Graduate papers
Description of the graduate paper
Form of studies Master
Title of the study programm Business Finance
Title in original language Basel III prasību ieviešanas efektivitāte Uzbekistānas banku sektorā
Title in English Effectivness of Basel III Requirements in Uzbekistan Banking Sector
Author Davron Bakhodirov
Department Foreign Students Department
Scientific advisor Nataļja Lāce
Reviewer Nadežda Semjonova
Abstract Due to higher capital requirements, Uzbekistan banks were suffering from losing capability of lending as well as profitability problems. The topicality of the study is involved by the necessity of adjustment in implementing the regulatory rules in Uzbekistan banking industry and if there is need, to develop proper concepts and additions. Based on this, some controversies and arguments need to be determined. This is why, research questions will be answered at the end of the thesis critically and supportively as per the Basel III requirements. The research questions are: • How and to what extent the higher capital requirements impact on interest rates on loans? • How and to what extent the profitability of banks will be influenced? • What factors are significant to impact on bank performance? This study seeks to investigate the effectiveness, as a research subject, which may commit potential errors in financial institutions. As a research object within which the study is conducting the research will be Uzbekistan banking industry. The core aim of this study is to address potential benefits of higher capital requirements and identifying the extent of impact on interest rates on loans and profitability of banks in Uzbekistan banking industry. The objectives of the study are to identify the contribution of the new requirements to banks stability, to analyze how efficiently Uzbekistan banks are conducting the requirements, to assess the influence of explanatory factors on interest rate and profitability of banks. One novelty of this study is to examine not only bank related internal factors, but also external factors such as macroeconomic and industry specific variables. Further, the researcher has studied about effectiveness of Basel III requirements towards profitability of Uzbekistan banks since no one has studied about the Uzbekistan context. In the Analytical part the author has gathered all the necessary information and statistics to analyze performances of banks in implementing the requirements in Uzbekistan context. In the theoretical part the author has studied all the relevant theories needed to understand the study areas widely. The theoretical part covers Description of the methods applied by other researchers, the initial data of the conducted research and calculations, the proposed methodology and so on. Further the particular section covers the impact and assessment of higher capital requirements. The Practical part can be considered as the harvest of the study. The author has collected the data from primary sources and from the secondary sources to analyze the results of the study. Further practical part discusses the results to achieve the above mentioned objectives and the recommendations for the long term profitability and stability of Uzbekistan banks. Finally, the author had found that investments to assets, loans to assets and deposits to assets ratios have negatively influenced on loan interest rate. Capital adequacy ratio, liquidity ratio, asset quality ratio and management efficiency ratio have positively influence on the interest rate on loans. The author revealed that liquidity ratio and concentration ratio have negatively influenced on profitability while capital adequacy ratio, asset quality ratio and operating expenses ratio and bank size have positively influenced on the profitability of banks. Based on the conclusions and current economic conditions, author has recommended to eliminate the double tax from foreign investors, properly manage the volume of loans by sector wise, introduce special foreign deposit accounts, effective utilizations of real estates, and concerning the capital adequacy ratios in risk management.
Keywords Basel III, higher capital requirements, loans rates, profitability
Keywords in English Basel III, higher capital requirements, loans rates, profitability
Language eng
Year 2016
Date and time of uploading 26.05.2016 13:36:54