Qualitative Indicators of Bank Performance Assessment for the Purposes of Participation in the Deposit Guarantee System in Ukraine

Abstract

One of the directions of reforming the system of deposit insurance in the world is risk-oriented approach, which means that the degree of involvement in the system is determined by the degree of exposure of the participant’s operations to risk. Correct estimation of the degree of risk of banking operations requires a well-grounded approach to the study of indicators-criteria that should be clear, understandable, and objective. The subject of research is the performance of the deposit guarantee system in Ukraine. Therefore, the present research aims to solve applied problems of establishing the content of qualitative indicators of banking operations that arise in their application for the sake of determining the degree of risk in the operations of the participant of the Deposit Guarantee Fund in the estimation of the amount of recurring charges. Methodology. Systemic method was applied to establish the content and assign qualitative indicators of bank performance for establishing their actual content in accordance with the regulation. On this basis, using a formal logical method, definitions of legal notions were formulated with due account of the financial and economic meaning as well as the established goal of legal regulation. Formal dogmatic approach allowed to make an analysis of the regulatory and legal framework of the state, to identify functional capacity of the system of protection of the rights and interests of bank depositors, their technical and legal excellence. Also, a number of other general scientific methods of research were applied, in particular: analysis (to study systemic application of the notions), historical legal (to study the establishment, change and development of the deposit guarantee system), comparative legal (to study the legislation determining specific principles of the functioning of the deposit guarantee system of natural persons in foreign states) etc. As the result, there has been established the essence of the current qualitative indicators used in the determination of the degree of risk of banking operations in Ukraine as far as application of the means of influence for violation of banking legislation by the National Bank of Ukraine to participating banks over the reporting period, as well as administrative and economic sanctions applied for violation of legislative requirements related to the deposit guarantee system of natural persons are concerned. Also, proposals have been developed concerning the procedure of their application for the sake of increasing the opportunities for ensuring risk-oriented approach.