.1. Difference between Primary Surplus (PS) and Bond Yield Spreads in Selected EU 1 Countries Chart I.2. Gross Debt Stock and Budget Deficits of Selected Countries as of 2010 1 Chart

More information

CREDIT BUREAUS AND FINANCIAL CO-OPERATIVES: TIME TO JOIN THE BANDWAGON?

CREDIT BUREAUS AND FINANCIAL CO-OPERATIVES: TIME TO JOIN THE BANDWAGON? CREDIT BUREAUS AND FINANCIAL CO-OPERATIVES: TIME TO JOIN THE BANDWAGON? Agenda Introduction Role of credit bureaus Definition of a credit bureau Solving the challenge of asymmetric information Contributors

More information

Getting credit WHO REFORMED IN GETTING CREDIT IN 2011/12?

Getting credit WHO REFORMED IN GETTING CREDIT IN 2011/12? 72 Getting credit Malaysia, South Africa and the remain tied at the top of the ranking on the ease of getting credit. Between June 2011 and June 2012 Doing Business recorded 5 reforms strengthening legal

More information

SURVEY OF INVESTMENT REGULATION OF PENSION FUNDS. OECD Secretariat

SURVEY OF INVESTMENT REGULATION OF PENSION FUNDS. OECD Secretariat SURVEY OF INVESTMENT REGULATION OF PENSION FUNDS OECD Secretariat Methodological issues The information collected concerns all forms of quantitative portfolio restrictions applied to pension funds in OECD

More information

BANK INTEREST RATES ON NEW LOANS TO NON-FINANCIAL CORPORATIONS ONE FIRST LOOK AT A NEW SET OF MICRO DATA*

BANK INTEREST RATES ON NEW LOANS TO NON-FINANCIAL CORPORATIONS ONE FIRST LOOK AT A NEW SET OF MICRO DATA* BANK INTEREST RATES ON NEW LOANS TO NON-FINANCIAL CORPORATIONS ONE FIRST LOOK AT A NEW SET OF MICRO DATA* Carlos Santos** 127 Articles Abstract This note aims at contributing to the assessment of the empirical

More information

CROSS-COUNTRY HETEROGENEITY IN MFI INTEREST RATES ON LOANS TO NON-FINANCIAL CORPORATIONS IN THE EURO AREA

CROSS-COUNTRY HETEROGENEITY IN MFI INTEREST RATES ON LOANS TO NON-FINANCIAL CORPORATIONS IN THE EURO AREA Box 2 CROSS-COUNTRY HETEROGENEITY IN MFI INTEREST RATES ON LOANS TO NON-FINANCIAL CORPORATIONS IN THE EURO AREA The dynamics of bank lending rates on loans to non- corporations (NFCs) have been highly

More information

TITLE 5 BANKING DELAWARE ADMINISTRATIVE CODE

TITLE 5 BANKING DELAWARE ADMINISTRATIVE CODE TITLE 5 BANKING 900 Regulations Governing Business of Banks and Trust Companies 1 905 Loan Limitations: Credit Exposure to Derivative Transactions 1.0 Purpose This regulation sets forth the rules for calculating

More information

FSB invites feedback on residential mortgage underwriting practices

FSB invites feedback on residential mortgage underwriting practices Press release Press enquiries: Basel +41 76 350 8430 Press.service@bis.org Ref no: 38/2010 20 September 2010 FSB invites feedback on residential mortgage underwriting practices The Financial Stability

More information

Small and medium-size enterprises

Small and medium-size enterprises Doing Business 2015 Going Beyond Efficiency Getting credit The importance of registries Small and medium-size enterprises account for the largest share of employment in the developing world. They are also

More information

NPL resolution in progress: the Hungarian experience Gergely Fábián

NPL resolution in progress: the Hungarian experience Gergely Fábián NPL resolution in progress: the Hungarian experience Gergely Fábián Vienna Initiative 2: NPL Resolution in emerging Europe: Taking Stock and Next Steps 26 June 215 29Q1 21Q1 211Q1 212Q1 213Q1 214Q1 215Q1

More information

Disclosure 17 OffV (Credit Risk Mitigation Techniques)

Disclosure 17 OffV (Credit Risk Mitigation Techniques) Disclosure 17 OffV (Credit Risk Mitigation Techniques) The Austrian Financial Market Authority (FMA) and the Oesterreichsiche Nationalbank (OeNB) have assessed UniCredit Bank Austria AG for the use of

More information

Banking Services for Everyone? Barriers to Bank Access and Use around the World. Thorsten Beck, Asli Demirguc-Kunt and Maria Soledad Martinez Peria *

Banking Services for Everyone? Barriers to Bank Access and Use around the World. Thorsten Beck, Asli Demirguc-Kunt and Maria Soledad Martinez Peria * Public Disclosure Authorized Banking Services for Everyone? Barriers to Bank Access and Use around the World WPS4079 Thorsten Beck, Asli Demirguc-Kunt and Maria Soledad Martinez Peria * Public Disclosure

More information

Credit Scoring of SME Using Credit Information Database. Satoshi Kuwahara CRD Association, Japan July, 2015

Credit Scoring of SME Using Credit Information Database. Satoshi Kuwahara CRD Association, Japan July, 2015 Credit Scoring of SME Using Credit Information Database Satoshi Kuwahara CRD Association, Japan July, 2015 1. What is CRD? 2. Background of CRD Establishment 3. Credit Bureau & Credit Database 4. Concrete

More information

EASTERN CARIBBEAN CENTRAL BANK

EASTERN CARIBBEAN CENTRAL BANK EASTERN CARIBBEAN CENTRAL BANK GUIDELINES ON CREDIT RISK MANAGEMENT FOR INSTITUTIONS LICENSED TO CONDUCT BANKING BUSINESS UNDER THE BANKING ACT Prepared by the BANK SUPERVISION DEPARTMENT May 2009 TABLE

More information

EXTERNAL DEBT AND LIABILITIES OF INDUSTRIAL COUNTRIES. Mark Rider. Research Discussion Paper 9405. November 1994. Economic Research Department

EXTERNAL DEBT AND LIABILITIES OF INDUSTRIAL COUNTRIES. Mark Rider. Research Discussion Paper 9405. November 1994. Economic Research Department EXTERNAL DEBT AND LIABILITIES OF INDUSTRIAL COUNTRIES Mark Rider Research Discussion Paper 9405 November 1994 Economic Research Department Reserve Bank of Australia I would like to thank Sally Banguis

More information

Health Care Systems: Efficiency and Policy Settings

Health Care Systems: Efficiency and Policy Settings Health Care Systems: Efficiency and Policy Settings Summary in English People in OECD countries are healthier than ever before, as shown by longer life expectancy and lower mortality for diseases such

More information

Conducting Monetary Policy with Large Public Debts. Gita Gopinath Harvard University

Conducting Monetary Policy with Large Public Debts. Gita Gopinath Harvard University Conducting Monetary Policy with Large Public Debts Gita Gopinath Harvard University 1 Large Public Debts Net Government debt to GDP Greece 155 Japan 134 Portugal 111 Italy 103 Ireland 102 United States

More information

The Danish mortgage system: Advantages, challenges, and lessons learned

The Danish mortgage system: Advantages, challenges, and lessons learned The Danish mortgage system: Advantages, challenges, and lessons learned 1 ICELAND PRESENTATION JULY 1, 2014 J E S P E R R A N G V I D P R O F E S S O R, C B S C H A I R M A N, D A N I S H F I N A N C I

More information

The recent Asset quality review on non-performing loans conducted by the Bank of Italy: Main features and results

The recent Asset quality review on non-performing loans conducted by the Bank of Italy: Main features and results The recent Asset quality review on non-performing loans conducted by the Bank of Italy: Main features and results 1. Introduction In the last few years the Italian economy has been under considerable strain.

More information

Two trillion and counting

Two trillion and counting Two trillion and counting Assessing the credit gap for micro, small, and medium-size enterprises in the developing world OCTOBER 2010 Peer Stein International Finance Corporation Tony Goland McKinsey &

More information

VII COMMERCIAL PAPER BACKED BY CREDIT CARD RECEIVABLES

VII COMMERCIAL PAPER BACKED BY CREDIT CARD RECEIVABLES VII COMMERCIAL PAPER BACKED BY CREDIT CARD RECEIVABLES INTRODUCTION Asset-backed commercial paper (ABCP) conduits issue short-term notes backed by trade receivables, credit card receivables, or medium-term

More information

A voluntary bankruptcy under the BIA commences when a debtor files an assignment in bankruptcy with the Office of the Superintendent of Bankruptcy.

A voluntary bankruptcy under the BIA commences when a debtor files an assignment in bankruptcy with the Office of the Superintendent of Bankruptcy. Bankruptcy and Restructuring 121 BANKRUPTCY AND RESTRUCTURING Under Canadian constitutional law, the federal government has exclusive legislative control over bankruptcy and insolvency matters. Insolvency

More information

Article 56 of the Bank of Russia Law.

Article 56 of the Bank of Russia Law. As of October 1, 2015 No. Commentary Relevant laws and regulations 1. Duties and powers of banking supervision 1.1 Banking supervisory Bank of Russia Articles 4 and 56 of authority Federal Law No. 86-FZ,

More information

How Bankers Think. Build a sound financial base to support your company for future growth

How Bankers Think. Build a sound financial base to support your company for future growth How Bankers Think Build a sound financial base to support your company for future growth Presented by: Lisa Chapman Business Planning, Social Media Marketing & SEO 615-477-8412 Questions to Consider First

More information

Capital adequacy ratios for banks - simplified explanation and

Capital adequacy ratios for banks - simplified explanation and Page 1 of 9 Capital adequacy ratios for banks - simplified explanation and example of calculation Summary Capital adequacy ratios are a measure of the amount of a bank's capital expressed as a percentage

More information

RISK FACTORS AND RISK MANAGEMENT

RISK FACTORS AND RISK MANAGEMENT Bangkok Bank Public Company Limited 044 RISK FACTORS AND RISK MANAGEMENT Bangkok Bank recognizes that effective risk management is fundamental to good banking practice. Accordingly, the Bank has established

More information

Athens University of Economics and Business

Athens University of Economics and Business Athens University of Economics and Business MSc in International Shipping, Finance and Management Corporate Finance George Leledakis An Overview of Corporate Financing Topics Covered Corporate Structure

More information

THE BASICS OF CHAPTER 11 BANKRUPTCY

THE BASICS OF CHAPTER 11 BANKRUPTCY THE BASICS OF CHAPTER 11 BANKRUPTCY Bankruptcy is a legal proceeding in which a debtor declares an inability to pay consumer or business debts as they become due. Debtors may seek to be excused from continuing

More information

Ⅲ Key Legal, Tax and Accounting Considerations in Real Estate Securitization

Ⅲ Key Legal, Tax and Accounting Considerations in Real Estate Securitization This capital is most commonly comprised of shares and equity-like securities (investment securities issued by investment corporations, specific investments and preferred equity securities of TMKs, etc.)

More information

Bank of Ghana Monetary Policy Report. Financial Stability Report

Bank of Ghana Monetary Policy Report. Financial Stability Report BANK OF GHANA E S T. 1 9 5 7 Bank of Ghana Monetary Policy Report Financial Stability Report Volume 5: No.1/2013 February 2013 5.0 Introduction Conditions in global financial markets have improved significantly

More information

Greece. From: OECD Banking Statistics: Methodological Country Notes 2010

Greece. From: OECD Banking Statistics: Methodological Country Notes 2010 From: OECD Banking Statistics: Methodological Country Notes 2010 Access the complete publication at: http://dx.doi.org/10.1787/9789264089907-en Greece Please cite this chapter as: OECD (2011), Greece,

More information

Credit Analysis. A comprehensive e-learning product covering ratio analysis and cash flow analysis. After completing this course, you will be able to:

Credit Analysis. A comprehensive e-learning product covering ratio analysis and cash flow analysis. After completing this course, you will be able to: e-learning and reference solutions for the global finance professional Credit Analysis A comprehensive e-learning product covering ratio analysis and cash flow analysis After completing this course, you

More information

IMPACT OF LIBERALISING FINANCIAL SERVICES

IMPACT OF LIBERALISING FINANCIAL SERVICES IMPACT OF LIBERALISING FINANCIAL SERVICES January 22 This brief reviews the evidence for the impact of liberalising markets for financial services. It begins by showing the increasing economic importance

More information

Director s Guide to Credit

Director s Guide to Credit Federal Reserve Bank of Atlanta Director s Guide to Credit This guide was created by the Supervision and Regulation Division of the Federal Reserve Bank of Atlanta, 1000 Peachtree Street NE, Atlanta,

More information

Key matters in examining Liquidity Risk Management at Large Complex Financial Groups

Key matters in examining Liquidity Risk Management at Large Complex Financial Groups Key matters in examining Liquidity Risk Management at Large Complex Financial Groups (1) Governance of liquidity risk management Senior management of a large complex financial group (hereinafter referred

More information

Recent measures for refinancing and restructuring Spain s corporate debt: Opportunities and impact on the banking sector

Recent measures for refinancing and restructuring Spain s corporate debt: Opportunities and impact on the banking sector Recent measures for refinancing and restructuring Spain s corporate debt: Opportunities and impact on the banking sector María Romero and Itziar Sola 1 The high level of Spain s private debt, particularly

More information

General Government debt: a quick way to improve comparability

General Government debt: a quick way to improve comparability General Government debt: a quick way to improve comparability DEMBIERMONT Christian* BIS Bank for International Settlements, Basel, Switzerland Christian.Dembiermont@bis.org In simple words the General

More information

Residential Mortgage Finance and Housing Markets in Russia February 9, 2004. Britt Gwinner The World Bank

Residential Mortgage Finance and Housing Markets in Russia February 9, 2004. Britt Gwinner The World Bank Residential Mortgage Finance and Housing Markets in Russia February 9, 2004 Britt Gwinner The World Bank 1 Overview of Presentation Two Sections: 1. Residential Mortgage Finance Internationally 2. Mortgage

More information

A Banker s Quick Reference Guide to CRA

A Banker s Quick Reference Guide to CRA Federal Reserve Bank of Dallas A Banker s Quick Reference Guide to CRA As amended effective September 1, 2005 This publication is a guide to the CRA regulation and examination procedures. It is intended

More information

NPL resolution: a macro view

NPL resolution: a macro view NPL resolution: a macro view Gergely Fábián MNB-EBRD workshop on debt Restructuring and NPL Resolution in Hungary 3 March 215 29Q1 21Q1 211Q1 212Q1 213Q1 214Q1 High corporate NPL has been a problem for

More information

Discussion Board Articles Ratio Analysis

Discussion Board Articles Ratio Analysis Excellence in Financial Management Discussion Board Articles Ratio Analysis Written by: Matt H. Evans, CPA, CMA, CFM All articles can be viewed on the internet at www.exinfm.com/board Ratio Analysis Cash

More information

As of July 1, 2013. Risk Management and Administration

As of July 1, 2013. Risk Management and Administration Risk Management Risk Control The ORIX Group allocates management resources by taking into account Group-wide risk preference based on management strategies and the strategy of individual business units.

More information

Financial market integration and economic growth: Quantifying the effects, Brussels 19/02/2003

Financial market integration and economic growth: Quantifying the effects, Brussels 19/02/2003 Financial market integration and economic growth: Quantifying the effects, Brussels 19/02/2003 Presentation of «Quantification of the Macro-Economic Impact of Integration of EU Financial Markets» by London

More information

Consumer Over-indebtedness and Financial Vulnerability: Evidence from Credit Bureau Data

Consumer Over-indebtedness and Financial Vulnerability: Evidence from Credit Bureau Data KDI International Conference on Household Debt from an International Perspective: Issues and Policy Directions Consumer Over-indebtedness and Financial Vulnerability: Evidence from Credit Bureau Data By

More information

Rating Methodology by Sector. Life Insurance

Rating Methodology by Sector. Life Insurance Last Updated: March 26, 2012 Rating Methodology by Sector Life Insurance *This rating methodology is a modification of the rating methodology made public on July 13, 2011, and modifications are made to

More information

Good afternoon everyone and thanks to the Trans-Tasman Business Circle for inviting me to speak today.

Good afternoon everyone and thanks to the Trans-Tasman Business Circle for inviting me to speak today. Peter King, CFO Westpac Group Trans-Tasman Business Circle 3 September 2015 Capital: The next chapter INTRODUCTION Good afternoon everyone and thanks to the Trans-Tasman Business Circle for inviting me

More information

Developing Credit Reporting in Africa: Opportunities and Challenges

Developing Credit Reporting in Africa: Opportunities and Challenges African Finance for the 21 st Century High-Level Seminar organized by the IMF Institute in collaboration with the Joint Africa Institute Tunis, Tunisia, March 4 5, 2008 Session VI: Designing Context-Specific

More information

Introduction1. Sample Description. Drivers of Costs and the Empirical Approach or Explanatory Variables:

Introduction1. Sample Description. Drivers of Costs and the Empirical Approach or Explanatory Variables: Efficiency Drivers of Microfinance Institutions (MFIs): The Case of Operating Costs 1 Adrian Gonzalez, Researcher, MIX (agonzalez@themix.org) The findings, interpretations, and conclusions expressed in

More information

EBA-GL-2015-02. 23 July 2015. Guidelines. on the minimum list of qualitative and quantitative recovery plan indicators

EBA-GL-2015-02. 23 July 2015. Guidelines. on the minimum list of qualitative and quantitative recovery plan indicators EBA-GL-2015-02 23 July 2015 Guidelines on the minimum list of qualitative and quantitative recovery plan indicators Contents EBA Guidelines on the minimum list of qualitative and quantitative recovery

More information

Deposit Insurance Pricing. Luc Laeven World Bank Global Dialogue 2002

Deposit Insurance Pricing. Luc Laeven World Bank Global Dialogue 2002 Deposit Insurance Pricing Luc Laeven World Bank Global Dialogue 2002 1 Introduction Explicit deposit insurance should not be adopted in countries with a weak institutional environment Political economy

More information

Insurance corporations and pension funds in OECD countries

Insurance corporations and pension funds in OECD countries Insurance corporations and pension funds in OECD countries Massimo COLETTA (Bank of Italy) Belén ZINNI (OECD) UNECE, Expert Group on National Accounts, Geneva - 3 May 2012 Outline Motivations Insurance

More information

Public Sector Debt - Instructions

Public Sector Debt - Instructions Public Sector Debt - Instructions Under the auspices of the Task Force on Finance Statistics 1 the World Bank has developed a new database to disseminate quarterly data on government, and more broadly,

More information

Basel II, Pillar 3 Disclosure for Sun Life Financial Trust Inc.

Basel II, Pillar 3 Disclosure for Sun Life Financial Trust Inc. Basel II, Pillar 3 Disclosure for Sun Life Financial Trust Inc. Introduction Basel II is an international framework on capital that applies to deposit taking institutions in many countries, including Canada.

More information

Doing Business measures 2 types of institutions and systems that can facilitate access to finance and improve its allocation:

Doing Business measures 2 types of institutions and systems that can facilitate access to finance and improve its allocation: Page 1 of 18 Getting Credit This topic explores two sets of issues credit information registries and the effectiveness of collateral and bankruptcy laws in facilitating lending. The most recent round of

More information

STUDY OF CORRELATION BETWEEN AVERAGE INTEREST RATE AND NON-PERFORMING LOANS IN THE ROMANIAN BANKING SYSTEM DURING 2006- FEBRUARY 2010

STUDY OF CORRELATION BETWEEN AVERAGE INTEREST RATE AND NON-PERFORMING LOANS IN THE ROMANIAN BANKING SYSTEM DURING 2006- FEBRUARY 2010 STUDY OF CORRELATION BETWEEN AVERAGE INTEREST RATE AND NON-PERFORMING LOANS IN THE ROMANIAN BANKING SYSTEM DURING 006- FEBRUARY 010 Socol Adela 1 Decembrie 1918 University of Alba Iulia Faculty of Science

More information

CREDIT RISK MANAGEMENT IN INDIAN COMMERCIAL BANKS

CREDIT RISK MANAGEMENT IN INDIAN COMMERCIAL BANKS CREDIT RISK MANAGEMENT IN INDIAN COMMERCIAL BANKS MS. ASHA SINGH RESEARCH SCHOLAR, MEWAR UNIVERSITY, CHITTORGARH, RAJASTHAN. ABSTRACT Risk is inherent part of bank s business. Effective risk management

More information

The Approach of the Banking Regulator

The Approach of the Banking Regulator Surveillance of Mortgage Credit The Approach of the Banking Regulator Workshop on Real Estate t Prices and Financial Stability 25th April 2014 Central Bank of Chile Eric Parrado Chairman Superintendency

More information

Course Syllabus For Banking and Financial Management Department

Course Syllabus For Banking and Financial Management Department For Banking and Financial Management Department School Year First Year First year Second year Third year Fifth year Fifth year Fifth year Fifth year Name of course Financial Accounting principles Intermediate

More information

SUGGESTED AMENDMENTS. Bankruptcy and Insolvency Act

SUGGESTED AMENDMENTS. Bankruptcy and Insolvency Act SUGGESTED AMENDMENTS Bankruptcy and Insolvency Act The underlined words are our suggested language: BIA section 65.1 (7), (8) and (9) 65.1 (1) If a notice of intention or a proposal has been filed in respect

More information

On the Determinants of Household Debt Maturity Choice

On the Determinants of Household Debt Maturity Choice On the Determinants of Household Debt Maturity Choice by Wolfgang Breuer*, Thorsten Hens #, Astrid Juliane Salzmann +, and Mei Wang Abstract. This paper jointly analyzes a traditional and a behavioral

More information

Funds Transfer Pricing A gateway to enhanced business performance

Funds Transfer Pricing A gateway to enhanced business performance Funds Transfer Pricing A gateway to enhanced business performance Jean-Philippe Peters Partner Governance, Risk & Compliance Deloitte Luxembourg Arnaud Duchesne Senior Manager Governance, Risk & Compliance

More information

ENTREPRENEURSHIP MARKETS

ENTREPRENEURSHIP MARKETS STUDIES IN & ENTREPRENEURSHIP MARKETS Number 6 / January 2008 Bank Lending and Entrepreneurial Finance The Performance of Canadian Banks John Chant with Keith Godin Contents. Executive summary.... 3. Introduction...

More information

RECENT TRENDS IN SME AND ENTREPRENEURSHIP FINANCE

RECENT TRENDS IN SME AND ENTREPRENEURSHIP FINANCE RECENT TRENDS IN SME AND ENTREPRENEURSHIP FINANCE This chapter analyses trends in SME and entrepreneurship finance over 2007-2011, based on data collected for the country Scoreboards and information from

More information

When Kodak filed for bankruptcy

When Kodak filed for bankruptcy Doing Business 2016 Resolving insolvency New funding and business survival When Kodak filed for bankruptcy in January 2012, few were surprised. The company had dominated the U.S. photographic film industry

More information

FINANCIAL ANALYSIS CS. Sample Reports. version 2008.x.x

FINANCIAL ANALYSIS CS. Sample Reports. version 2008.x.x FINANCIAL ANALYSIS CS Sample Reports version 2008.x.x TL 19887 (10/14/2008) Copyright Information Text copyright 2004-2008 by Thomson Reuters/Tax & Accounting. All rights reserved. Video display images

More information

Guideline. Commercial Lending Criteria. No: E-2 Date: June 1992

Guideline. Commercial Lending Criteria. No: E-2 Date: June 1992 Canada Bureau du surintendant des institutions financières Canada 255 Albert Street 255, rue Albert Ottawa, Canada Ottawa, Canada K1A 0H2 K1A 0H2 Guideline Subject: No: E-2 Date: June 1992 This guideline

More information

REGULATION ON MORTGAGE LENDING PROCESS

REGULATION ON MORTGAGE LENDING PROCESS UNOFFICIAL TRANSLATION Appendix to the Resolution No 446, of the Governor of the Bank of Mongolia, dated October 17, 2008 REGULATION ON MORTGAGE LENDING PROCESS CONTENTS One. GENERAL PROVISION 1. Purpose

More information

Resolving Insolvency. What is Measured?

Resolving Insolvency. What is Measured? 1 Resolving Insolvency This topic identifies weaknesses in existing bankruptcy law and the main procedural and administrative bottlenecks in the bankruptcy process. The most recent round of data collection

More information

Saudi mortgage laws A formula for a wellfunctioning

Saudi mortgage laws A formula for a wellfunctioning Saudi mortgage laws A formula for a wellfunctioning market? Introduction and background Over the last five years the Government of Saudi Arabia has continued to invest considerable amounts of oil revenue

More information

Final Assessment 1 of Spain's eligibility for an EFSF/ESM loan to recapitalize certain financial institutions

Final Assessment 1 of Spain's eligibility for an EFSF/ESM loan to recapitalize certain financial institutions Final Assessment 1 of Spain's eligibility for an EFSF/ESM loan to recapitalize certain financial institutions Background On 25 June 2012, the Spanish Government applied for external financial assistance

More information

Patrick M. Avitabile Managing Director Citibank, N.A. 111 Wall Street New York, New York 10005

Patrick M. Avitabile Managing Director Citibank, N.A. 111 Wall Street New York, New York 10005 SECURITIES LENDING AND INVESTOR PROTECTION CONCERNS: CASH COLLATERAL REINVESTMENT; BORROWER DEFAULT; LENDING AGENT COMPENSATION AND FEE SPLITS; AND PROXY VOTING Patrick M. Avitabile Managing Director Citibank,

More information

1. Perception of the Bancruptcy System... 2. 2. Perception of In-court Reorganisation... 4

1. Perception of the Bancruptcy System... 2. 2. Perception of In-court Reorganisation... 4 Bankruptcy Systems and In-court Reorganisation of Firms, 2010 Content: 1. Perception of the Bancruptcy System... 2 2. Perception of In-court Reorganisation... 4 3. Perception of Creditor Committees, Fast

More information

Access to Financial Services in Developing Countries: Identification of Obstacles. Liliana Rojas-Suárez July 2006

Access to Financial Services in Developing Countries: Identification of Obstacles. Liliana Rojas-Suárez July 2006 Access to Financial Services in Developing Countries: Identification of Obstacles Liliana Rojas-Suárez July 2006 Background Even though banks are the most important providers of financial services Evolution

More information

FINANCIAL STABILITY ISSUES FOR SMALL STATES. Mirko Mallia Assistant Executive Financial Stability Surveillance, Assessment and Data

FINANCIAL STABILITY ISSUES FOR SMALL STATES. Mirko Mallia Assistant Executive Financial Stability Surveillance, Assessment and Data FINANCIAL STABILITY ISSUES FOR SMALL STATES Mirko Mallia Assistant Executive Financial Stability Surveillance, Assessment and Data Disclaimer: Any views expressed are only the author s s own and do not

More information

5. Aggregation and Consolidation of Data

5. Aggregation and Consolidation of Data 5. Aggregation and Consolidation of Data Introduction 5.1 The analysis of FSI ratios is affected by the extent to which the data used for their calculation are consolidated. Thus, when constructing FSI

More information

SME Banking-Africa. A Unique Opportunity for the Continent

SME Banking-Africa. A Unique Opportunity for the Continent SME Banking-Africa A Unique Opportunity for the Continent Key Messages More to be done The opportunity Challenges in SME financing Profitable segment A proposed solution 2 SMEs in Africa- The Missing Middle

More information

4. FINANCIAL POSITION AND RISK EXPOSURE OF HOUSEHOLDS AND BUSINESSES

4. FINANCIAL POSITION AND RISK EXPOSURE OF HOUSEHOLDS AND BUSINESSES 4. FINANCIAL POSITION AND RISK EXPOSURE OF HOUSEHOLDS AND BUSINESSES In 215 H1, households remained oriented towards savings, as shown by the expansion in deposits level. Lending to households expanded

More information

Q4. How should institutions determine if they may exclude asset-based loans (ABL) from their definition of leveraged loans?

Q4. How should institutions determine if they may exclude asset-based loans (ABL) from their definition of leveraged loans? Board of Governors of the Federal Reserve System Federal Deposit Insurance Corporation Office of the Comptroller of the Currency Frequently Asked Questions (FAQ) for Implementing March 2013 Interagency

More information

Judicial performance and its determinants: a cross-country perspective

Judicial performance and its determinants: a cross-country perspective No. 05 JUNE 2013 Judicial performance and its determinants: a cross-country perspective A GOING FOR GROWTH REPORT Box 1. Description of the data The data used in this study come primarily from three

More information

DECISION On Minimum Standards for Risks Management in Micro-Credit Financial Institutions. 1. General Provision. Subject matter

DECISION On Minimum Standards for Risks Management in Micro-Credit Financial Institutions. 1. General Provision. Subject matter Pursuant to Article 17, paragraph 1, point 2 of the Central Bank of Montenegro Law (OGRM 52/00, 47/01) and Article 157, paragraph 2 of the Banking Law (OGRM 17/08), the Council of the Central Bank of Montenegro,

More information

Development aid stable in 2014 but flows to poorest countries still falling. Detailed summary

Development aid stable in 2014 but flows to poorest countries still falling. Detailed summary OECD - Paris, 8 April 2015 Development aid stable in 2014 but flows to poorest countries still falling Key aid totals in 2014 Detailed summary In 2014, net official development assistance (ODA) flows from

More information

Creditor Rights, Enforcement, and Bank Loans

Creditor Rights, Enforcement, and Bank Loans THE JOURNAL OF FINANCE VOL. LXIV, NO. 2 APRIL 2009 Creditor Rights, Enforcement, and Bank Loans KEE-HONG BAE and VIDHAN K. GOYAL ABSTRACT We examine whether differences in legal protection affect the size,

More information

FOURTEEN. Access to Financing for Small and Medium Enterprises CHAPTER STYLIZED FACTS

FOURTEEN. Access to Financing for Small and Medium Enterprises CHAPTER STYLIZED FACTS CHAPTER FOURTEEN Access to Financing for Small and Medium Enterprises I N Latin America and around the world, small and medium enterprises (SMEs) comprise a large share of firms, employment, and gross

More information

BASLE CAPITAL ACCORD: TREATMENT OF POTENTIAL EXPOSURE FOR OFF-BALANCE-SHEET ITEMS

BASLE CAPITAL ACCORD: TREATMENT OF POTENTIAL EXPOSURE FOR OFF-BALANCE-SHEET ITEMS BASLE CAPITAL ACCORD: TREATMENT OF POTENTIAL EXPOSURE FOR OFF-BALANCE-SHEET ITEMS Basle Committee on Banking Supervision Basle April 1995 The treatment of potential exposure for off-balance-sheet items

More information

Factoring, reverse factoring and other tools for access to finance. Ivor Istuk. Friday, 22 November 2013

Factoring, reverse factoring and other tools for access to finance. Ivor Istuk. Friday, 22 November 2013 Factoring, reverse factoring and other tools for access to finance Ivor Istuk Friday, 22 November 2013 OUTLINE Outline of presentation 1. Problem of late payments 2. Factoring good mitigation tool Defining

More information

Policy Statement on Prudent Commercial Real Estate Loan Workouts (October 30, 2009)

Policy Statement on Prudent Commercial Real Estate Loan Workouts (October 30, 2009) Policy Statement on Prudent Commercial Real Estate Loan Workouts (October 30, 2009) The financial regulators 1 recognize that financial institutions face significant challenges when working with commercial

More information

Policy Statement on Prudent Commercial Real Estate Loan Workouts

Policy Statement on Prudent Commercial Real Estate Loan Workouts Policy Statement on Prudent Commercial Real Estate Loan Workouts The financial regulators 1 recognize that financial institutions face significant challenges when working with commercial real estate (CRE)

More information

2013 Annual Results. D. Francisco Gómez Martín CEO. Madrid, January 31 st, 2014

2013 Annual Results. D. Francisco Gómez Martín CEO. Madrid, January 31 st, 2014 2013 Annual Results D. Francisco Gómez Martín CEO Madrid, January 31 st, 2014 Disclaimer This presentation has been prepared by Banco Popular Español solely for purposes of information. It may contain

More information

Central Credit Registers (CCRs) as a Multi Purpose Tool to close Data Gaps

Central Credit Registers (CCRs) as a Multi Purpose Tool to close Data Gaps Central Credit Registers (CCRs) as a Multi Purpose Tool to close Data Gaps Michael Ritter Deutsche Bundesbank Chair of the ESCB Working Group on Credit Registers Mexico City, May 2014 AGENDA I. General

More information

4 Distribution of Income, Earnings and Wealth

4 Distribution of Income, Earnings and Wealth 4 Distribution of Income, Earnings and Wealth Indicator 4.1 Indicator 4.2a Indicator 4.2b Indicator 4.3a Indicator 4.3b Indicator 4.4 Indicator 4.5a Indicator 4.5b Indicator 4.6 Indicator 4.7 Income per

More information

Federal Reserve Bank of Atlanta. Components of a Sound Credit Risk Management Program

Federal Reserve Bank of Atlanta. Components of a Sound Credit Risk Management Program Federal Reserve Bank of Atlanta Components of a Sound Credit Risk Management Program LOAN POLICY The loan policy is the foundation for maintaining sound asset quality because it outlines the organization

More information

Chapter Five. Aggregation and Consolidation of Data

Chapter Five. Aggregation and Consolidation of Data - 80 - Chapter Five Aggregation and Consolidation of Data Introduction 5.1 The analysis of FSI ratios is affected by the extent to which the data used for their calculation are consolidated. Thus, when

More information