Tom coupé kse

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  • + динамика
  • Tom coupé kse

    1. 1. Trust in Banks and Implications for Savings Behaviour Tom Coupé Kyiv Economics Institute at the Kyiv School of Economics www.kse.org.ua
    2. 2. Outline <ul><li>Trust in Banks </li></ul><ul><ul><li>An international comparison of the trust in banks </li></ul></ul><ul><ul><li>Some details on trust in banks in Ukraine </li></ul></ul><ul><ul><li>Why is trust in banks important and what are the consequences of a lack of trust? </li></ul></ul><ul><ul><li>What can explain the variation in trust over countries? </li></ul></ul><ul><li>Mattresses versus Banks </li></ul><ul><ul><li>Can lack of trust explain why Ukrainians save under the Mattress? </li></ul></ul>
    3. 4. Confidence in Financial Institutions (Gallup,2009)
    4. 5. Lesson I <ul><li>Lots of variation over countries </li></ul><ul><li>Ukraine scores really bad, Belarus scores average </li></ul><ul><li>Source: https://worldview.gallup.com/default.aspx </li></ul>
    5. 6. Trust in Banks and Financial Institutions (LITS, 2006)
    6. 7. Trust in Banks and Financial Institutions (LITS, 2010)
    7. 8. Macro Lessons <ul><li>Lots of variation over countries </li></ul><ul><li>Ukraine scores really bad, Belarus scores average </li></ul><ul><li>Stability in Belarus, changes in Ukraine </li></ul><ul><li>Sources: </li></ul><ul><li>http://www.ebrd.com/pages/research/analysis/publications/transition.shtml </li></ul><ul><li>http://www.ebrd.com/pages/research/publications/special/transitionII.shtml </li></ul>
    8. 9. GFK - Trust towards different institutions: dynamics In 2007 the trust to banks was higher than to militia. It was then followed by sharp decline in 2008. In 2009 the trust to banks is gradually reviving
    9. 10. Trust Towards Different Institutions – Ukraine versus Belarus <ul><li>Ukraine </li></ul><ul><li>Trust No Trust </li></ul><ul><li>Banks: 22.3 56.2 </li></ul><ul><li>Government: 23.5 57.0 </li></ul><ul><li>Religion: 40.3 31.2 </li></ul><ul><li>Belarus </li></ul><ul><li>Trust No Trust </li></ul><ul><li>Banks: 50.2 23.9 </li></ul><ul><li>Government: 49.9 25.3 </li></ul><ul><li>Religion: 47.9 22.3 </li></ul>
    10. 11. Macro Lessons <ul><li>Lots of variation over countries </li></ul><ul><li>Ukraine scores really bad, Belarus scores average </li></ul><ul><li>Stability in Belarus, changes in Ukraine </li></ul><ul><li>In Ukraine, little trust in any institution – Belarus moderate trust in most institutions </li></ul><ul><li>Why determines trust? </li></ul>
    11. 12. Existing studies <ul><li>Mosh and Prast (2008) </li></ul><ul><ul><li>Netherlands </li></ul></ul><ul><li>Knell and Sixt (2009) </li></ul><ul><ul><li>Austria </li></ul></ul><ul><li>Mudd and Nalev(2009) </li></ul><ul><ul><li>Hungary </li></ul></ul>
    12. 13. Confidence In National Government (Gallup 2009)
    13. 15. What Explains The Variation in Trust in Banks over Countries? <ul><li>Institutional framework </li></ul>
    14. 17. What Explains The Variation in Trust in Banks over Countries? <ul><li>Institutional framework </li></ul><ul><li>Historical trauma </li></ul>
    15. 18. Trust and Economic Growth
    16. 19. What Explains The Variation in Trust in Banks over Countries? <ul><li>Institutional framework </li></ul><ul><li>Historical trauma </li></ul><ul><li>Economic Situation </li></ul>
    17. 20. Regulation
    18. 21. What Explains The Variation in Trust in Banks over Countries? <ul><li>Institutional framework </li></ul><ul><li>Historical trauma </li></ul><ul><li>Economic Situation </li></ul><ul><li>Regulation? </li></ul>
    19. 22. Summarizing So far <ul><li>Lots of Variation in Trust, Ukraine scores particularly bad </li></ul><ul><li>Trust in Banks is important  support economic growth </li></ul><ul><li>Trust in banks can be supported through </li></ul><ul><ul><li>Improved institutional environment </li></ul></ul><ul><ul><li>Avoiding ‘trauma’ (credible deposit insurance) </li></ul></ul><ul><ul><li>Economic success </li></ul></ul><ul><ul><li>Regulation? </li></ul></ul><ul><li>Why does it matter? </li></ul>
    20. 25. Why does it Matter? GFK - Overall importance : dynamics % of all respondents, September 2008 (N=1000); March 2009 (N=1000); September 2009 (N=1000).
    21. 26. Trust and Deposit flows
    22. 27. Data <ul><li>2010 FINREP – USAID survey on pension reforms </li></ul><ul><li>“ Could you, please, tell whether you personally, not a member of your family, are using any of these methods of saving and augmenting money now?” </li></ul><ul><li>Source:http://www.finrep.kiev.ua/download/pension_survey_22jul2010_en.pdf </li></ul>
    23. 33. Adding Additional Variables <ul><li>settlement type matters for current </li></ul><ul><li>richer people tend to be less likely to save in cash </li></ul><ul><li>less aware about financial markets, more likely to save in </li></ul><ul><li>education insignificant </li></ul><ul><li>self- employed being less likely and students more likely to choose for cash </li></ul><ul><li>age does not have a significant effect. </li></ul><ul><li>males are somewhat more likely to have current savings under their mattress </li></ul>
    24. 36. Why Do Banks Need Deposits - Banks’ Roles in the Economy <ul><li>Banks transform the maturity of assets, transforming relatively short-run deposits into long term financial assets </li></ul><ul><li>Banks act as delegated monitors and ensure that firms use the resources allocated to them effectively. </li></ul><ul><li>Banks can help overcome asymmetric information problems by forming long-lived relationships with firms. </li></ul><ul><li>They also play an important role in sharing risk in the economy by diversifying and smoothing fluctuations over time. </li></ul>
    25. 37. Macro Lessons <ul><li>Situation </li></ul><ul><ul><li>Lots of variation over countries </li></ul></ul><ul><ul><li>Ukraine scores really bad, Belarus scores average </li></ul></ul><ul><ul><li>Stability in Belarus, changes in Ukraine </li></ul></ul><ul><ul><li>In Ukraine, little trust in any institution – Belarus moderate trust in most institutions </li></ul></ul><ul><li>Implications </li></ul><ul><ul><li>Keeps people from using bank services </li></ul></ul><ul><ul><li>Keeps deposits out of the banking system </li></ul></ul><ul><ul><li>economic growth </li></ul></ul>

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