Advantages of the Macedonian Financial System

Document Sample
Advantages of the Macedonian Financial System Powered By Docstoc
					    Advantages of the
Macedonian Financial System
                         Trajko Slaveski, PhD
Minister of Finance in the Government of the Republic of Macedonia
                         www.finance.gov.mk

                           September
                             2008
   Structure of the Macedonian Financial System
         in total assets and portion in GDP



  Subsystems        Total Assets Portion in GDP

Banking System         91.67%           65.9%

Insurance System       4.48%             3.3%

Financial Leasing      2.02%             1.6%

 Capital Market        1.83%             1.3%
                     Banking System

      Banking system in the Republic of Macedonia
        comprises 18 banks and 12 saving houses

                             Main features
 Banking activities in the Republic of Macedonia are regulated under
   the Banking Law

 There are no legal obstacles for entrance of foreign banks in the
   Macedonian financial market;

 Foreign banks are also enabled to perform financial activities in the
   Republic of Macedonia by opening their branches;
                    Banking System

                             Main features

 High profitability: ROA = 1.8% ; ROE = 15.2% increase of 2.9
  percentage points in comparison with 2006;
 Continuous trend of profit increase (21% growth in comparison with
  2006);
 Adequate liquidity of banks (liquid assets/total assets = 34.2%);
 Increased competitiveness and improved operating efficiency;
 Reduction of interest rates and easier access of both physical persons
  and legal entities to credits;
 Constant increase in the deposit base of the banks;
 Constant reduction of the share of non-performing loans in total
  credits;
 Increased credit activity of the banks (growth by 40% in 2007).
                  Insurance System

  The Insurance system in the Republic of Macedonia
    comprises 12 insurance companies, 7 insurance
    brokerage companies and 3 insurance agencies

                             Main features
 Basic legal framework regulating the relations on the insurance market
   includes the Law on Insurance Supervision and the Law on
   Compulsory Insurance in Traffic;
 Requirements for market entry refer to requirements for capital
   adequacy, fit and proper criteria for shareholders and management
   bodies and other measures for risk management applying equally to
   domestic and foreign legal entities and physical persons;
                  Insurance System

                            Main features

 Initiation of the II phase of the Stabilisation and Association
  Agreement with EU (second half of 2008) would enable entry of foreign
  insurance companies through branch offices;
 Continuous growth of the number of active entities as a result of the
  high profitability rate: non-life ROA =2.13%, life ROA=0.81%;
   non-life ROE = 11.61%, life ROE = 3.32%
 Increased gross premiums (12.2% in comparison with 2006)‫‏‬
 Domination of foreign capital in the ownership structure;
 Constant decline of market concentration measured via the share of
  the two biggest insurance companies in the total gross policy
  premium.
                   Financial Leasing

     There are 7 active companies performing on the
   financial leasing market. 1 company was established
                  in the second half of 2008
                             Main features

 Financial leasing market is regulated according to the Law on Leasing,
  ensuring fast and easy establishment of leasing companies;
 No legal barriers for entry of foreign investors; they have equal rights
  and treatment as the nation investors;
 Financial leasing market undergoes continuous growth trend – growth
  of assets and capital;
 High profitability: ROA = 1.5%, ROE = 34.3%;
 Dominant foreign capital: 96.8%(Hypo Alpe Adria, NLB Leasing, Euro
  Leasing, Maklease, Porshe Leasing).
                      Capital Market
   The Macedonian Stock Exchange has 26 members
           authorised to trade with securities
        (19 brokerage companies and 7 banks)‫‏‬
                             Main features
 The capital market is regulated with the Law on Securities, Law on
  Investment Funds, and Law on Taking Over Joint Stock Companies
  (more details at www.sec.gov.mk);
 The capital market in Macedonia comprises the Macedonian Stock
  Exchange and the OTC market (more details at www.mse.org.mk);
 Two Investment Fund Management Companies that manage the assets
  of three Opened Investment Funds and Nine Private Funds
  Management Companies that manage the assets of 14 private funds.
 In the first half of 2008, the SEC has Issued approvals for establishing
  other three Investment Fund Management Companies
                           Capital Market
      Significant development of the capital market with
          increased participation of foreign investors.
    Implications from the Global Financial Crises seen in the
                        first half of 2008

 Traditional trading
    2004 / 2003 = growth 19.12 %
    2005 / 2004 = growth 144.08 %
    2006 / 2005 = growth 61.08 %
    2006 / 2007 = growth 181 %
    First half of 2008 / 2007 = - 72.2%

 Total trading
    2004 / 2003 = growth 19.12 %
    2005 / 2004 = growth 144.08 %
    2006 / 2005 = growth 61.08 %
    2007 / 2006 = growth 34.45%
    First half of 2008 / 2007 = - 68.67%
                         Capital Market

 Number of transactions
    2005 / 2004 = growth 83.20 %
    2006 / 2005 = growth 64.83 %
    2007 / 2006 = growth 168.25 %
    First half of 2008 / 2007 = - 71.93%
 Market capitalization
    2004 / 2003 = growth 4.88 %
     2005 / 2004 = growth 171.49 %
     2006 / 2005 = growth 71.50 %
     2007 / 2006 = growth 183.77%
     First half of 2008 / 2007 = - 36.59 %
 Macedonian Stock Exchange Index
     2004 / 2003 = growth 14.67 %
     2005 / 2004 = growth 69.58 %
     2006 / 2005 = growth 61.54 %
     2007 / 2006 = growth 109.07%
     First half of 2008 / 2007 = - 48.99%;
THANK YOU FOR YOUR ATTENTION

     You are welcome to
   INVEST IN MACEDONIA!

				
DOCUMENT INFO
Shared By:
Categories:
Tags:
Stats:
views:18
posted:11/27/2010
language:English
pages:11