Proceedings of the 10th International RAIS Conference on Social Sciences and Humanities (RAIS 2018)

The Impact of Basel Standards on Financial Management: The Case of the Republic of Serbia

Authors
Ivana Marinovic Matovic
Corresponding author
Ivana Marinovic Matovic
Keywords
Basel standards, banking, capital requirements, financial management, Republic of Serbia
Abstract
The traditional role of a financial manager, based on securing sources of financing and cash management for the smooth running of a business organization, has changed significantly over the last decades. To a large extent, external factors have contributed to that; such as the globalization of financial markets, the liberalization of capital flows, changes in the macroeconomic environment, and the development of new products and services. Basel standards have a special impact on the financial management in banking organizations. Basel standards, as the basis of regulatory regimes in banking systems around the world, have especially contributed to the development and improvement of risk management and financial management processes. This paper identifies the challenges in the process of financial management in banks in the Republic of Serbia, conditioned by Basel standards, especially regarding the capital requirements. Faced with extremely strong competition and a trend of declining margins in the banking market in the Republic of Serbia, finding the way to optimize available capital is an imperative. One of the ways is the application of advanced approaches for calculating capital requirements. Through the example of capital requirements for operational risk, the paper confirms that the advanced calculation of capital requirements is one of the ways to optimize capital and its further more productive use.
Download article (PDF)