BANKING ACTIVITY ON THE UKRAINIAN STOCK MARKET
RUDA Oksana - Candidate of economic sciences, associate professor of department of finance and credit, Vinnytsia national agrarian University (21008, Vinnitsa, 3, Soniachna str., e-mail: firstname.lastname@example.org)
The theoretical bases of realization and development of banking activity in the stock market are generalized. The specifics of the operations of commercial banks in the stock market, as well as the directions of their activities, are considered. Banks in the securities market act as issuers, investors, and professional participants. Bank securities transactions in economically developed countries bring over 30% of revenue and are a priority investment destination. In Ukraine, the portfolio of securities generally has a small, compared to lending, share in the assets of the bank. However, the overall dynamics of securities transactions with banks is positive, they are an important component of diversifying the assets of the bank, a way to form own and replenish borrowed capital, a promising direction for the development of banking activities in general. The analysis of operations of banks with securities was carried out.
The stock market is an important element of the economy of developed countries and an integral part of the financial market of each country. The stock market serves as a sphere of mobilization of financial capital and becomes of special significance. The feature of the development of stock markets in recent decades is the mechanism of globalization and the growth of various financial instruments and institutions.
Due to certain historical and economic circumstances, on the securities market in Ukraine one of the main agents is commercial banks, which are universal enterprises that are able to perform all the variety of financial transactions, including in the stock segment. Securities act as a means to achieve more general objectives of banking. The attempts of banks to expand securities transactions are stimulated, on the one hand, by the high profitability of these operations, on the other hand - a relative reduction in the use of direct bank loans. Therefore, the research of banks activity in the Ukrainian stock market is extremely relevant and needs attention.
At the present stage of market transformations in Ukraine, transactions of banks with securities, in comparison with world practice, are carried out at insufficient level.
The main subjects of the stock market are its direct participants and institutions that provide operations on it. The first includes investors, brokers, dealers, managers. They are the direct participants of the operations and in most cases are responsible for the decisions made.
Banking institutions are leading institutional players in the stock market. The current banking legislation allows domestic commercial banks to carry out a wide range of securities transactions: banks can act as issuers of their own shares, bonds, deposit certificates, bills of exchange and other securities, they can buy securities at their own expense , while pursuing a variety of goals, that is to act as investors. In addition, banks have the right to engage in intermediary transactions with securities, receiving a commission fee for this.
The activity of banks in the securities market is that they carry out operations in this market in accordance with the general rules that apply to all participants in the securities market, but they must also adhere to additional rules set by the National Bank of Ukraine. In conducting transactions in financial markets, the bank must build relationships with clients on the principles of integrity, honesty, completeness of disclosure of necessary information, execution of orders of the client exclusively in his interests.
By investing in the stock market, banks aim at:
- profit from own investments in securities at the expense of interest received by the bank, dividends and growth of exchange rate of securities;
- gaining profit from providing services to clients with transactions in securities;
- expansion of the sphere of influence of the bank and attraction of new clients due to participation in the capital of enterprises and organizations.
The result of the investment operations of the bank is the formation of portfolios of securities of different types.
In general, one can speak of a positive trend in the activity of commercial banks in the securities market. Nevertheless, there are certain negative factors that restrain the process of securities transactions by banks, therefore, there is a need to develop ways to overcome them. Since the main problem is the underdevelopment of the stock market itself, the following tasks need to be addressed: increasing capitalization, liquidity and transparency of the stock market; improvement of market infrastructure and ensuring its reliable and efficient functioning; improvement of the mechanisms of state regulation, supervision on the stock market and protection of investors' rights; stimulation of further development of the stock market of Ukraine.
In the stock market you can distinguish three conditional trends in the activities of a commercial bank: as an issuer, as an investor and as a professional its participant.
An important indicator for the Ukrainian securities market is the achievement of the level of world financial markets, the increase in demand for shares of Ukrainian issuers from foreign funds, as well as the gradual transfer to the stock market of funds from the currency market and the market of bank deposits.
The prospect of further research is an analysis of the dynamic characteristics of the banks' activity in the stock market, since the development of securities transactions may become one of the key elements in ensuring the integration of the Ukrainian banking system into the world economic space.
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