Methodological approaches to assessing of the banking risks transparency
Journal Title: Економіка: реалії часу - Year 2016, Vol 1, Issue 23
Abstract
Taking into consideration the increasing of the financial and commodity markets architecture complexity, the constant development of globalization processes and the concentration of banking capital, the most relevant and those causing research interest is the problem of transparency of banks in general and their risks in particular. It has still not developed a unified approach to assessment of the banks’ risks transparency level despite the increased attention of Supervisory authorities to this issue. So, the purpose of this article is to develop a comprehensive methodology for assessing the transparency of banks’ risks with regard to national requirements and international recommendations regarding the disclosure of information by banks about the risks of their activities. It has been made the critical analysis of existing approaches to assessment of the banks’ transparency level according to the methodologies proposed by research institutes, international and national rating agencies with identifying the advantages and disadvantages of each of them. On the basis of the conducted analysis it has been developed a complex methodology involving the calculation of the integral index of banks’ risks transparency, which allows to: assess the current level of disclosure of the information about risks by domestic banks and the dynamics of its changes, including comparative analysis with the transparency of the risks of international banks; develop the system of measures aimed to achieve the greater transparency of the risks of domestic banks through the development of special programs and modification of national legislation in this sphere; evaluate the link between the transparency of banks’ risks and rates of return, riskiness and financial stability.
Authors and Affiliations
Kateryna Busko
Keywords
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