Model of capital risk management in the banking system

Constantin Anghelache, Marian Sfetcu, Doina Avram, Mariana Chiliment and Petre Olteanu
Additional contact information
Constantin Anghelache: Bucharest University of Economic Studies / „Artifex” University of Bucharest
Marian Sfetcu: „Artifex” University of Bucharest
Doina Avram: Bucharest University of Economic Studies
Mariana Chiliment: Bucharest University of Economic Studies
Petre Olteanu: Bucharest University of Economic Studies

Romanian Statistical Review Supplement, 2018, vol. 66, issue 1, 101-110

Abstract: Capital represents, in the banking system, an indispensable element of activity. Capital plays an important role in the overall protection of the credit institution against non-diversifying and pure risks. In this sense, capital plays a shock absorber and, for this reason, its size and, above all, its structure are essential in determining the bank’s risk profile. Over the past 30 years, the evolution of bank capital has been dominated by two trends: the decrease of the weight in the total balance sheet and the diversification of the patrimonial elements. The rise in the share of bank capital, in a broad sense, in the total balance sheet of banking companies was manifested during the sixth-eighty centuries of the last century. Under the terms of the period, characterized by the strong stability of banking structures and poor market competition, the fall in capital ratio was a way to increase the rate of financial return, highlighted by the leverage effect. Contrary to the declining interest rate trend, financial profitability rates have remained at relatively satisfactory levels.

Keywords: bank capital; Cooke rules; bank solvency; weighting; banking management (search for similar items in EconPapers)
JEL-codes: G21 G32 (search for similar items in EconPapers)
Date: 2018
References: Add references at CitEc
Citations:

Downloads: (external link)
http://www.revistadestatistica.ro/supliment/wp-con ... _EN_rrss_01_2018.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:rsr:supplm:v:66:y:2018:i:1:p:101-110

Access Statistics for this article

More articles in Romanian Statistical Review Supplement from Romanian Statistical Review Contact information at EDIRC.
Bibliographic data for series maintained by Adrian Visoiu ().