Subject The article considers ratings of banks' reliability. Objectives The aim is to evaluate the accuracy of existing methodology for bank reliability assessment based on official reporting, to identify patterns between indicators and factors that can affect the financial sustainability of a bank. Methods The study draws on the comparative analysis of key indicators of bank's financial statements one year prior to the introduction of provisional administration, and evaluates the results of existing methods for analyzing the financial standing of banks. Results The findings show that those methods that use only official reporting to assess the reliability of banks are not sufficient for short-term forecasting of financial stability. Ratings of the majority of agencies that rest on official reporting have a high percentage of erroneous results, therefore, rating agencies are not able to predict the regulator's decisions regarding a credit institution. Conclusions Currently, there are no universal methods to determine reliability, which would provide a correct forecast of deteriorated financial position of the bank. It is important to use a systems approach, where financial reporting is not a key component.
Keywords: bank, reliability, capital adequacy, provisional administration, statutory reporting
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