On 9 June 2016, the Researchers Club held its 21st session
On 9 June 2016, the Researchers Club held its 21st session. After the opening remarks by the Vice Governor Anita Angelovska Bezhoska, at the session the following papers were presented: "Bank specific and macroeconomic determinants of non-performing loans in the Republic of Macedonia: a comparative analysis of loans to enterprises and households" by Jordan Kjosevski and "Determinants of capital structure of the corporate sector: the case of the Macedonian economy with panel data" by Biljana Jovanovic.
The study of Mr. Kjosevski is aimed at identifying the determinants of the non-performing loans to enterprises and households in the country for the period 2003 to 2014. The author examines two groups of determinants - macroeconomic determinants and bank specific determinants. In the analysis, the author points out two models - one pertaining to the non-performing loans to households and another to the non-performing loans to enterprises - that are evaluated by the co-integration method. The results of the research imply that the bank profitability, the increase in the borrowings by enterprises, i.e. households and the GDP growth contribute to decrease in the non-performing loans. On the other hand, the improved solvency of the banks and the increased non-employment are associated, as well to the rise in the non-performing loans. The inflation instigates a decrease in the non-performing loans, but exclusively in case of households. A factor that had a substantial influence on the increase in the level of the non-performing loans in both sectors, is also the global financial crisis, which is included by introducing an artificial variable. The author concludes that despite the fact that the non-performing loans are under the influence of the cycles in the real economy, which proves the financial instability hypothesis of Minsky, they can be managed, to certain extent, through proper determining of the credit demand volume and the structure of the banks’ assets and liabilities, which have statistically significant influence, as well. The monetary authority, in the capacity of a regulator, has a significant role in that managing by ensuring safe and sound banking system and directing the banks towards better risk management.
The purpose of the study of Ms. Jovanovic is to give an overview of the determinants of the capital structure of the enterprises in the Republic of Macedonia. Therefore, data on 194 enterprises for the period 2000-2014 were used. To be more precise, the author focuses on two questions. First, by using a dynamic panel methodology, the author tries to identify the determinants of the financial leverage of the Macedonian enterprises. Second, the paper includes analysis of enterprises’ leverage decisions before and after the financial crisis. Regarding the first matter, the results show that the size of the corporations and major growth opportunities correspond to higher borrowing, while profitability, tangibility (collateral) and non-debt tax shields are associated with lower borrowing. As for the second matter, the pre-crisis level of the aforementioned determinants does not explain the post-crisis behavior of Macedonian enterprises. The exception is the pre-crisis level of leverage whose influence on the behavior of companies after the crisis is assessed as important, i.e. the enterprises with higher leverage before the crisis, adjusted their leverage more than other companies. Another aspect related to the changes in the behavior of companies in both periods is the direct effect of the global financial crisis - those companies that have registered major changes in the performance indicators (profit, revenue, sales) during the crisis, have also made and greater adjustment in the level of leverage in the post-crisis period.
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