Monetary and financial cash flows as drivers of foreign direct investments at the global level

Radović-Markovič, Mirjana; Vesić, Tamara; Đekić, Marija

doi:10.5937/intrev2202013r

Cited by 2 publications

(2 citation statements)

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“…According to Bouri et al (2020), a financially stable company can operate simpler during recessions because it has enough financial resources and can more easily deal with a drop in market demand. Thus, financial stability may be considered a measure of how well a business can respond to changes not only in the microeconomic (Alamsyah et al, 2022), but also in the macroeconomic environment of the company (Radovic-Markovic et al, 2022;Ha Hong, 2022).…”

Section: Methodsmentioning

confidence: 99%

Has the COVID-19 pandemic affected the corporate financial performance? A case study of Slovak enterprises

Valaskova,

Gajdosikova,

Lazaroiu

2023

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Research background: The corporate debt situation can be considered a crucial factor influencing the future development of the financial performance of the firm. It is essential for every business entity to know its financial health, its strengths and weaknesses, and how its business has been affected by the COVID-19 pandemic and all the changes it has brought. Purpose of the article: The main aim of this paper is to explain and quantify the consequences of the COVID-19 pandemic, analyze changes in the growth of crucial determinants, and identify new trends in Slovak enterprises throughout the monitored period of 2018‒2021. Methods: Hence, a statistically significant difference between the individual indicators due to the period in which the firms achieved these values was determined using the Friedman test. It determined whether the average values of the financial indicators remained constant over the period under review (the years 2018 and 2019 are considered pre- COVID-19 years, while 2020 and 2021 are years when the globe was already being impacted by the outbreak of the COVID-19 pandemic) or whether the individual values of the indicators differed significantly. Findings & value added: Considering that there are statistically significant differences in the indicators of self-financing ratio, current indebtedness ratio, and equity leverage ratio in all monitored periods except for the years 2020 and 2021, where the average values of these debt indicators are the same, the results indicate that the COVID-19 pandemic also negatively impacted the indebtedness of Slovak enterprises. Although this research paper, focusing on the financial performance of the firms in the post-pandemic period, is pioneering in Slovakia, the biggest contribution of the study is the application of the latest information, which could help in more precise monitoring of corporate financial stability and debt policy during the current challenging period. The obtained results provide important universal guidelines for building financial strategies improving long-term financial resilience of enterprises.

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Section: Methodsmentioning

confidence: 99%

Has the COVID-19 pandemic affected the corporate financial performance? A case study of Slovak enterprises

Valaskova,

Gajdosikova,

Lazaroiu

2023

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“…Banks should provide information based on their own rating systems in accordance with minimum standards and good practice guidelines to be issued by the Basel Committee. • Based on the bank's assessment of the probability of default as well as on the estimates of default losses and other potential asset characteristics (which can be assessed either by the supervisor or by the banks) the bank's exposure should be allocated to the capital portfolio [12]. Each bouquet should have an associated degree of risk that includes unexpected loss together with estimates of probability of default and losses given default and if possible other risk characteristics.…”

Section: Term and Characteristics Of The Rating Systemmentioning

confidence: 99%

The role of the banks' rating system in the allocation of loans

Šegrt,

Vučinić,

Mihajlović

et al. 2023

International Review

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The subject of this paper is the analysis of the application of banking internal credit risk measurement models for the purpose of calculating the minimum regulatory capital. The Basel Committee established proposals for an internal rating-based approach (IRB approach-internal rating-based) to capital requirements for credit risk. Such an approach, which relies on the bank's internal assessment of counterparties and exposures, can ensure two key objectives: the first is additional risk sensitivity, in which capital requirements based on internal ratings can be much more sensitive on the drivers of credit risk of economic losses in the banking portfolio; the second is incentive compatibility, where the appropriate structure of the RBI approach can provide a framework that encourages banks to continue to improve their internal risk management practices. The internal ranking approach aims to improve the safety and soundness of the financial system. The paper defines the terminology and classification of the rating system. The probability of default (PD-probability at default) and the other two risk components LGD (loss given default) and EAD (exposure at default) are key input parameters for the calculation of regulatory capital. The rating system is, therefore, a significant driver of risk management and financial performance measurement. To be in a position to demonstrate to supervisors that an internal rating system should be used for the purposes of determining minimum regulatory capital requirements, banks must first demonstrate that the rating system is an integral part of their ongoing operations and risk management culture.

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Monetary and financial cash flows as drivers of foreign direct investments at the global level

Cited by 2 publications

References 24 publications

Has the COVID-19 pandemic affected the corporate financial performance? A case study of Slovak enterprises

Has the COVID-19 pandemic affected the corporate financial performance? A case study of Slovak enterprises

The role of the banks' rating system in the allocation of loans

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