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Business and Economics > Finance: General

You are looking at 1 - 10 of 35 items for :

  • Type: Journal Issue x
  • Serbia, Republic of x
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Cover IMF Staff Country Reports
Republic of Serbia: 2021 Article IV Consultation and Request for a 30-Month Policy Coordination Instrument-Press Release; Staff Report; and Statement by the Executive Director for Republic of Serbia
International Monetary Fund. European Dept.
Recent economic developments. Supported by a large policy package, Serbia’s economy rebounded quickly from the initial COVID-19 shock, recording a 1 percent contraction of real GDP in 2020. Job losses have mostly been contained to the informal sector, thanks to policy measures aimed at preserving formal employment. A supplementary budget for 2021 was adopted in April boosting capital expenditure and extending policy support to households and corporates, against the background of third and fourth waves of infections and related containment measures, as well as a weaker-than-expected economic recovery in key trading partners. Inflation remains low. After rising again in late February, infections tapered, helped by new containment measures and the rapid vaccine rollout.
Keywords:
reform momentum; support package; GDP data; pension indexation rule; inflation expectation; public debt level; policy buffer; SOE reform; production method; COVID-19; Government finance statistics; Loans; Exchange rates; Europe; Global
Cover Regional Economic Outlook, October 2020, Europe
Regional Economic Outlook, October 2020, Europe
Whatever It Takes: Europe’s Response to COVID-19
International Monetary Fund. European Dept.

Abstract

The COVID-19 pandemic has caused dramatic loss of human life and major damage to the European economy, but thanks to an exceptionally strong policy response, potentially devastating outcomes have been avoided.

Keywords:
lockdowns; pandemic; corporate liquidity; recovery; reopening; economic outlook; forecasting; REO; policy support; infection curve; job retention program; Europe transform; financial market disruption; pandemic economy; solvency risks in Europe; time trend; reopening indices; infection incidence; reinfection risk; infection rate; credit access; containment policy; COVID-19; Liquidity; Solvency; Infrastructure; Europe; Global
Cover IMF Working Papers
Monetary Policy Transmission in Emerging Markets and Developing Economies
Mr. Luis Brandao Marques
,
Mr. R. G Gelos
,
Mr. Thomas Harjes
,
Ms. Ratna Sahay
, and
Yi Xue
Central banks in emerging and developing economies (EMDEs) have been modernizing their monetary policy frameworks, often moving toward inflation targeting (IT). However, questions regarding the strength of monetary policy transmission from interest rates to inflation and output have often stalled progress. We conduct a novel empirical analysis using Jordà’s (2005) approach for 40 EMDEs to shed a light on monetary transmission in these countries. We find that interest rate hikes reduce output growth and inflation, once we explicitly account for the behavior of the exchange rate. Having a modern monetary policy framework—adopting IT and independent and transparent central banks—matters more for monetary transmission than financial development.
Keywords:
WP; exchange rate; inflation targeting; interest rate; monetary policy shock; reaction function; monetary policy transmission; exchange rate channel; interest-rate-based monetary policy; interest rate shock; unit monetary policy shock; nominal exchange rate; transmission mechanism; monetary policy rate; dummy variable; IT framework; Financial sector development; Exchange rates; Monetary policy frameworks; Central bank policy rate; Consumer price indexes; Global; Africa; Monetary Policy; Emerging markets; Financial structure; monetary policy framework; monetary policy channel
Cover IMF Staff Country Reports
Republic of Serbia: Third Review under the Policy Coordination Instrument-Press Release; and Staff Report
International Monetary Fund. European Dept.
This paper discusses the Republic of Serbia’s Third Review Under the Policy Coordination Instrument (PCI). Serbia is the second IMF member country to request a PCI and aims to maintain macroeconomic and financial stability, while advancing an ambitious reform agenda to foster rapid growth, job creation and improved living standards. All quantitative targets (QTs) for end-September 2019 were met. Most reform targets (RTs) have been implemented. The IMF Staff recommends completion of the third review under the Policy Coordination Instrument and establishment of end-September 2020 QTs. Fiscal policy is on track so far, however, it will be important to closely monitor 2019 budget implementation to ensure that the deficit stays within the program ceiling. While progress has been made in reforming the tax administration and strengthening public investment management frameworks, delayed reforms of the public wage system and public employment framework need to advance in 2020.
Keywords:
ISCR; CR; inflation band; rate; exchange rate; government bond; current account; FDI inflow; executive board's decision; program implementation; management framework; support medium-term growth; Loans; Capital markets; Exchange rates; Global
Cover IMF Working Papers
Bank Capital and the Cost of Equity
Mohamed Belkhir
,
Samy Ben Naceur
,
Mr. Ralph Chami
, and
Anis Semet
Using a sample of publicly listed banks from 62 countries over the 1991-2017 period, we investigate the impact of capital on banks’ cost of equity. Consistent with the theoretical prediction that more equity in the capital mix leads to a fall in firms’ costs of equity, we find that better capitalized banks enjoy lower equity costs. Our baseline estimations indicate that a 1 percentage point increase in a bank’s equity-to-assets ratio lowers its cost of equity by about 18 basis points. Our results also suggest that the form of capital that investors value the most is sheer equity capital; other forms of capital, such as Tier 2 regulatory capital, are less (or not at all) valued by investors. Additionally, our main finding that capital has a negative effect on banks’ cost of equity holds in both developed and developing countries. The results of this paper provide the missing evidence in the debate on the effects of higher capital requirements on banks’ funding costs.
Keywords:
WP; bank capital; capital requirement; financial risk; capital measure; Cost of equity; Banking regulation; Financial stability; return on equity; bank capitalization; bank cost; capitalized bank; bank capital measure; funding cost; financial leverage decrease; risk profile; Stocks; Capital adequacy requirements; Stock markets; Return on investment; Loan loss provisions; Global
Cover Negative Euro Area Interest Rates and Spillovers on Western Balkan Central Bank Policies and Instruments
Negative Euro Area Interest Rates and Spillovers on Western Balkan Central Bank Policies and Instruments
International Monetary Fund

Abstract

Proceedings of a conference co-hosted by the Bank of Albania and the International Monetary Fund in May 2017.

Keywords:
SEM; interest rate; euro; central bank; rate; bank; interest rate differential; interest rate environment; ECB monetary policy; FX reserve; risk-taking channel; Currencies; Negative interest rates; Financial sector stability; Exchange rates; Central bank policy rate; Global; Europe; Western Europe; Eastern Europe; Baltics; ECB monetary policy implementation framework; International reserves
Cover IMF Staff Country Reports
Montenegro: Financial Sector Assessment Program-Banking Supervision and Regulation-Technical Note
International Monetary Fund. Monetary and Capital Markets Department
This paper discusses the current status of banking supervision and regulation in Montenegro in the context of select Basel Core Principles. It provides a brief overview of the financial system structure, bank system performance, and the framework for financial oversight. Laws, regulations, and supervision have improved significantly since the 2006 Financial Sector Assessment Program to align more closely with Basel and EU requirements. The banking sector dominates the financial system and accounts for about 90 percent of financial system assets, equivalent to about 93 percent of GDP as of June 2015. There are currently 14 banks operating in Montenegro, up from 11 in 2013.
Keywords:
ISCR; CR; central bank; CBM regulation; banking system; bank d; CBM supervisor; holding company; joint stock; liquidity contingency plans; risk management system; CBM state; CBM methodology; CBM analysis; CBM monitoring; CBM contingency plans; Operational risk; Credit risk; Bank risk management; Bank supervision; Stress testing; Eastern Europe; Southern Europe; Global
Cover Staff Discussion Notes
A Strategy for Resolving Europe's Problem Loans
Mr. Shekhar Aiyar
,
Mr. Wolfgang Bergthaler
,
Jose M Garrido
,
Ms. Anna Ilyina
,
Andreas Jobst
,
Mr. Kenneth H Kang
,
Dmitriy Kovtun
,
Ms. Yan Liu
,
Mr. Dermot Monaghan
, and
Ms. Marina Moretti
Europe’s banking system is weighed down by high levels of non-performing loans (NPLs), which are holding down credit growth and economic activity. This discussion note uses a new survey of European country authorities and banks to examine the structural obstacles that discourage banks from addressing their problem loans. A three pillared strategy is advocated to remedy the situation, comprising: (i) tightened supervisory policies, (ii) insolvency reforms, and (iii) the development of distressed debt markets.
Keywords:
SDN; book value; unsecured debt; expected return; profit sharing; NPL ratio; NPL resolution; bank capitalization; area bank; real GDP; bank profitability; capital buffer; Nonperforming loans; Distressed assets; Loans; Solvency; Debt restructuring; Europe; Global
Cover IMF Staff Country Reports
Bosnia and Herzegovina: Financial Sector Assessment Program-Detailed Assessment of Observance of the CPMI-IOSCO Principles for Financial Market Infrastructures
International Monetary Fund. Monetary and Capital Markets Department
This paper discusses key findings and recommendations of the Detailed Assessment of Observance of the CPMI–IOSCO (Committee on Payments and Market Infrastructures–International Organization of Securities Commissions) Principles for Financial Market Infrastructures in Bosnia and Herzegovina. Major achievements have been made in modernizing the payment system. Resiliency of the interbank payment system was demonstrated against the severe floods of May 2014. The currency board arrangement has helped protect the payment system from credit risks. The formal assessment of the real-time gross settlement system suggests that many of the standards are observed. The legal basis is relatively sound, but finality and netting arrangements require greater legal certainty and protection at the law level.
Keywords:
ISCR; CR; RTGS system; CBBH RTGS; central bank; reserve account; RTGS participant; CBBH Management; CBBH instruction; CBBH website; Real time gross settlement systems; Payment systems; Commercial banks; Operational risk; Principles for Financial Market Infrastructures; Global
Cover Policy Papers
Blackout Periods in GRA Arrangements and the Extended Rights to Purchase Policy - A Review
International Monetary Fund
This paper reviews the IMF’s extended rights to purchase (ERP) policy. Established in 2009, the ERP policy extends the continuity of purchase rights during temporary interruptions of access to previously accumulated, but undrawn, balances which occur during periods where data on relevant periodic performance criteria (PCs) is not yet available. This policy specifically provides for access to accumulated but undrawn purchase rights under SBAs and arrangements under the EFF (?extended arrangements?). While enhancing the continuity of a member’s purchase rights, the ERP policy also provides several safeguards aimed at reducing the risk that a member might draw on Fund resources when its Fund-supported program goes off track.
Keywords:
PP; ERP policy; right; purchase right; purchase; policy; blackout Policy review; PC data; ERP mechanism; IMF's extended rights to purchase; Moral hazard