Competitive position of the bank: assessment by types of activity

Olena Yosypivna Shevtsova, Oleksandra Viacheslavivna Portianova


Abstract


Introduction. General state of the national economy and the level of development of banking system define the types, character, volume and dynamics of the evaluation criteria of their competitive environment. In the conditions of the financial system at the post-crisis stage banking institutions have various competitive characteristics for separate banking service markets. The definition of the essence and methodological approaches to evaluation of certain competitive positions are necessary and timely as for the banks in general so for some of their businesses.

Purpose. The aim of the article is to specify substantial characteristics of the competitive position of a bank and to suggest a methodological approach to definition of quantitative indicators of competitive position on the example of bank activity with bonds and security papers.

Method (methodology). The research has used general scientific and special methods of knowledge: dialectical (in order to deepen the definition of the essence of the competitive position of a bank); method of calculation of an average (to evaluate the cumulative risk of securities portfolio according to their type); factorial analysis (to establish the change of an average profitability level); method of comparison (toevaluate the dynamics of activity of banking sector); matrix method (to present competitive position of a bank related to other banks-competitors in two-dimension space “profitability-risk”).

Results. Competitive position of a bank can be used to evaluate the current state of a bank and as the basis for building its competitive strategy; to define strengths and weaknesses of its activity and of the banks-competitors. Evaluation of the competitive position with the purpose of management has to be arranged according to separate types of banking business, which corresponds to the bank’s position at certain markets of banking services. The examination of the competitive position of a bank according to its activity at securities market helped to find out that optimization of the structure of securities portfolio has to correspond to the general strategy of the bank as for the chosen priorities to “profitability-risk” parameters.


Keywords


market; competitive position; bank; securities portfolio; profitability; risk

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References


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Science Works Journal "Ekonomichnyy analiz"

ISSN 1993-0259 (Print)  ISSN 2219-4649 (Online) DOI: 10.35774/econa


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