Sementsov R. Commercial banks financial condition diagnostics

The thesis clarifies the theoretical foundations of the concept of “diagnostics”; structural elements and essential features of the bank’s financial condition. The main structural elements of the process of diagnosing the financial condition of the bank are highlighted, the system for diagnosing the financial condition of the bank is determined. The relationship between the concepts “financial condition of the bank” and “diagnostics of the financial condition of the bank” has been determined. The approach to diagnostics of the bank’s financial condition based on the bank’s risk profile has been substantiated. The expediency of using an approach to determining the financial condition of a bank based on the probability of default of a particular bank has been proved. The categories and types of risks to which the bank is exposed, the approach to the organization and functioning of risk management systems in banks are considered. Approaches to the analysis of the bank’s solvency and capital adequacy are considered; approach to the analysis of a bank’s credit risk; approach to the analysis of the risk of loss of bank liquidity; approach to the analysis of a bank’s market risk; the approach to the analysis of the bank’s currency risk is considered. The use of the approach to determining the market share of the bank, the BCG matrix by the indicators of total income / loss is reasoned. The level of concentration of the banking market is analyzed and general problems of the banking sector development are identified. The level of influence of the leading banks in the banking market is proved and the dependence between the indicators of the balance sheet currency of Ukrainian banks is substantiated. The process of forming an information base for determining the financial condition of the bank is determined. The main results of the study are the development of practical recommendations for organizing the process of diagnosing the financial condition of the bank and the creation of a methodology for determining the financial condition of the bank by determining the indicator of the probability of bank default by researching the banking market, clustering banks and determining the risk of default of a particular bank based on the analysis of the quality of the bank’s net cash flow, financial condition of Ukrainian banks. The general algorithm for diagnosing the financial condition of the bank based on stress testing is clarified. The method for determining the probability of a bank’s default is clarified, based on the clustering of the aggregate of banks by determining the dynamics of the share of a particular bank in the banking services market, the composition of the elements of the net cash flow from the operating, investment and financial activities of the bank based on the financial statements of Ukrainian banks, the index of the influence of a particular bank on the local market.