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Money and credit - Ivanov V.M.

22.2. The structure of the modern credit system

The modern credit system, which is the main element of the market for loan capital, consists of the following institutional units or levels.

1. The central bank, state and semi-state banks .

2. Banking sector :

• commercial banks;

• savings banks;

• investment banks;

• mortgage banks;

• specialized trading banks.

3. Insurance sector :

• Insurance companies;

• pension funds.

4. Specialized non-bank financial institutions:

• investment companies;

• financial companies;

• charity funds;

• trust departments of commercial banks;

• loan savings associations;

• credit unions.

Such a system is typical for most industrialized countries - mainly for the USA, Japan, and countries of Western Europe. It is usually called a four- or three-level (in some cases, the insurance sector is combined with the fourth level, which goes under the general name of specialized non-bank financial institutions).

However, according to the degree of development of certain links, individual countries differ significantly from each other. The US credit system is the most developed, therefore, all industrialized countries of the West were guided by it when forming the credit system in the post-war period.

Credit systems of developing countries as a whole, with rare exceptions, are underdeveloped. In most of these countries, there is a two-tier system represented by the central bank and the system of commercial banks.

The main link of the credit system are banks. The combination of various types of banks and banking institutions in their relationship is the banking system - an integral part of the credit system.

Ukraine has developed a two-tier banking system. Its first level is the NBU, the second is banks and banking institutions.

At the beginning of 1995, 228 banks were registered in Ukraine. Many of them had a small capital. So, of all the operating, about 60 banks had capital, which was equal to the cost of an average three-room apartment in Kiev. At the same time, there were banks with significant capital and an extensive network of branches. For example, Ukraine has 535 branches, Ukrsotsbank has 116 branches.

To protect the interests of commercial banks in Ukraine, the Association of Commercial Banks of Ukraine was created, in which on January 1, 1995 there were 120 members. The quantitative composition of commercial banks is given in table. 2.

table 2

The quantitative composition of commercial banks in Ukraine

Number of banks

1994

1995 year

1996 year

1997 year

1998 year

2000 year

2001 year

on the

November 1, 02

By registry

including:

state

acting

liquidated due

with violation

banking

228

2

220

230

2

210

229

2

188

227

2

188

214

2

176

203

2

153

195

2

153

185

2

153

legislation and

for other reasons

thirteen

-

8

10

16

9

dn

9

As can be seen from the data table. 2, the total number of commercial banks in Ukraine during 1994-1997. it was almost unchanged (220-230), and since 1998 their number has decreased to 185, and the number of actually operating ones (licensed by the NBU for transactions) is no more than 153 at the end of 2002. At the same time, there are positive trends in banking system development:

• a radical change in the ownership structure (from the complete monopolization of the state to the system of private banks);

• an increase in the number of banks from 5 (state-owned by type of ownership) in 1990 to 185 in 2002

The structure of the banking system of Ukraine takes on classic features, according to which the upper level - the central bank - is under state control, and the lower level - commercial banks - belong to private individuals.

At the same time, it should be noted that today's net worth of commercial banks reflects their weak capitalization (Table 3).

Table 3

Equity of commercial banks of Ukraine at the end of the year

(in million UAH)

Year

1991

1992

1993

1994

1995

1996

1997

1998

2000

on 01/01/02

Amount

0,057

2

75

441

1865

3659

4166

4200

5275.5

5384.8

The data indicate a low concentration of bank capital, which is manifested in a significant number (80%) of small and medium-sized banks. With the adoption of the new version of the Law of Ukraine "On Banks and Banking Activities" on December 7, 2000, the most serious problem for banks is the level of regulatory capital - 25 million UAH. According to experts of the Association of Ukrainian Banks, from 50 to 100 commercial banks will not be able to "immediately" comply with this standard.

In 2002, five new banks were registered in 10 months (27 banks are in the liquidation phase). According to the NBU, the net assets of banks increased by 25.8% and amount to 59893.1 million UAH. Total assets increased by 25.3% - up to 63652 million UAH. The structure of the loan portfolio is dominated by loans from business entities - 80.9% of the total loans. The share of bad loans decreased from 5.6% at the beginning of the year to 5.1% as of November 1, 2002.

The National Bank of Ukraine is the state bank of the country, which, together with its branches, is the first level of the banking system and acts as a reserve system.

In Ukraine, the credit system is undergoing restructuring in accordance with the needs of a market economy and is likely to continue to change.