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Czech Commercial Banks' Net Interest Margin Analysis with Regards to the Changes of Recent Years
Brousil, Martin ; Teplý, Petr (advisor) ; Katuščáková, Dominika (referee)
Czech Commercial Banks' Net Interest Margin Analysis with Regards to the Changes of Recent Years Bachelor thesis Martin Brousil Abstract The rapid development of digital technologies in recent years has influenced the whole business world, with the banking industry being no exception. For banks, it has brought many advantages, such as greater cost efficiency or higher availability of information about clients, but also new challenges for their business models and a growing number of direct and indirect competitors. This thesis analyzes the most salient trends present in the industry: the digitalization of banking, the growing competition, a shift in customer preferences and the stricter regulation of the banking business. Further, it focuses on the decreasing interest rate margin of Czech banks and attempts to find its causes. The size of bank, its cost efficiency and operational risks are identified as important determinants of the margin and also GDP growth and the degree of competition within the sector are found to play their roles in the determining process. At the end, the results are used and the qualitative and quantitative trends are linked together, since, as the author argues, a close relationship between them exists. Keywords Banking, Clients' Preferences, Competition, Digitalization, Regulatory...
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Analysis of the impact of low interest rates on bank profitability
Zemanová, Kateřina ; Dvořák, Petr (advisor) ; Staniek, Dušan (referee)
This thesis aims to analyze the significance of the impact of low interest rates on profitability of banks in the Czech Republic. Profitability of banks is examined through an analysis of the financial profitability ratios on a sample of 6 banks in the period 2004 to 2014. A more detailed analysis and a better assessment of the impact of low interest rates on bank profitability are used decomposition of return on equity, which did not show the effect of low interest rates on return on assets. A more relevant indicator for assessing the impact of low interest rates is the net interest margin, reflecting a negative impact with half of all banks. The financial analysis results were confirmed in a subsequent regression analysis, which examined a variety of internal and external determinants of profitability including the impact of low interest rates. The impact of low interest rates, there was again demonstrated only in the net interest margin, but it certainly can not talk about the dominant factor.
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