Bank provisions in the context of the COVID-19 pandemic
The result's identifiers
Result code in IS VaVaI
<a href="https://www.isvavai.cz/riv?ss=detail&h=RIV%2F62156489%3A43110%2F22%3A43921528" target="_blank" >RIV/62156489:43110/22:43921528 - isvavai.cz</a>
Result on the web
<a href="https://4ab039238f.clvaw-cdnwnd.com/86dee696f396962ce1759356ee8577e1/200000170-688886888b/e-Conference%202022-6.pdf?ph=4ab039238f" target="_blank" >https://4ab039238f.clvaw-cdnwnd.com/86dee696f396962ce1759356ee8577e1/200000170-688886888b/e-Conference%202022-6.pdf?ph=4ab039238f</a>
DOI - Digital Object Identifier
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Alternative languages
Result language
angličtina
Original language name
Bank provisions in the context of the COVID-19 pandemic
Original language description
The paper deals with the issue of making banks' provisions in the context of the current economic development in connection with the ongoi ng COVID-19 pandemic. It focuses on risk in the banking business, especially credit risk. It is the existence of credit risk that gives rise to the obligation of banks to make provisions for loans receivable, which is the main topic of the paper. In making provisions and calculating their correct level, banks followed the International Accounting Standard IFRS 9 - Financial Instruments, which has been in force since 2018. The starting point for determining the correct level of provisions for the bank's receivables is the classifi cation of loans receivable. When calculating the provisions for loans receivable, the provisioning method under IFRS 9 focuses mainly on future expected losses and introduces a new classifi cation of loans receivable, the so-called staging. Depending on the classifi cation of loans receivable into stages, banks then make provisions under IFRS 9 for 12-month or lifetime expected credit losses. The research part of the paper concentrates on the timeliness of provisioning of banks in the Czech Republic in relation to the evolution of the riskiness of bank loan portfolios in the year 2020. For selected banks the quality and composition of loan portfolios, the evolution of the volume of loans in individual stages, and the level of provisions were assessed. Loan provisioning was assessed in the context of the adoption of a legal moratorium, which allowed an across-the-board deferral of repayments to bank customers for up to six months in 2020.
Czech name
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Czech description
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Classification
Type
D - Article in proceedings
CEP classification
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OECD FORD branch
50206 - Finance
Result continuities
Project
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Continuities
S - Specificky vyzkum na vysokych skolach
Others
Publication year
2022
Confidentiality
S - Úplné a pravdivé údaje o projektu nepodléhají ochraně podle zvláštních právních předpisů
Data specific for result type
Article name in the collection
European Forum of Entrepreneurship 2022: Proceedings of the 15th International Scientific Conference
ISBN
978-80-87325-58-2
ISSN
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e-ISSN
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Number of pages
13
Pages from-to
159-171
Publisher name
Newton College a.s.
Place of publication
Praha
Event location
Praha
Event date
Mar 24, 2022
Type of event by nationality
EUR - Evropská akce
UT code for WoS article
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