Financial market imbalance: reasons and peculiarities of occurrence in Ukraine

Slav’yuk, Rostyslav; Shkvarchuk, Lyudmyla; Кондрат, Ірина

doi:10.21511/imfi.14(1-1).2017.09

Cited by 15 publications

(7 citation statements)

References 14 publications

(15 reference statements)

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“…Slav'yuk et al emphasized that the main reason of financial market imbalances in Ukraine lies in the fact that financial intermediaries do not perform their functions of transforming the savings into real investments. Their operations have mainly speculative nature, and a high level of risk, and do not impact significantly the dynamics of GDP [Slav'yuk et al 2017].…”

Section: Literature Reviewmentioning

confidence: 99%

Evaluating the Nexus Between Financial Deepening and Economic Growth: Evidence From Ukraine

Кондрат¹,

Kots²

2018

FINANCIAL SCIENCES

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In this paper systemic problems of Ukrainian banking sector are reviewed and the solutions are offered. The main objective of the study is to examine the relationship between a financial deepening and economic growth in Ukraine by estimating several multiple regression models over the 1993 to 2015 period. A real GDP growth per capita was used as an indicator for the economic growth. The domestic credit to private sector (% of GDP) was used as an index of financial depth. The study concludes that financial deepening causes a slight impact on the economic growth of Ukraine. A low level of impact is an indicator of a limitedness of lending to the real economy. This means that banking sector has not become the real driving force of the economic growth in Ukraine yet. The study suggests a statement that policy makers should design the policies which will encourage lending especially high tech production, small and mid-size business, micro financing to the real economy to promote economic growth and increase employment.

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Section: Literature Reviewmentioning

confidence: 99%

Evaluating the Nexus Between Financial Deepening and Economic Growth: Evidence From Ukraine

Кондрат¹,

Kots²

2018

FINANCIAL SCIENCES

Self Cite

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“…On the one hand, many scholars, such as Gerschenkron (1962), Diamond (1984), Stiglitz (1985), Boyd and Prescott (1986), Bencivenga and Smith (1991), Bhide (1993), Stulz (2002), and many others, believed that a bank-centric financial system was superior to a market-centric one. According to this approach, banks perform the function of reducing information asymmetry and solve the problem of interim transaction costs and risks, and therefore have comparative advantages in terms of information collection, valuation of companies and ensuring relationships with companies (Gerschenkron, 1962;Opler, 1993;Rajan & Zingales, 2003, Čihák, Demirgüç-Kunt, Feyen, & Levine, 2012).…”

Section: Literature Reviewmentioning

confidence: 99%

Bank-centric nature of the financial system of Ukraine: analysis of the current situation

Фролов

Shukairi

2020

Banks and Bank Systems

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The formation and functioning of the country’s financial system depend on many factors, both endogenous and exogenous. The economic system of a country, as a higher-order system in relation to the financial one, underlies the development of the financial system model. The existing model of the financial system becomes significant in the context of its impact on economic processes in the country. The main purpose of the empirical analysis is to confirm the thesis about the signs of the bank-centricity of the Ukrainian financial market. The share of assets of financial intermediaries in GDP is determined, which indicates a significant decrease in the share of assets of all financial intermediaries in Ukraine. Analysis of the loan-to-deposit ratio in the banking system of Ukraine shows that the deposit base was far smaller than the size of loans throughout the analyzed period. Analysis of non-performing loans by economic sectors shows that the largest share of NPLs is formed in the corporate sector of the economy. Analysis of the structure of banks’ assets, taking into account their owners, shows that at the end of the analyzed period the share of state-owned banks’ assets increased significantly. Thus, having analyzed the functioning of the banking system of Ukraine, one can conclude about the bank-centric nature of Ukraine’s financial system.

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“…Baur, Hong, and Lee [3] found that Bitcoin, which occupies the largest share of the cryptocurrency market, is mainly used as a speculative tool, and not as an alternative currency. The speculative nature of cryptocurrency would upset the balance in the financial market of Ukraine, the operations on which are aimed more at achieving high investment returns than ensuring GDP growth [4]. The results of empirical studies [3,5] find that cryptocurrency is uncorrelated with traditional asset classes such as stocks, bonds and commodities both in normal times and in periods of financial turmoil, which suggests their suitability for diversification of the investment portfolio with short horizons.…”

Section: Analysis Of Recent Researches and Publicationsmentioning

confidence: 99%

Evaluating Crypto Portfolio Performance

Кондрат¹,

Yaroshevych²,

Lyvdar³

et al. 2020

SEMI

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Cryptocurrency draws a lot of attention from both the academic community and investors, government regulators and the general public. It is not yet fully understood whether it is a type of digital financial asset or a new form of money. The legal status of cryptocurrency varies substantially across countries, and is uncertain in Ukraine. The purpose of the article is to determine the characteristics of cryptocurrency and its legal status in Ukraine, to create well-formed cryptocurrency portfolios with different risk and returns, to evaluate their performance, to explorе portfolio diversification opportunities through cryptocurrencies in new financial reality. There are three features that distinguish cryptocurrency market: high risk due to volatility of returns, fundamental value is unclear, investors are non-institutional. The following key characteristics of cryptocurrency are defined: decentralized and no central authority; anonymous; irreversible and immutable (can not be undone); limited supply and scarcity; the use of a peer-to-peer database; secure; trustless; global; fast. Despite the awareness of state regulators about the opportunities and threats that could be expected from cryptocurrency, the approach may be different due to the country: the absolute prohibition (Nepal, Pakistan, Vietnam, etc.); the neutral status (most countries), cryptocurrency transaction registration and licensing required (Italy, Australia and Japan, etc.), permission to use a cryptocurrency as a mean of payment (Isle of Man, Mexico). Central banks strongly emphasize the distinguish of cryptocurrencies, that are not supported by any official authority, from legal means of payment and financial assets, recognizing the dangers that cryptocurrency investors may face due to its speculative nature. Because cryptocurrencies can potentially be used for illicit activities, tax evasion, legislative acts need to be developed and implemented in Ukraine now. The draft law proposes to consider cryptocurrency as a virtual asset in the form of a token that is generated,accounted for and disposed of in a distributed registry and does not certify the proprietary and/or nonproprietary rights of the cryptocurrency owner. Therefore, cryptocurrency can be seen as an individual asset class suitable for portfolio investing. To justify an investment in cryptocurrencies by non-institutional investors optimal portfolios were constructed using the Markowitz and Quasi-Sharpe models. The calculations showed that cryptocurrency portfolios performed on the basis of the Markowitz model allow to improve the investment returns, but are not sufficiently diversified. A large number of diversified portfolios with different returns and risk were obtained by Quasi-Sharpe model. They offer the highest expected return for a specific level of risk.

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Financial market imbalance: reasons and peculiarities of occurrence in Ukraine

Cited by 15 publications

References 14 publications

Evaluating the Nexus Between Financial Deepening and Economic Growth: Evidence From Ukraine

Evaluating the Nexus Between Financial Deepening and Economic Growth: Evidence From Ukraine

Bank-centric nature of the financial system of Ukraine: analysis of the current situation

Evaluating Crypto Portfolio Performance

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