Loan Product Policy and Rentability Based on Interest Rates in Czech Republic

Eva Cipovová and Petra Jílková

European Research Studies Journal, 2018, vol. XXI, issue 2, 575-585

Abstract: The Czech banking system is an innovation market driven by the power of new low-cost banks focused on young internet clients. We could say that it is profitable and one the most stable market in Eastern Europe.The purpose of this article is to analyse the effect of the interest rates on the loan product policy of selected banks in the Czech Republic, specifically in connection with the banking products offered to the SME segment.In particular, the final report focusses on measuring bank profitability based on interest rates on different products within a specific time period.Final touch of this article is complemented by a calculation of the additional ROE for the commercial bank using model based on itnerest margin and profitability of provided loans.We found out that the usage of different approaches of internal models with different combinations of key determinants can potentially increase the bank's profitability in the interval from 1,042 mil. to 24,300 mil. CZK.

Keywords: Banking; marketing innovations; financial market; small and medium-sized enterprise. JEL Code: G21; G23; O16. (search for similar items in EconPapers)
Date: 2018
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
https://www.ersj.eu/dmdocuments/44.CEPINOVA_ET_AL_XXI_2_18.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ers:journl:v:xxi:y:2018:i:2:p:575-585

Access Statistics for this article

More articles in European Research Studies Journal from European Research Studies Journal
Bibliographic data for series maintained by Marios Agiomavritis ().