-
Kristi Marinova
Bank Insolvency – Regulatory Challenges and Empirical Evidence
Summary:
Nowadays bank insolvency is a specific field in bank capital management, which requires constant development of the existing regulations and application of new methods and tools for its prevention and early detection. The paper presents a study on bank insolvency in terms of regulato¬ry challenges and empirical evidence for initiation of bankruptcy proceedings against credit institutions. The research thesis is that bank insolvency is a crisis phenomenon in banking practice whose theoretical modelling, regulatory management and empirical investigation require constant improvement of the regulatory framework and supervisory bodies of the central banking institution. The aim of the study was to perform a critical analysis of the evolution of the regulatory framework related to bank insolvency management using empirical evidence from the banking practice in Bulgaria.
-
Bozhidar Bozhinov
Banking Security – Major Manifestations and Aspects
Summary:
The article aims to explore the challenges facing the banking security at the beginning of the new millennium, with a special emphasis on new manifestations of threats to the orderly functioning of the banking institutions. In this aspect, the research thesis that stands out is that threats to banking security reflect changes in the economic, technological and organizational environment in which commercial banks operate.
Banking security is seen as a commitment of the banking institution to ensure safe storage and management of their own assets and their clients' as-sets and the related information, as well as ensure the physical security and safety of clients and employees in the bank offices. The main aspects of banking security are related to provision of physical safety of bank assets, employees and customers; providing information safety of bank assets, as well as the related to management information; providing economic (financial) security of the banking institution.
-
Ivan Marinov
BANKING CONSUMER CREDIT –
A COMPONENT OF THE “RETAIL BANKING” BUSINESS SEGMENT
Summary:
The topic of bank financing of consumption is widely discussed in the studies of a number of researchers in the field of banking. The loans by which banking companies meet the personal needs of individuals and households have long been an integral part of people's lives and have had a significant role in the economies of most countries around the world.
This paper aims to clarify the essential characteristics and specificities of banking consumer credit in Bulgaria. To implement the goal set by the author, the texts of the legal framework on consumer lending in the country are considered, and also the positions of Bulgarian and foreign authors on the definition of the term “consumer credit” and practically applied manifesta-tions of individual types of loans for current purposes, offered by commercial banks in Bulgaria.
-
Daniel Nikolaev
THE IMPACT OF COMMERCIAL BANKS ON CONVERGENCE IN THE EUROPEAN UNION
Summary:
The paper traces the impact of the international, systematically important banks on the state and phenomena observed in the European Union. It comes to the conclusion that international commercial banks further strengthen the convergence in the banking systems of the member states. In the process of disclosure of these relationships, the macroeconomic factors in the European Union have also been analyzed affecting the returns from the main activity of banking institutions aggregated across member states. By sequential use of the regression model and optimization, values representing the local specificities of the individual member-state towards the Union have been reached. Links have been found that suggest a time lag in the effects observed since the crisis in 2008. Both the international banks and the stock market status in the individual member states indicate that international systematically important banks function as a conductor of extreme cross-border phenomena.
-
Sofia Benjakik, Badr Habba
THE RELATIONSHIP BETWEEN CHIEF EXECUTIVE OFFICER DUALITY AND BANK EFFICIENCY: EVIDENCE FROM AFRICAN BANKING SECTOR
Summary:
This paper investigates the relationship between CEO duality (one person serving the role of both Chief Executive Officer and chairman of the board) and bank efficiency using Data Envelopment Analysis (DEA). The present study adds to the existing literature by employing panel data of large commercial banks of Africa from 2016-2019. The paper con¬cludes that CEO duality contributes positively to the bank efficiency of the selected commercial banks in Africa. This finding reveals that dual role has a positive and significant influence towards efficiency in commercial banks.
-
Irina P. Kazandzhieva Yordanova
Too Big to Fail Doctrine and the Financial Safety Net
Summary:
The global financial crisis of 2007-2009 has revealed the negative effects of the TBTF doctrine and the need to take measures to limit government intervention in cases of insolvency of systemically important banks. In the EU, such measures were taken mostly in the supervision of systemically important banks, the capital requirements, the capacity of banks to absorb losses by using domestic resources, and deposit gurantee schemes. The study focuses on the development of a financial safety net. Priority is given to deposit guarantee schemes, which are an essential component of the financial safety net. The evolution of deposit guarantee schemes is studied and an analysis of its impact on the TBTF doctrine is made. The survey has shown that the development of deposit insurance has contradictory effects on the TBTF doctrine.
-
S. Parusheva
CARD-NOT-PRESENT FRAUD – CHALLENGES AND COUNTERACTIONS
Summary:
Due to the rapid development of electronic commerce, the percentage of card-not-present payments over the Internet and fraud related to these, have increased. The relative importance of card-not-present fraud (CNPF) has increased permanently on a global and European scale mainly due to the gradual solution to problems connected with the protection of card-present transactions through the transition to the EMV chip standard and transfer of fraud to more vulnerable card-not-present transactions in which it is difficult to verify the identity of the cardholder in a reliable way. For the protection of card transactions it is necessary to take adequate measures by introducing common harmonized compulsory minimum security requirements across the EU. First, we propose these requirements to include methods for checking the authentication of users. We consider the 3-D Secure Protocol in a version with dynamic authentication the most suitable method because in the EU many steps towards its implementation have already been made. This is of great importance for the systems used by banks and merchants for the prevention of card-not-present fraud and for detecting and blocking of fraudulent transactions.
-
Lyudmil Krystev
A Comparative Analysis of Return on Equity in Bulgarian Public
Companies
Summary:
In practice, there are different criteria for the classification of Bulgarian public companies. Public companies are most commonly ranked according to their market capitalisation and realised turnover (the value amount of transactions with shares in a company). In this article, another criterion for the classification of Bulgarian public companies has been proposed. This criterion is the return reached by the shares of public companies. In the article, a comparative analysis of return on equity in Bulgarian public companies in the insurance and banking sectors has been made.
-
Elena Ralinska
Modeling the Sources of Value in Banks and Valuation Through
the Discounted Cash Flow Method
Summary:
We propose an upgrade, adaptation and implementation of a factor model of historical financial analysis, forecasting and valuation of the banking institution through the method of discounted cash flows based on publicly accessible data, which can be applied in the practice. We research the adequacy and plausibility of the approach, its benefits and drawbacks, as we test it on Unicredit Bulbank Ltd, and we apply a comparative valuation app-roach and accounting reference values of control of the obtained results. The research objective is to upgrade and calibrate the model by introducing rest-rictive conditions for forecasting in compliance with the existing regulatory framework and the observations of the practice. For this purpose, we have also introduced a feasible parametrization and we have brought forth relevant recommendations for forecasting the activity of banking financial institutions.
-
Lyudmil Krystev
Guidelines for Analysing the Financial Statements of Bulgarian Publicly Traded Insurance Companies
Summary:
Financial statements provide information necessary to analyse and assess the financial position of publicly traded companies. Information users include a wide range of entities, such as creditors, suppliers, customers, investors, external control bodies, etc. This paper promotes the thesis that the information disclosed in financial statements helps investors in their decision to invest in the shares of publicly traded companies. A precise analysis of financial statements may result in a decision to purchase, not to purchase, or to sell some of the stocks of the companies which are subject to analysis. The article focuses on publicly traded companies in the insurance sector.
-
Georgi Angelov
A LIQUIDITY ASSESSMENT
OF THE BULGARIAN BANKING SYSTEM (2009–2013)
Summary:
Liquidity is of great significance for the stability of credit institutions and the banking system as a whole. In normal circumstances, the capital adequacy of banks is determined as a key factor for stability. But, during economic crisis, the susceptibility of credit institutions to a shortage of available cash resources in order to cover depositors’ withdrawals is intensified. This directs our attention toward effective liquidity management. Financial cataclysms on a global scale caused by the crisis in the USA during 2007, and the speedy “infection” of the economies of the developed countries showed that gaps in the management of financial institutions can lead to considerable losses on a world-wide scale.
The aim of this study is to assess the liquidity situation of the Bulgarian banking system based on generally accessible (public) information by applying ratio analysis tools. Through the use of key indicators of liquidity assessment, the trends in its development for 2007-2013 are presented. A general assessment of the liquidity situation for banks in Bulgaria is outlined.
-
Bozhidar Bozhinov
Prospects for Early Prognosis of Crisis Situations in the Banking Sector
Summary:
The first global financial and economic crisis of the present century has once again reminded the economists of the vulnerability of the banking system as far as outside shocks are concerned. Problems in the banking sector can be measured in expenses worth billions of Euros in order to support and stabilize most affected countries. In this respect the present article aims at analyzing the options for predicting banking difficulties and problems by means of models focusing on those based on the signal approach. On the basis of a conducted research an attempt has been made to create a mechanism for improvement of the signal-based models for forecasting crisis situations in the banking sector.
-
Lyudmil Krystev
PRACTICAL ASPECTS OF FINANCIAL CONTROLLING IN A COMPANY
Summary:
Financial controlling facilitates the managers of companies in making the right managerial decisions. The process of controlling includes planning, control and analysis. Planning is associated with setting goals and developing planned budgets, control – with detecting deviations from the goals, whereas analysis is associated with disclosing the reasons for these deviations. The information system occupies a central place in financial controlling. It includes a system of indicators; the leading indicator being considered as an objective. The role of information systems in controlling is to link planning activities, control and analysis. This article presents the application of the information system of financial controlling in a particular company – an insurance company operating in the sector of General Insurance.
-
Orlin Yapryakov
RESTRUCTURING AND CONSOLIDATION OF BULGARIAN BANKS – SYSTEM ANALYSIS AND ASSESSMENT
Summary:
In a contemporary market structure, the establishment of a successful and efficient banking system is an issue of high priority. One of the most important factors is maintaining stability in the banking business especially when the country belongs to economic unions comprising certain countries; therefore, destabilization in the national sector might erode the European one. The period of joining the EU has a positive impact on the Bulgarian banking sector, which leads to significant intensity in the restructuring and consolidation of banks in the country during the period 2006–2020. On the basis of this, the banking systems in the country decrease from twenty-nine banks in 2007 to twenty-four in 2020. The undertaken solutions favor the trend in the banking system, which throughout the last years has been sustainable and competitive.
-
Valya Vasileva
Development of Consumer Lending by Non-Bank Credit Companies in Bulgaria
Summary:
The study focuses on consumer loans extended by corporations specializing in lending in Bulgaria during the period March 2008 – September 2018. A brief presentation of the essential features of consumer loans is made and attention is paid to key aspects of statutory regulations of this type of lending in Bulgaria. The main trends in the dynamics of the volume of consumer loans extended by corporations specializing in lending are outlined and their main determinants in the country are worked out. The analysis of non-bank consumer lending is supplemented in a comparative perspective by trends in the dynamics of bank consumer lending. On this basis, the main prospects for growth in the segment of non-bank consumer loans in Bulgaria are presented.
-
Desislava V. Petrovska
STRATEGIC RISK MANAGEMENT
Summary:
The strategic management of commercial companies in times of crisis places a strong emphasis on the management and control of the risk. There is no business activity in the world that is not associated with various types of risk. In a highly competitive and turbulent environment, the clear linking of the business strategy of the firm and its risk management makes it possible to identify and manage the risk of the surrounding environment and the on-going movements within it. Strategic risk management creates a protection value that ensures a sustainable internal environment. This is a continuous process that is embedded in the strategy.
-
Zhelao Vytev
Structural Deviations in Bank Deposits in Bulgaria in Times
of Economic Crisis
Summary:
The article reviews bank deposits in Bulgaria. It specifically analyses how changes in the internal structural components of deposit basis and ratios reflect the general dynamics of bank deposits within the unfavourable economic conditions generated by the economic crisis. Attention is drawn to the structural deviations in bank financing from various aspects, which include sources, maturity, volume and currency structure of deposits on the one hand, and structural deviations of deposits, as determined by bank capital, on the other.
-
Trayan Yosifov
CONDITION OF THE BANK LOAN MARKET IN BULGARIA
Summary:
While not all domestic businesses are growth-oriented, at some stage of their development they need capital to improve their competitiveness and adaptability to changes of their business environment. The access to affordable bank loans is crucial for the development of many Bulgarian businesses, which face increasing external and internal competition. This is due to the fact that there are virtually no alternative sources of financing in our country. The present study aims to present an analysis of the credit market in the country in view of the key importance of bank monetary resource, which is a major factor for strengthening the competitive potential of Bulgarian enterprises. The article presents an analysis of the domestic bank loan market in terms of the key importance of banks’ financial resource, which is a major factor for raising the competitiveness of the Bulgarian enterprises.
-
Petko Angelov
Trends in the Development of Financial Parameters of Banks
in Bulgaria (2008 – 2015)
Summary:
Lending and deposit-taking are key operations to credit institutions. They are of great importance to achieving efficiency in banking. Banking, in turn, should be quantified; a number of factors well-known in banking theory and practice provide the possibility for this. In this respect, the subject of analysis in the study is the profit, profitability, and return of the banks of first and second group in Bulgaria which measure bank efficiency. The purpose of the study is to analyze the bank efficiency for the period 2008 – 2015 on the basis of a ratio analysis and determination of specific values for both groups of banks. As a result of the study, the trends regarding the efficiency of banking in Bulgaria are outlined and the main causes are identified.
