Importance The Russian consumer lending market has been rapidly growing since the middle of 2000 and is associated with high risks. These risks are typical of both the retail banks and individual borrowers, who inadequately assess loan terms. The market regulation started in 2008, when the concept of effective interest rate (full cost of loan) was introduced. Objectives The purpose of the study is to evaluate the efficiency of regulation of effective interest rates on consumer loans through the analysis of changes in the retail banking market structure for 2013–2017. Methods I apply methods of statistical analysis to review financial statements of banks in the open databases of the Bank of Russia. The parameters of the consumer lending market for 2013 are calculated under my own method, using the dynamic processes modeling and regression and correlation analysis. Results I built a dynamic model of the consumer lending market structure from June 2013 to December 2016 in the context of effective interest rate range. The results were compared with the values of banks' revenues from retail lending. The paper includes the analysis of changes in retail banks’ capital adequacy as a result of toughening the requirements of the Bank of Russia to cover the risks of costly retail loans with equity. Conclusions and Relevance The findings are indicative of highly efficient regulation of the effective interest rate on consumer loans and profound changes in the Russian retail banking market over the period under investigation.
Keywords: effective interest rate, capital adequacy, dynamic process, regression analysis
References:
Ivanov O.M., Shcherbakova M.A. Kommentarii k Federal'nomu zakonu “O potrebitel'skom kredite (zaime)”: nauchno-prakticheskii [Scientific and practical comments on the Federal Law “On consumer credit (loan)”]. Moscow, Statut Publ., 2014, 767 p.
Mezhdunarodnoe i zarubezhnoe finansovoe regulirovanie: instituty, sdelki, infrastruktura: monografiya: v 2 ch [International and foreign financial regulation: Institutions, transactions, infrastructure: a monograph: in 2 parts]. Moscow, KnoRus, TsIPSiR Publ., 2014, part 2, 640 p.
Stepanova O.A., Orlova S.A., Shportova T.V. [Consumer lending in Russia: Problems and solutions]. Fundamental'nye issledovaniya = Fundamental Research, 2015, no. 2-13, pp. 2930–2932. (In Russ.)
Motovilov O.V. [On development of consumer lending]. Den'gi i kredit = Money and Credit, 2015, no. 12, pp. 21–25. (In Russ.)
Selivanova T.A. [Trends in and problems of retail bank lending in modern Russia]. Innovatsionnaya nauka = Innovative Science, 2016, no. 2-2, pp. 92–98. (In Russ.)
Sukhovskaya M.G. [Consumer loans: New rules]. Glavnaya kniga = General Ledger, 2014, no. 15, pp. 42–47. (In Russ.)
Petrov O. [Consumer lending: 2014 version]. Nalogovyi vestnik = Tax Bulletin, 2014, no. 2-3, pp. 20–29. (In Russ.)
Dimitriadi G.G. [On effective interest rate]. Bankovskoe delo = Banking, 2015, no. 1, pp. 76–78. (In Russ.)
Khromov M. Bankovskoe kreditovanie naseleniya: dolgovaya nagruzka snizhaetsya. V kn.: Operativnyi monitoring ekonomicheskoi situatsii v Rossii: tendentsii i vyzovy sotsial'no-ekonomicheskogo razvitiya [Consumer lending: Debt load is reduced. In: Operational monitoring of economic situation in Russia: Trends and challenges of socio-economic progress]. Available at: Link. (In Russ.)
Voloshina O.B. [Banks on the verge of changes]. Vestnik Penzenskogo gosudarstvennogo universiteta = Vestnik of Penza State University, 2013, no. 3, pp. 38–42. (In Russ.)
Litvinova A.V., Ievleva A.A. [A portfolio of retail lending products: Nature, elements, principles of formation]. Teoriya i praktika obshchestvennogo razvitiya = Theory and Practice of Social Development, 2013, no. 9, pp. 270–276. (In Russ.)
Grishina C.A. [Representation of economic process as a closed-loop dynamic system and its mathematical description]. Izvestiya Tul'skogo gosudarstvennogo universiteta. Ekonomicheskie i yuridicheskie nauki = Proceedings of Tula State University. Economic and Legal Sciences, 2011, no. 1-2, pp. 89–99. (In Russ.)
Kryukov S.V., Dorofeeva K.A. [A dynamic simulation model of the consumer credit portfolio of commercial bank]. Krymskii nauchnyi vestnik, 2015, no. 6, pp. 141–150. (In Russ.) Available at: Link.
Kryukov S.V., Patrakeeva O.Yu. [On consistent time-varying tools to support decision-making in the economic system management]. Doklady Akademii nauk = Proceedings of the Academy of Sciences, 2015, vol. 462, no. 6, pp. 645–648. (In Russ.)
Puchkov V.F., Gratsinskaya G.V. Metodologiya postroeniya matematicheskikh modelei i otsenka parametrov dinamiki ekonomicheskikh system [A methodology for constructing mathematical models and evaluation of parameters of changes in economic systems]. Moscow, Kreativnaya ekonomika Publ., 2011, 240 p.
Amelin I.E. [Time-varying modeling of bank's economy]. Bankovskoe delo = Banking, 2015, no. 1, pp. 65–75. (In Russ.)
Tsar'kov V.A. [Behavior models of the economy of banks]. Audit i finansovyi analiz = Audit and Financial Analysis, 2006, no. 1, pp. 93–110. (In Russ.)
Evstaf'ev K.A. [A technology to control the liquidity of single budget account]. Vestnik BIEF = BIEF Bulletin, 2005, no. 33, pp. 34–31. (In Russ.)
Evstaf'ev K.A., Mnatsakanyan A.G. Teoriya i praktika byudzhetirovaniya v vuze v usloviyakh reformirovaniya gosudarstvennykh finansov [Theory and practice of budgeting in higher schools under the government finance reform]. Kaliningrad, KSTU Publ., 2015, 125 p.
Rechkalova E. [Retail lending under new economic conditions]. Natsional'nyi bankovskii zhurnal = The National Banking Journal, 2014, no. 13, pp. 30–31. (In Russ.)
