Financial Sector Assessment Program Update : Republic of Kazakhstan - Bank Profitability and Competition
The purpose of this note is to explore the reasons for a comparatively high interest rate spread in Kazakhstan in the context of competition in the banking sector. In spite of significant gains in efficiency made in recent years, operational costs...
| Main Authors: | , |
|---|---|
| Format: | Financial Sector Assessment Program (FSAP) |
| Language: | English en_US |
| Published: |
World Bank, Washington, DC
2013
|
| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/2004/08/18004498/kazakhstan-bank-profitability-competition-technical-note http://hdl.handle.net/10986/16064 |
| id |
okr-10986-16064 |
|---|---|
| recordtype |
oai_dc |
| repository_type |
Digital Repository |
| institution_category |
Foreign Institution |
| institution |
Digital Repositories |
| building |
World Bank Open Knowledge Repository |
| collection |
World Bank |
| language |
English en_US |
| topic |
ACCOUNTING ACCOUNTING FRAMEWORK BALANCE SHEET BANK ASSETS BANK BRANCHES BANK LENDING BANK MARGINS BANK POLICY BANK PROFITABILITY BANK REGULATIONS BANK SECRECY BANKING INDUSTRY BANKING MARKET BANKING MARKETS BANKING SECTOR BANKING SERVICES BANKING SYSTEM BANKING SYSTEMS BANKS BORROWING BRANCH NETWORKS BROAD MONEY CAPITAL ACCOUNT CAPITAL ACCOUNT LIBERALIZATION CAPITAL MARKETS COMMERCIAL BANKS CONSUMER PROTECTION COST STRUCTURE COUNTRY COMPARISONS CREDIT BUREAUS CREDIT RISK CREDIT RISKS CREDITOR CREDITOR RIGHTS DEBIT CARDS DEPOSIT DEPOSIT INSURANCE DEPOSIT RATE DEPOSIT RATES DEPOSITORS DEPOSITS DOMESTIC BANKING ECONOMIC CRISIS ECONOMIC GROWTH ENTRY REQUIREMENTS EXTRAORDINARY INCOME FINANCIAL DEEPENING FINANCIAL INFORMATION FINANCIAL INTERMEDIATION FINANCIAL MARKETS FINANCIAL POLICIES FINANCIAL SECTOR FINANCIAL SYSTEMS FLEXIBLE EXCHANGE RATE FLEXIBLE EXCHANGE RATE REGIME FOREIGN BANK FOREIGN BANK ENTRY FOREIGN BANKS FOREIGN CURRENCY FOREIGN ENTRY FOREIGN EXCHANGE GOVERNMENT SECURITIES HOUSING INCOME GROUPS INFLATION INFLATION RATE INFORMATION ON BORROWERS INTEREST EXPENSE INTEREST EXPENSES INTEREST INCOME INTEREST INCOMES INTEREST RATE INTEREST RATE SPREAD INTEREST RATE SPREADS INTEREST RATES INTERNATIONAL BANK INTERNATIONAL CAPITAL INTERNATIONAL CAPITAL MARKETS INTERNATIONAL FINANCIAL STATISTICS INTERNATIONAL MARKETS INTERNATIONAL STANDARDS INVESTING INVESTMENT DISPUTES JUDICIAL SYSTEM LACK OF COMPETITION LAWS LEVEL OF INTEREST RATES LOAN LOANABLE FUNDS LOSS STATEMENTS MACROECONOMIC STABILITY MACROECONOMIC UNCERTAINTY MARKET PARTICIPANTS MONETARY FUND MONOPOLY MORTGAGE MORTGAGE COMPANY MORTGAGE CREDIT MORTGAGE LENDING MORTGAGE LOANS MORTGAGES MUTUAL FUND MUTUAL FUND INDUSTRY NET INTEREST MARGIN NEW ENTRANTS NONBANK FINANCIAL INSTITUTIONS OPERATING COSTS OPERATING EXPENSES OPERATING INCOME OVERHEAD COSTS POWER PARITY PRIVATE SECTOR CREDIT PRIVATIZATION PRODUCTIVITY PROFITABILITY PROPERTY RIGHTS PROPERTY RIGHTS ENFORCEMENT PROVISIONING RULES PRUDENTIAL REGULATIONS PURCHASING POWER REAL ESTATE REAL ESTATE INVESTMENT REGULATORY AUTHORITIES REGULATORY AUTHORITY REGULATORY CAPITAL REGULATORY RESTRICTIONS RESERVE RESERVE REQUIREMENTS RESERVES RESTRICTIONS ON ENTRY RETURN RETURN ON ASSETS ROA SAVINGS SAVINGS BANK SECRECY LAW SECURITIES SETTLEMENT SHARE OF ASSETS SHAREHOLDERS STATEMENT STOCK DATA SUPERVISION OF BANKS SUPERVISORY AUTHORITIES TAX TAX INCENTIVES TIME DEPOSIT TRADE SECTORS WORLD DEVELOPMENT INDICATORS |
| spellingShingle |
ACCOUNTING ACCOUNTING FRAMEWORK BALANCE SHEET BANK ASSETS BANK BRANCHES BANK LENDING BANK MARGINS BANK POLICY BANK PROFITABILITY BANK REGULATIONS BANK SECRECY BANKING INDUSTRY BANKING MARKET BANKING MARKETS BANKING SECTOR BANKING SERVICES BANKING SYSTEM BANKING SYSTEMS BANKS BORROWING BRANCH NETWORKS BROAD MONEY CAPITAL ACCOUNT CAPITAL ACCOUNT LIBERALIZATION CAPITAL MARKETS COMMERCIAL BANKS CONSUMER PROTECTION COST STRUCTURE COUNTRY COMPARISONS CREDIT BUREAUS CREDIT RISK CREDIT RISKS CREDITOR CREDITOR RIGHTS DEBIT CARDS DEPOSIT DEPOSIT INSURANCE DEPOSIT RATE DEPOSIT RATES DEPOSITORS DEPOSITS DOMESTIC BANKING ECONOMIC CRISIS ECONOMIC GROWTH ENTRY REQUIREMENTS EXTRAORDINARY INCOME FINANCIAL DEEPENING FINANCIAL INFORMATION FINANCIAL INTERMEDIATION FINANCIAL MARKETS FINANCIAL POLICIES FINANCIAL SECTOR FINANCIAL SYSTEMS FLEXIBLE EXCHANGE RATE FLEXIBLE EXCHANGE RATE REGIME FOREIGN BANK FOREIGN BANK ENTRY FOREIGN BANKS FOREIGN CURRENCY FOREIGN ENTRY FOREIGN EXCHANGE GOVERNMENT SECURITIES HOUSING INCOME GROUPS INFLATION INFLATION RATE INFORMATION ON BORROWERS INTEREST EXPENSE INTEREST EXPENSES INTEREST INCOME INTEREST INCOMES INTEREST RATE INTEREST RATE SPREAD INTEREST RATE SPREADS INTEREST RATES INTERNATIONAL BANK INTERNATIONAL CAPITAL INTERNATIONAL CAPITAL MARKETS INTERNATIONAL FINANCIAL STATISTICS INTERNATIONAL MARKETS INTERNATIONAL STANDARDS INVESTING INVESTMENT DISPUTES JUDICIAL SYSTEM LACK OF COMPETITION LAWS LEVEL OF INTEREST RATES LOAN LOANABLE FUNDS LOSS STATEMENTS MACROECONOMIC STABILITY MACROECONOMIC UNCERTAINTY MARKET PARTICIPANTS MONETARY FUND MONOPOLY MORTGAGE MORTGAGE COMPANY MORTGAGE CREDIT MORTGAGE LENDING MORTGAGE LOANS MORTGAGES MUTUAL FUND MUTUAL FUND INDUSTRY NET INTEREST MARGIN NEW ENTRANTS NONBANK FINANCIAL INSTITUTIONS OPERATING COSTS OPERATING EXPENSES OPERATING INCOME OVERHEAD COSTS POWER PARITY PRIVATE SECTOR CREDIT PRIVATIZATION PRODUCTIVITY PROFITABILITY PROPERTY RIGHTS PROPERTY RIGHTS ENFORCEMENT PROVISIONING RULES PRUDENTIAL REGULATIONS PURCHASING POWER REAL ESTATE REAL ESTATE INVESTMENT REGULATORY AUTHORITIES REGULATORY AUTHORITY REGULATORY CAPITAL REGULATORY RESTRICTIONS RESERVE RESERVE REQUIREMENTS RESERVES RESTRICTIONS ON ENTRY RETURN RETURN ON ASSETS ROA SAVINGS SAVINGS BANK SECRECY LAW SECURITIES SETTLEMENT SHARE OF ASSETS SHAREHOLDERS STATEMENT STOCK DATA SUPERVISION OF BANKS SUPERVISORY AUTHORITIES TAX TAX INCENTIVES TIME DEPOSIT TRADE SECTORS WORLD DEVELOPMENT INDICATORS International Monetary Fund World Bank Financial Sector Assessment Program Update : Republic of Kazakhstan - Bank Profitability and Competition |
| geographic_facet |
Europe and Central Asia Kazakhstan |
| description |
The purpose of this note is to explore
the reasons for a comparatively high interest rate spread in
Kazakhstan in the context of competition in the banking
sector. In spite of significant gains in efficiency made in
recent years, operational costs and provisioning for loan
losses remain high compared to some other economies.
Profitability of the aggregate banking system has increased
in the face of lower interest spreads. A highly concentrated
banking system could be an indicator of lack of competition,
but it needs to be assessed with contestability conditions
(openness to entry of banks). The lack of license
applications since 2001 raises questions about the
attractiveness of entry by new banks. Competitive and market
contestability conditions will be further enhanced with the
authorities' continuation of strong macroeconomic and
financial policies, improvements in financial sector
regulation and enforcement thus continuing the achievements
during the last five years. Administrative measures to
control interest rates (for instance, the ceiling on deposit
rates introduced by the Deposit Insurance Fund and tax
incentives) only distort financial intermediation, and are
likely to be counterproductive. |
| format |
Economic & Sector Work :: Financial Sector Assessment Program (FSAP) |
| author |
International Monetary Fund World Bank |
| author_facet |
International Monetary Fund World Bank |
| author_sort |
International Monetary Fund |
| title |
Financial Sector Assessment Program Update : Republic of Kazakhstan - Bank Profitability and Competition |
| title_short |
Financial Sector Assessment Program Update : Republic of Kazakhstan - Bank Profitability and Competition |
| title_full |
Financial Sector Assessment Program Update : Republic of Kazakhstan - Bank Profitability and Competition |
| title_fullStr |
Financial Sector Assessment Program Update : Republic of Kazakhstan - Bank Profitability and Competition |
| title_full_unstemmed |
Financial Sector Assessment Program Update : Republic of Kazakhstan - Bank Profitability and Competition |
| title_sort |
financial sector assessment program update : republic of kazakhstan - bank profitability and competition |
| publisher |
World Bank, Washington, DC |
| publishDate |
2013 |
| url |
http://documents.worldbank.org/curated/en/2004/08/18004498/kazakhstan-bank-profitability-competition-technical-note http://hdl.handle.net/10986/16064 |
| _version_ |
1764431414057500672 |
| spelling |
okr-10986-160642021-04-23T14:03:22Z Financial Sector Assessment Program Update : Republic of Kazakhstan - Bank Profitability and Competition International Monetary Fund World Bank ACCOUNTING ACCOUNTING FRAMEWORK BALANCE SHEET BANK ASSETS BANK BRANCHES BANK LENDING BANK MARGINS BANK POLICY BANK PROFITABILITY BANK REGULATIONS BANK SECRECY BANKING INDUSTRY BANKING MARKET BANKING MARKETS BANKING SECTOR BANKING SERVICES BANKING SYSTEM BANKING SYSTEMS BANKS BORROWING BRANCH NETWORKS BROAD MONEY CAPITAL ACCOUNT CAPITAL ACCOUNT LIBERALIZATION CAPITAL MARKETS COMMERCIAL BANKS CONSUMER PROTECTION COST STRUCTURE COUNTRY COMPARISONS CREDIT BUREAUS CREDIT RISK CREDIT RISKS CREDITOR CREDITOR RIGHTS DEBIT CARDS DEPOSIT DEPOSIT INSURANCE DEPOSIT RATE DEPOSIT RATES DEPOSITORS DEPOSITS DOMESTIC BANKING ECONOMIC CRISIS ECONOMIC GROWTH ENTRY REQUIREMENTS EXTRAORDINARY INCOME FINANCIAL DEEPENING FINANCIAL INFORMATION FINANCIAL INTERMEDIATION FINANCIAL MARKETS FINANCIAL POLICIES FINANCIAL SECTOR FINANCIAL SYSTEMS FLEXIBLE EXCHANGE RATE FLEXIBLE EXCHANGE RATE REGIME FOREIGN BANK FOREIGN BANK ENTRY FOREIGN BANKS FOREIGN CURRENCY FOREIGN ENTRY FOREIGN EXCHANGE GOVERNMENT SECURITIES HOUSING INCOME GROUPS INFLATION INFLATION RATE INFORMATION ON BORROWERS INTEREST EXPENSE INTEREST EXPENSES INTEREST INCOME INTEREST INCOMES INTEREST RATE INTEREST RATE SPREAD INTEREST RATE SPREADS INTEREST RATES INTERNATIONAL BANK INTERNATIONAL CAPITAL INTERNATIONAL CAPITAL MARKETS INTERNATIONAL FINANCIAL STATISTICS INTERNATIONAL MARKETS INTERNATIONAL STANDARDS INVESTING INVESTMENT DISPUTES JUDICIAL SYSTEM LACK OF COMPETITION LAWS LEVEL OF INTEREST RATES LOAN LOANABLE FUNDS LOSS STATEMENTS MACROECONOMIC STABILITY MACROECONOMIC UNCERTAINTY MARKET PARTICIPANTS MONETARY FUND MONOPOLY MORTGAGE MORTGAGE COMPANY MORTGAGE CREDIT MORTGAGE LENDING MORTGAGE LOANS MORTGAGES MUTUAL FUND MUTUAL FUND INDUSTRY NET INTEREST MARGIN NEW ENTRANTS NONBANK FINANCIAL INSTITUTIONS OPERATING COSTS OPERATING EXPENSES OPERATING INCOME OVERHEAD COSTS POWER PARITY PRIVATE SECTOR CREDIT PRIVATIZATION PRODUCTIVITY PROFITABILITY PROPERTY RIGHTS PROPERTY RIGHTS ENFORCEMENT PROVISIONING RULES PRUDENTIAL REGULATIONS PURCHASING POWER REAL ESTATE REAL ESTATE INVESTMENT REGULATORY AUTHORITIES REGULATORY AUTHORITY REGULATORY CAPITAL REGULATORY RESTRICTIONS RESERVE RESERVE REQUIREMENTS RESERVES RESTRICTIONS ON ENTRY RETURN RETURN ON ASSETS ROA SAVINGS SAVINGS BANK SECRECY LAW SECURITIES SETTLEMENT SHARE OF ASSETS SHAREHOLDERS STATEMENT STOCK DATA SUPERVISION OF BANKS SUPERVISORY AUTHORITIES TAX TAX INCENTIVES TIME DEPOSIT TRADE SECTORS WORLD DEVELOPMENT INDICATORS The purpose of this note is to explore the reasons for a comparatively high interest rate spread in Kazakhstan in the context of competition in the banking sector. In spite of significant gains in efficiency made in recent years, operational costs and provisioning for loan losses remain high compared to some other economies. Profitability of the aggregate banking system has increased in the face of lower interest spreads. A highly concentrated banking system could be an indicator of lack of competition, but it needs to be assessed with contestability conditions (openness to entry of banks). The lack of license applications since 2001 raises questions about the attractiveness of entry by new banks. Competitive and market contestability conditions will be further enhanced with the authorities' continuation of strong macroeconomic and financial policies, improvements in financial sector regulation and enforcement thus continuing the achievements during the last five years. Administrative measures to control interest rates (for instance, the ceiling on deposit rates introduced by the Deposit Insurance Fund and tax incentives) only distort financial intermediation, and are likely to be counterproductive. 2013-10-03T18:09:22Z 2013-10-03T18:09:22Z 2004-08 http://documents.worldbank.org/curated/en/2004/08/18004498/kazakhstan-bank-profitability-competition-technical-note http://hdl.handle.net/10986/16064 English en_US CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank World Bank, Washington, DC Economic & Sector Work :: Financial Sector Assessment Program (FSAP) Economic & Sector Work Europe and Central Asia Kazakhstan |