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Gergana Mihailova
Bank Efficiency in Bulgaria in the Period 2007-2013: Application of Parametric Method Stochastic Frontier Analysis (SFA)
Summary:
The study uses a nontraditional method for the measurement of bank efficiency - parametric method "stochastic frontier analysis" (SFA), to help analyze the efficiency of the entire banking system in Bulgaria and individual groups of banks by ownership. This method has been applied in numerous studies of bank efficiency in a group of countries, but it is not used for the purpose of measuring the efficiency of the Bulgarian banking system. The survey results show that foreign banks are the most efficient banks in the economy and determine the dynamics of the efficiency of the banking system. Their better performance is explained by the technology and experience they have.
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Elena Ralinska
The Bussiness Model of the Peer-To- Peer Lending Platforms
Summary:
Peer-to- peer lending platforms as alternative of the conventional bank loan are analyzed in the current paper and in this context; we try to identify their essential features, similarities with and distinctions from traditional channels, advantages and disadvantages, problems and opportunities as well as future trends in their development. In our view, peer-to-peer lending platforms provide a valid alternative of financing, not a substitute for, but rather a complementary traditional banking model.
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Nesrin Uzun
Impact of the Global Financial Crisis on Housing in Bulgaria
Summary:
Negative effects of the global financial crisis is still not fully overcome in the world and the economies of individual countries continue to implement various measures to eliminate their effect. One of the most crisis-hit sectors of the economy proved to be construction and directly related to it real estate market. This article aims to make a critical analysis of the status and trends in the "construction", with an emphasis on housing during the 2008-2013 period. In order to thoroughly investigate the problem, the article will consider the state of the mortgage market in Bulgaria and opportunities for bank financing of construction enterprises (through direct funding and realisation of finished products - by financing customers in the form of housing loans) and their relation to the development of the construction sector in the country.
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Bozhidar Bozhinov
Possibilities to Evaluate the Sustainability of the Banks in Bulgaria using a Rating System ALER(TS)
Summary:
As the global financial crisis of 2007 shows, the modern banks are crucial for the stability of the financial sector and the economy as a whole. The study aims to present to academics and banking professionals the developed methodology of the evaluation system for sustainable development of the banking sector ALER(TS) and assess the extent of its applicability based on real data analysis. The study argues that an independent and open-rating system to evaluating the banking sector contributes to increase its stability and competitiveness.
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Plamen Lyubomirov Dzhaparov
Generative Artificial Intelligence and the Potential Benefits for Banks
Summary:
There is no doubt that the emergence of ChatGPT in November 2022 has become one of the most significant technological events in recent decades. The new-generation chat platform developed by OpenAI has caused a veritable "tsunami" of interest in its underlying Generative Artificial Intelligence (Gen AI). Business organizations in all economic areas are dramatically increasing their investments in this new technology and launching pilot projects testing its capabilities. Banks are no exception to this trend. With the vast amounts of data at their disposal and ever-increasing user demands, they are quickly realizing that Gen AI promises numerous benefits both concerning customer service and in terms of internal banking processes and operations.
This paper examines the characteristics of generative artificial intelligence by comparing it with traditional AI models that have been used in banks. The main factors that make banking the perfect place for the application of the new technology are brought out. Based on this, the analysis focuses on surveying the many potential benefits of its implementation – from improving customer experiences, through better risk management, to optimizing the work of back-office employees and developers.
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Andrey Zahariev, Galina Zaharieva, Margarita Mihaylova
Digitalization and Recruitment of Human Resources in Banking and Insurance Companies: A Comparative Analysis
Summary:
The present study has a theoretical and empirical perspective in its construction. In the first aspect, the aim is to study the theoretical achievements in the field of digital technological solutions for the selection of human resources, their potential advantages and disadvantages, and in the second aspect - an analysis of the policies of the Bulgarian financial enterprises in the field of digitalization, incl. human resources, the practices of using modern techniques of selection, the potential for their improvement and refinement. The object of the research is the Bulgarian enterprises from the banking and insurance sectors, and the subject - their digitalization policies and the modern methods of selection of human resources that they use. The surveyed insurance companies form 65.35% of the gross premium income of the Bulgarian non-life insurance market as of 30.06.2022. The studied credit institutions are licensed by the BNB commercial banks in the Republic of Bulgaria, which manage 70.04% of the assets in the banking system of the studied national market as of 30.06.2022. The comparative analysis of the two groups of financial enterprises shows both similarities and significant differences. Due to the larger number of managed personnel, commercial banks are developing their own platforms for digitization and HR selection, while the process for insurers is more conservative and relies on intermediaries. The received answers to questions on the Likert scale related to digitalization in human resources management establish significant differences in expert assessments for the two groups of financial enterprises.
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Zhelao Vytev
Discussion Questions of Stress Testing in the Modern Bank Practice
Summary:
The present article provides critical analysis of the existing practice for carrying out of stress-test in the banking sector in the country and abroad. It provides good grounds for accentuating on a number of unsolved or discussion issues, concerning: significance of the stress-tests; scope and periodicity of their implementation; identification of the specific risks, with potential negative effects; scenario modelling with specifying key risk parameters (factors), subject of shocking changes; performance of comparative analysis of the methods for implementing stress-tests and outlining of their advantages and disadvantages; specifics of implementation of the so-called „reverse" stress-tests, etc.
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Nataliya Marinova
Information Society in European Union and Bulgaria – Situation and Trends in Information and Communication Technologies Usage
Summary:
The European Union has long recognized the role of information and communication technologies (ICTs) as key factor to greater competitiveness and integration of business organizations of the continent into the global economy. Currently, the transition to the Information Society has no alternative. Matter of national choice of each Member State, including Bulgaria, is not whether to build such, but manner and forms of its realization. Development of Information Society is a cross-border and transnational process in which individual countries implement their national policies.
The theme of this paper is to investigate legislation, condition and trends in European Information Society. The aim of the study is a comparative analysis of indicators characterizing the Information Society in Europe as a whole and Bulgaria in particular. An empirical data from the websites of Eurostat, National Statistical Institute and the survey with the participation of the author are used for achieving the objective.
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Ivan Marinov
Corporate Social Responsibility of Bulgarian Banking Sector – Mission and Business Practice
Summary:
As a consequence of legal regulation, the organization of bank activity and established traditions, society often treats commercial banks only as subjects, absorbing and redistributing monetary resources in order to obtain financial advantage which benefits both banks and their owners. However, a similar perception is not applicable to the vision of modern banks which demonstrate aspirations of harmony with the surrounding socio-economic environment and a desire to improve their image in the corporate community. In this respect, corporate social responsibility of banks is a way to voluntarily integrate their business into national and international processes.
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Emilia Milanova
The New Philosophy Of Basel III
Summary:
The study discusses the major objectives of the Basel III reform package as a philosophy of the new capital accord. It emphasizes the improvement of the capital framework in five main aspects: strengthening the quality, consistency and transparency of the capital base; risk coverage improvement; supplementing the risk-based capital requirement with the leverage ratio; reduction of procyclicity of the counter-cyclical buffers; solution to the issues with the system risk and interconnectedness. The introduction of a global standard for liquidity is presented as another significant aspect in the Basel III package. The paper analyses the question to what extent the Bulgarian banking system is prepared for the new more rigid capital requirements.
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Elena Stavrova
The Changes in the Banking Industry under the Influence of the Digitalization Process in the Conditions of Covid-19 Pandemic
Summary:
The market capitalization on the world banking market reached USD 7.2 trillion, and on the digital banking market - more than USD 800 trillion. The average annual growth of 4% has long been a stable source of income for banks. The development of digital consumer lending and payment systems is also attracting non-banking players, who are expanding their influence in institutional business, which makes the corporate banking market dynamic. The profound change brought about by the open and interconnected corporate banking ecosystem is taking place in conditions of extreme change, zero interest rates and a surplus of money supply. Although some areas of the financial markets are less exposed to these significant shocks, it is impossible to protect them from development in an open ecosystem. These changes may even be slower or less pronounced in some services, such as structured lending, large corporate payments, but technological developments are also taking place. Working with 'full vaults', emerging FinTech competitors, the COVID-19 pandemic and the slower-than-expected recovery of global supply chains are all challenges that banks need to address and are the subject of this study.
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Georgi Batashki, Nikolay Ivanov
Contemporary Aspects of Bank's Accounting Policy
Summary:
The banks are basic element of the banks system with a basic object of activity financial intermediary and money business. They mobilize and transform into active capital significant part of the money resources of the Economy, they do the payments between companies and population also they realize various credit, investment and other operations. In such a way the banks permit to set in motion the savings sourced from the lack of correspondence in the goods and money movements, to settle down timely and without losses the relations between the enterprises in the country and these from abroad.
The banks are a strong factor in the realization of the financial policy of the country. Due to the close relations with the regulatory organs and the Government, and also with the Instructions applied, the banks play basic role in supporting of the public trust into the money system. Due to this reason there is a considerable interest to the successfully functioning of the banks, especially what concerns their liquidity and solvency. The role of the Accounting and the Accounting policy in this process are very important. They will be object of this research.
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Kuzman Iliev
The School of Free Banking with Fractional Reserves versus The School of Full Reservation of Deposits - an Economic Reflection of Modern Concepts in Banking and Monetary Policy
Summary:
The study presents a comparative analysis of the two modern pro-market schools in the field of monetary theory and banking – the school of free banking with fractional reserves and the school of full deposit reservation. In this way, the paper outlines the guidelines to be followed in developing theories, concepts and proposals for improving or perfecting the money supply management. In concrete terms, the analysis considers the alternatives for the implementation of banking and the positioning of the central bank in the schools of free banking with fractional reserves and the full reservation of deposits, the methodological nature of a market process in their frameworks and an interpretation of the two schools in relation to the functions of deposits, the interest rate, deflation and quantitative easing.
