Determining the Fair Value of Credit as a Guarantee of Its Profitability
Journal Title: Бізнес Інформ - Year 2016, Vol 9, Issue
Abstract
The article is aimed at finding ways and learning from the experience of Western European and American banks as to establishing fair prices for the crediting service. It has been determined that, as a result of deregulation of the banking sector, which is the case in many countries, and of a corresponding increase in competition the margin of banking profits from deposits and credits has been significantly reduced. The correct setting of the interest rate on credits becomes even more urgent. Ukraine still doesn’t have a full-fledged market for credits. This is primarily because of the fact that many companies that need credit resources are virtually insolvent. When using existing methods to assess the creditworthiness of borrowers on the part of banks, is considered that most of them have high levels of debt due to non-payment. Thus, some of the variants for determining interest rates while crediting companies and organizations are discussed. The method that gives banks greater yield at the lowest basic rate, as well as solid justification for bringing to the attention of customer equity in those or other components of the fees, have been identified.
Authors and Affiliations
Artur Hniedkov, Yuliana Puzatkova
Keywords
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