Eastern European Banking Model

A traditional banking model in a CEEC (Central and Eastern European Country) consisted of a central bank and several purpose banks, one dealing with individuals’ savings and other banking needs, and another focusing on foreign financial activities, etc. The central bank provided most of the commercial banking needs of enterprises in addition to other functions. During the late 1980s, the CEECs modified this earlier structure by taking all the commercial banking activities of the central bank and transferring them to new commercial banks. In most countries the new banks were set up along industry lines, although in Poland a regional approach has been adopted.

On the whole, these new stale-owned commercial banks controlled the bulk of financial transactions, although a few ‘de novo banks’ were allowed in Hungary and Poland. Simply transferring existing loans from the central bank to the new state-owned commercial banks had its problems, since it involved transferring both ‘good’ and ‘bad’ assets. Moreover, each bank’s portfolio was restricted to the enterprise and industry assigned to them and they were not allowed to deal with other enterprises outside their remit.

As the central banks would always ‘bale out’ troubled state enterprises, these commercial banks cannot play the same role as commercial banks in the West. CEEC commercial banks cannot foreclose on a debt. If a firm did not wish to pay, the state-owned enterprise would, historically, receive further finance to cover its difficulties, it was a very rare occurrence for a bank to bring about the bankruptcy of a firm. In other words, state-owned enterprises were not allowed to go bankrupt, primarily because it would have affected the commercial banks, balance sheets, but more importantly, the rise in unemployment that would follow might have had high political costs.

What was needed was for commercial banks to have their balance sheets ‘cleaned up’, perhaps by the government purchasing their bad loans with long-term bonds. Adopting Western accounting procedures might also benefit the new commercial banks.

This picture of state-controlled commercial banks has begun to change during the mid to late 1990s as the CEECs began to appreciate that the move towards market-based economies required a vibrant commercial banking sector. There are still a number of issues lo be addressed in this sector, however. For example, in the Czech Republic the government has promised to privatize the banking sector beginning in 1998. Currently the banking sector suffers from a number of weaknesses. A number of the smaller hanks appear to be facing difficulties as money market competition picks up, highlighting their tinder-capitalization and the greater amount of higher-risk business in which they are involved. There have also been issues concerning banking sector regulation and the control mechanisms that are available. This has resulted in the government’s proposal for an independent securities commission to regulate capital markets.

The privatization package for the Czech Republic’s four largest banks, which currently control about 60 percent of the sector’s assets, will also allow foreign banks into a highly developed market where their influence has been marginal until now. It is anticipated that each of the four banks will be sold to a single bidder in an attempt to create a regional hub of a foreign bank’s network. One problem with all four banks is that inspection of their balance sheets may throw up problems which could reduce the size of any bid. All four banks have at least 20 percent of their loans as classified, where no interest has been paid for 30 days or more. Banks could make provisions to reduce these loans by collateral held against them, but in some cases the loans exceed the collateral. Moreover, getting an accurate picture of the value of the collateral is difficult since bankruptcy legislation is ineffective. The ability to write off these bad debts was not permitted until 1996, but even if this route is taken then this will eat into the banks’ assets, leaving them very close to the lower limit of 8 percent capital adequacy ratio. In addition, the ‘commercial’ banks have been influenced by the action of the national bank, which in early 1997 caused bond prices to fall, leading to a fall in the commercial banks’ bond portfolios. Thus the banking sector in the Czech Republic still has a long way to go.

In Hungary the privatization of the banking sector is almost complete. However, a state rescue package had to be agreed at the beginning of 1997 for the second-largest state bank, Postabank, owned indirectly by the main social security bodies and the post office, and this indicates the fragility of this sector. Outside of the difficulties experienced with Postabank, the Hungarian banking system has been transformed. The rapid move towards privatization resulted from the problems experienced by the state-owned banks, which the government bad to bail out, costing it around 7 percent of GDP. At that stage it was possible that the banking system could collapse and government funding, although saving the banks, did not solve the problems of corporate governance or moral hazard. Thus the privatization process was started in earnest. Magyar Kulkereskedelmi Bank (MKB) was sold to Bayerische Landesbank and the EBDR in 1994, Budapest Bank was bought by GE Capital and Magyar Hitel Bank was bought by ABN-AMRO. In November 1997 the state completed the last stage of the sale of the state savings bank (OTP), Hungary’s largest bank. The state, which dominated the banking system three years ago, now only retains a majority stake in two specialist banks, the Hungarian Development Bank and Eximbank.

The move towards, and success of privatization can be seen in the balance sheets of the banks, which showed an increase in post-tax profits of 45 percent in 1996. These banks are also seeing higher savings and deposits and a strong rise in demand for corporate and retail lending. In addition, the growth in competition in the banking sector has led to a narrowing of the spreads between lending and deposit rates, and the further knock-on effect of mergers and small-hank closures. Over 50 percent of Hungarian bank assets are controlled by foreign-owned banks, and this has led to Hungarian banks offering services similar to those expected in many Western European countries. Most of the foreign-owned but mainly Hungarian-managed banks were recapitalized after their acquisition and they have spent heavily on staff training and new information technology systems. From 1998, foreign banks will be free to open branches in Hungary, thus opening up the domestic banking market to full competition.

As a whole, the CEECs have come a long way since the early 1990s in dealing with their banking problems. For some countries the process of privatization still has a long way to go but others such as Hungary have moved quickly along the process of transforming their banking systems in readiness for their entry into the EU.

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Reasons Why you Should Work With Insurance Adjusters

The first step in filing for an insurance claim for many people is still to contact their insurance agent and give them all the required information and become energy efficient. Many people follow it up with contacting an insurance adjuster. Unlike the insurance adjusters assigned by the insurance company, a private insurance claim service works for the policyholder. It is crucial that you find someone that is experienced enough in the world of insurance claims since they determine the value of the loss and even become energy efficient. In the event of a claim, the insurance company will always have an insurance adjuster to minimize the demands on their behalf and failing to hire one will be a big mistake on your side. Insurance claim services offer a variety of benefits for people that need to start an insurance claim. This website looks to help you learn more about the different advantages of hiring insurance claim services.

Expert policy interpretation is critical during an insurance claim process, and insurance claim services ensure that you access it. The job of an insurance claim service is based on how well they know and understand property insurance policies and building bylaws. When you hire an insurance agent, it becomes their duty to provide trustworthy advice on matters related to protecting your property. Due to a lack of information, many policyholders do not fully understand the type and extent of coverage on the insurance policies and what level of coverage can be considered to be adequate. One of the most common mistakes that many policyholders make is waiting until they have to file a claim to determine if they lack enough coverage. Insurance claim services invest in ongoing training and certification as a way of ensuring that they stay up-to-date with the ever-changing insurance laws and regulations.

There is no better way to get insightful claims development than by hiring an insurance claim service. When you need to file an insurance claim, you are required to prepare reams of claims data which put you in a position to negotiate an insurance claim effectively. Even the most knowledgeable people are going to struggle with this data preparation in the event of an insurance claim and become energy efficient. With their experience in insurance claims, insurance claim services, not the type of data to provide to an insurance company to elicit a settlement for your complaints. They also know how to structure the data to ensure you are fully compensated.

You get help when it comes to the claims negotiation process by hiring an insurance claim service. Strategic negotiation is not a skill that everyone has and even become energy efficient. As long as they have a clear understanding of the facts of the case and the circumstances surrounding the claim, insurance claim services negotiate from a position of strength raising the chances of a successful resolution and energy efficient.

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Learn More About Echocardiography Here!

There is an integral part that is associated with ultrasound for the doctors to check on the condition of the unborn baby inside the womb of the mother. There are indeed a wide utilization of ultrasound so as to monitor the internal of an individual. Physicians can easily monitor the bones, muscles, organs, blood vessels and heart of the unborn child through the help of this tool. Echocardiography is used to label when the ultrasound is used to check the heart of the person. Our heart has indeed integral functions inside our body. With this, to make sure that the organ is in good condition, there is a need to have the regular check-up.

Two thousand gallons of blood is being pumped by the heart in a day which will be distributed throughout the body. For instance that the heart has something wrong, there is a need to consider getting a tool that could monitor the condition of the organ. The doctor can easily monitor the condition of the heart though the use of echocardiography as the tool. The size and thickness of the chambers, the functioning of the valves, the direction of the blood flow throughout the body, the possible blood clots, the area of the damaged cardiac muscle tissue, and the problems affecting the pericardium can be seen when echocardiogram is used.

In terms of using echocardiography, there are several benefits that can be acquired including those who have heart attacks, strokes, or unexplained chest pains. This is because of their need for this in order to monitor the condition of their hearts. Besides, through echocardiography, persons who have history of heart murmurs, congenital heart defects, and rheumatic fever can take advantage of it. In connection to this, the market needs echocardiographs technicians that can operate the tool so as to help people who have heart issues.

Echo technicians are offered with great salary in the market due to the demand that is associated with the job. It is one of the well-paid professionals in the market which is a great means of living. Additional increase can be obtained for the salary depending on the education, certification, additional skills, and the number of your experience in the industry. There is an assurance that you will be interested in becoming an echocardiographs technician due to the salary that is being offered. For instance that you are interested to become one of the echo technicians who can help individuals with their internal concerns particularly the heart, the basic thing that you have to consider is education. After having the education, additional skills and trainings are also vital to consider.

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Factors to Consider When Looking for the Best Lawyer in Indiana

It is important understand that lawyers can prove to be very important professionals especially when it comes to helping people get information regarding different types of legal implications. One thing that you need to understand is that so many people today will always consider hiring the services of attorneys for a variety of purposes. For example, somebody to hire the services of an attorney to provide them with different types of legal services that can help them especially when they have been taken to court for a variety of purposes. One of the most important things that need to understand is that when you hire the services of a good attorney, there is a high likelihood that you will be able to enjoy so many advantages. They can be able to protect your rights and also ensure that you get all the necessary legal services that you need. Sometimes, being in a position to hire the services of the best attorney may not be very easy and this might require that you consider looking at some very vital factors.

Anytime you are planning to hire the services of a good lawyer, you need to ensure that you ask yourself whether that particular has the level of experience that is required. This is very important because the field of law is considered to be very complex and for this, you should only engage somebody that has a lot of experience when it comes to providing people with different types of legal services. One of the most important questions you probably want to ask yourself when choosing the best attorney is that that particular lawyer may have specialized in your area of need. There are different types of lawyers are available in the world today and therefore, identifying the specific lawyer that you need can be very important. For example, you might find that different lawyers may have specialized in criminal defense law while others may have specialized in personal injury law and real estate law. It is therefore important that you consider identifying the specialization of a particular lawyer before you hire them.

You will need to pay that particular lawyer when you hire their services and therefore, you must ensure that you focus on the cost implications of choosing the best lawyer in your region. This can prove to be very important because when you hire a lawyer that is quite affordable, you will realize that you will not have to struggle getting quality legal services which is considered to be very important. Another important question you probably want to ask yourself is the quality of services that particular lawyer may have provided to people in the past. This will give you the confidence that you will be able to get quality legal services when you hire a lawyer that has been providing quality services in the past. You can also use the Internet to get information regarding different types of lawyers that can always engage.

A Quick Overlook of – Your Cheatsheet

Interesting Research on – Things You Probably Never Knew

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