Revista Tinerilor Economiºti (The Young Economists Journal)

Revista Tinerilor Economişti (The Young Economists Journal)
72.3% of credit risk, while the volatility of CPI variation explained 52.7% of credit risk.
This is explained by the fact that the bulk of the loans offered by our banking system
are in euro and it is evident that a portion of borrowers Albanians have a mismatch
between the credit and currency inflows of income. Reports “unhedged” have been
3.74%, 5.7% and 9.6% respectively for the years 2007, 2008 and 2009. Albanian
borrowers have preferred this option because of lower interest rates in euro loan and
trust for greater durability of the euro. This has led to greater impact and assessment of
the euro in the deterioration of portfolio quality banking system. Therefore we conclude
that the banking system is highly exposed to exchange rate volatility ALL/EUR, with
directly affects the quality of our banking loan portfolio. For this reason, banks should
implement a more balanced policy lending by increasing the share of loans in national
currency. They can give loans in EURO to persons who have income flowing to the
euro. It should also managed to net foreign exchange position of banks’ balance sheets,
which is currently low value, significantly limiting the size of possible losses.
One other important factor that can affect the credit quality of the banking
portfolio price is volatility of real estate. A reduction in the price of real estate affects
the collateral value of real estate loans, exposing banks to big losses. U.S. credit crunch
should be taught to our bankers. They need to give important qualitative analysis of the
borrower, assessing current flows and future cash should not rely solely on physical
collateral. Growth of loans to real estate and its dominance to total loans exposes banks
to risk real estate depreciation.
Based on the forecasts of macroeconomic indicators expected deterioration of
portfolio quality indicators banking. Therefore, banks seem to establish sufficient
reserves for the risk of loan losses. Relying on the portfolio of loans banks have to
identify clients with problems of temporary and surmountable by creating policies to
support and increase the likelihood of payment. As for clients who are assessed with
low chance of repayment of the loan, banks must follow legal procedures for the
execution of guarantees and collateral to recover a greater amount of the loan. For new
loans based on the experience of banks with problems faced in the loan portfolio and
the reasons it is necessary to have a better distribution sector and a more reasonable
balance between public and private project, and between business enterprises or
families, between forms of giving credit in ALL or in foreign currency etc. being
directed lending in order to minimize the exposure of banks to more problematic forms
and low concentration in its entirety.
The results of our analysis may be applicable to other financial institutions,
insurance companies, pension funds etc. the risk management of their financial
investments. They may be applicable to special economic sectors, e.g. analysis can be
made of the impact of macroeconomic factors in sector loans to trade, or construction,
etc. They may be applicable to the loan portfolio by currency, e.g. analysis can be made
of the impact of macroeconomic factors on credit loans in foreign currency or ALL. Or
the results of our analysis may be applicable to the loan portfolio by purpose of use,
analysis can be made of the impact of macroeconomic factors in credit loans for real
estate, and finally the results of our analysis may be applicable to the loan portfolio by
subject, business or individual, according to the schedule, etc.
Since the banking system appeared positive feedback on the macroeconomic
situation in the country, banks should stress the stress-test analysis. This analysis
assesses the various scenarios the main macroeconomic indicators and based on the
probability of occurrence of these scenarios take measures to cope with the loss of
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