A discriminant analysis of financial soundness of deposit takers: Ukraine versus Israel case

Discriminant models for determining the financial soundness for Ukraine and Israel are discussed. These models determine the level of a financial soundness of deposit takers. In this paper The discriminant model based on twenty-four financial soundness indicators for deposit takers over the period from 2008 till 2018 is developed. Though Ukraine and Israel are unitary states, Ukraine, being an industrial and agricultural country with a predominant production of raw materials, is a dynamic industrializing country, while Israel is an industrial country that is dynamically developing, that is why, they are comparable. According to Doing Business-2018, Israel ranked the 54th in the annual rating ease of doing business, while Ukraine did the 76th. Ukraine also ranked the 77th in the ranking of Best Countries for Business (Forbes), and Israel ranked the 74th. Ukraine’s GDP was 112.2 billion USD in 2017, and Israel’s GDP was 350.9 billion USD. This fact reflects national development, progress and living standards of both states, as well as differences between them. The period from 2008 to 2018 was chosen for analysis, because it covers crisis and postcrisis periods of the world economy

A discriminant analysis of financial soundness of deposit takers: Ukraine versus Israel case

Discriminant models for determining the financial soundness for Ukraine and Israel are discussed. These models determine the level of a financial soundness of deposit takers. In this paper The discriminant model based on twenty-four financial soundness indicators for deposit takers over the period from 2008 till 2018 is developed. Though Ukraine and Israel are unitary states, Ukraine, being an industrial and agricultural country with a predominant production of raw materials, is a dynamic industrializing country, while Israel is an industrial country that is dynamically developing, that is why, they are comparable. According to Doing Business-2018, Israel ranked the 54th in the annual rating ease of doing business, while Ukraine did the 76th. Ukraine also ranked the 77th in the ranking of Best Countries for Business (Forbes), and Israel ranked the 74th. Ukraine’s GDP was 112.2 billion USD in 2017, and Israel’s GDP was 350.9 billion USD. This fact reflects national development, progress and living standards of both states, as well as differences between them. The period from 2008 to 2018 was chosen for analysis, because it covers crisis and postcrisis periods of the world economy

A Discriminant Analysis of Insurance Companies in Ukraine

Determining and forecasting the financial situation of insurance companies of Ukraine has become an important issue of financial supervision in view of the need to ensure the sustainability of the financial sector and reduce the negative impact of the insolvency of insurance companies. Given the significant number of bankruptcies of insurance companies in Ukraine in recent years, a discriminatory method may be applied to improve off-site financial supervision. The paper analyzes the advantages and disadvantages of discriminatory models developed for companies producing goods and providing non-financial services to banking institutions and insurance companies. It is substantiated that in order to improve the quality of estimation and forecasting of the financial state of insurance companies in Ukraine, the development of a discriminant model should take into account the domestic specificity of the insurance business. The scientific work defines the stages of development and testing of the quality of a discriminant model for determining the financial status of insurance companies in Ukraine. For the development of a discriminant model, taking into account the existing statistical base, 31 indicators of activity of 12 insurance companies for 2015 were selected. The selection of statistical indicators for use as factors in a discriminant model was performed on the basis of a two-choice F-test, a Farrar-Globard algorithm, a matrix of pair coefficients of correlation. A discriminatory model for determining the financial status of insurance companies in Ukraine included net returns on equity, asset turnover ratios, insurance risk rates, and changes in equity. The application of the model allows you to determine whether the insurance company has a satisfactory or unsatisfactory financial condition. Approval of the developed discriminant model has proven its high quality