Financial Sector Stability: Essence and Assessment

Анотація

The article investigates approaches to the interpretation of the notion “financial stability” and the features of its assessing as an important instrument of macroprudential financial supervision. It is emphasized that the existing tools for assessing the financial sector stability have their advantages and disadvantages, which are defined by the authors. In the paper there applied the method of convolution of criteria to assess financial stability in Ukraine. The calculation of the composite indicator is based on values of financial soundness indicators determined by the IMF, which for the purpose of the research are divided into three groups. As a result the indicator of financial stability includes the components of capital adequacy, credit risk and liquidity. It allows using the regression procedure for evaluation of the influence of these components on financial stability of the country. The interpretation of the results indicate that raising the level of financial stability in Ukraine requires, first, improving approaches to managing credit risk, then increasing liquidity rates and, ultimately, improving the capital adequacy of financial intermediaries.

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