Naslov
The Interdependence Between Bank Provisions and Bank Placements in the Croatian Banking Sector

Autori
Gulin, Danimir ; Perčević, Hrvoje ; Hladika, Mirjana

Izvornik
Theoretical and applied economics (1841-8678) 19 (2012); 133-150

Vrsta, podvrsta i kategorija rada
Radovi u časopisima, članak, znanstveni

Ključne riječi
placements ; credit risk ; risk groups ; bank provisions ; profitability ; Croatian banking sector

Sažetak
In their business banks are exposed to numerous risks. Among them, credit risk is one of the most important. Through approved loans, banks are exposed to credit risk and, depending on the extent of these exposures and recoverable of the loans, loans are classified into risk groups. According to risk groups, banks have to carry out impairment of loans in order to protect against the risk of the debtor’s inability to perform its liabilities according to bank. This impairment of loans are recorded in the balance sheet assets in the account of loan adjustments and in the income statement as the expense, which directly affect the decrease banks’ profit and profitability. According to level of credit risk, all banks off-balance sheet liabilities have to be classified into risk groups and according to this risk groups banks have to carry out provisions to cover potential losses. Provisions are recorded as the expense in the income statement and in the balance sheet liabilities on the account of provisions. Accordingly, the main hypothesis of the paper state “between bank provisions and bank placements of the Croatian banking sector exists significant interdependence”. According to the research results, there is a strong positive linear relationship between bank provisions for identified losses and bank placements and a strong negative linear relationship between bank provisions for unidentified losses and bank placements.

Izvorni jezik
Engleski

Znanstvena područja
Ekonomija

Napomena
Rad je prezentiran na skupu 1st International Conference Accounting and auditing perspectives održanom od 29.-30.2012.g., Timişoara, Rumunjska

POVEZANOST RADA