G24 - Investment Banking; Venture Capital; Brokerage; Ratings and Ratings AgenciesReturn

The discussion paper focuses on the prerequisites for the creation, development and consequences of exchange traded funds. The article first analyzes the defining characteristics of the effective behavior of stock markets as an elementary prerequisite for the investment demand for passive portfolio management. Subsequently, attention is paid to the nature of exchange traded funds and their rapid development in recent decades. Individual types of exchange traded funds are also analyzed. In the final part of the paper, some risks of the rapid development of this financial innovation, which significantly changes the focus of investment management, both individual and institutional, are discussed.

The discussion paper focuses on the identification of the main reasons for the weak position of the stock exchange market in the Austrian economic system. The introductory part of the paper is based on an examination of the reasons for the establishment of the Vienna Stock Exchange. The following part of the article focuses on the boom, which ended in a stock market crash in 1873. This stock market crash significantly affected the Vienna Stock Exchange market in the following decades. Attention is also paid to the development of the Vienna Stock Exchange after the collapse of the Austro-Hungarian monarchy. The final part of the paper discusses the causes of long-term stagnation of the Vienna stock market.

The discussion paper focuses on the identification of the main reasons for the weak position of the stock exchange market in the Czech economic system. The introductory part of the article discusses the structure of the stock exchange market and its position. Attention is also paid to the impact of voucher privatization on the functioning of the Czech stock exchange market. The following part of the paper discusses the stock exchange market restrictions in the universal banking model. In the following part, the missing stock exchange market engine is identified, which in our opinion is a sufficiently capitalized pension pillar focused on investing in domestic equity instruments. Attention is also paid to the negative impact of inadequate regulation at various stages of the development of the investment environment. The final part of the paper discusses not only unsuccessful efforts to develop the stock exchange market, but also discusses ideas for increasing the importance of the stock exchange market in the Czech economy.

The aim of this paper is to summarize results of modern investigation of Basel III impact. In order to do so, the author has analyze methodology of more than thirty studies focused on the impact of increased capital adequacy, adopted under Basel III framework, on the lending activity of commercial bank. The paper presents main methodology within both macro and microeconomic approach. Complex macroeconomic models simulate impact of increased bank's equity on profit function of the bank considering at the same time changes of total risk weigheted assets or banks' balance structure. Within the microeconomic approach, the paper puts emphasis on CAPM, as a most widely established methodology, and assumptions formed about the real M-M effect for banks. As a result, the paper brings an evidence of consensus about mainly marginal efect of increased equity of commercial banks on lending spreads within vast majority of existing studies. The important factor to consider is the lenght of the implementation period. In the long-term there is expected no significant effect of increased equity on loans pricing. Somewhat bigger differences remains as for impact of higher equity on loan volume. Differences between estimated impact on loan volume roots mainly in different assumptions about elasticities of loan demand and cost of access to new equity considered within scenarious adopted by the studies.

The article deals with theoretical and practical dimension of the third generation of Basel regulatory standards. The implementation proves more complex than previously supposed. Modern bank regulation theory focus mainly on four areas: factors that lies beyond bank equity pricing, transmission channels of banking crisis on the international level, optimal design of the safety net, well-balanced intensity of regulatory restrictions. Unfortunately, in the real world, bank regulation standards do not often follow the recommendations of economic theory. The rules remain to be subject of policy influence of diverse advocacy groups including banks themselves. The aim of this article is to outline the main ways of actual economic research and the challenges that lie ahead. Special attention is paid to such issues as capital adequacy, moral hazard and tax distorsion of debt financing. The influence of increased capital adequacy requirements, actual income tax policy and deregulation on the stability of commercial banks is being questioned within the study.

This paper surveys the regulatory response to the global financial crisis with an emphasis on the regulation of the proprietary trading by banks with the speculative investment instruments. We discuss not only changes in the US regulation, but we also focus on the implementation of the Vickers rule in the Great Britain. The Dodd-Frank Act introduced quite promptly sensitive regulation of the proprietary trading by banks. Regulatory response to the global financial crisis changed significantly the regulatory-supervisory approach to the EU banks as well. However, the proposal new European directive on structural measures increasing the resistance of the banks has a very restrictive nature, because it surprisingly connects both Volcker and Vickers rule.

A research task, the results of which have been summarized in the article, solved a partial issue of the venture capital and tested an assumption on higher frequency of the growth of the quantity "employee efficiency" compared to the frequency of the growth of the number of employees working in the companies with venture capital funding. Methods of descriptive statistics were primarily employed to carry out the empirical research. Having surveyed the whole file of monitored companies the fact was found out that 63% of companies indicated higher frequency of the growth of the quantity "employee efficiency", in 23% of companies higher frequency of the growth of quantity "number of employees" was reported. Monitoring of the change of employee efficiency and number of employees in the year preceding the entry of investor and in the first year of the venture capital investor participation revealed that in 57% of companies the employee efficiency decreased, and in 61% of companies the number of employees decreased. Another level of the research was represented by the comparison of the frequency of growth of monitored quantities during the co-operation of companies with their investors and after the exit of such investors. The knowledge was acquired that in the Czech companies with venture capital involvement the efficiency of their employees increased more significantly as compared to their numbers, not only in the period of participation of investors, but also after their exit.

Churning is one of the unethical practices used by brokers while trading in a customer's account. It consists in an excessive trading in a customer's account that is disadvantageous for the client. This technique is described in more details in the field of non-leverage financial instruments, including quantitative indicators. The aim of this paper is to clarify the differences between the leverage and non-leverage financial instruments in terms of trading volume measurement methods for churning's assessing. The author concludes that the churning assessment has to be based on consistency of number and characteristics of the trades with the investor's strategy. Difference among derivative contracts does not provide single quantitative indicators that could indicate churning by trading of the derivative. It would be possible to use quantitative indicators only for comparing the same type of investment instrument, investment strategy and especially of the same leverage.

In this article is analyzed duration as a measure of interest risk of bonds. We study significant factors which influence on highness of duration and also price chance of bonds. We discuss different ways to calculate duration and also we try to show its importance to management of bonds portfolio.