The Financial Corporations Sector - PowerPoint Presentation

1. The Financial Corporations Sector, its subsectors and Institutional UnitsSTATE STATISTICAL COMMITTEE OF AZERBAIJAN REPUBLICIstanbul, May 6-8, 2015

2. Financial Corporations SectorThe financial corporations sector includes all resident corporations whose principal activity is providing financial services including financial intermediation, insurance andpension fund services, and units that provide activities thatfacilitate financial intermediation. In addition, the sectorincludes NPIs engaged in market production of a financialnature such as those financed by subscriptions fromfinancial enterprises whose role is to promote and serve theinterests of those enterprises.(Item 4.29, SNA 2008).2

3. Subsectors of Financial Corporation Sector in SNA 1993S.121 Central bankS.122 Other deposit organizationsS.123 Other financial intermediaries, other than insurance corporations and pension fundsS.124 Auxiliary financial unitsS.125 Insurance corporations and pension funds3

4. Subsectors of Financial Corporation Sector in SNA 2008Subsectors in SNA 1993Subsectors in SNA 2008Central bankS.121S.121Central Bank Other deposit organizationsS.122S.122Deposit-taking corporations except the Central BankS.123Money market funds (MMF)Other financial intermediaries, other than insurance corporations and pension fundsS.123S.124Non-MMF investment fundsS.125Other financial intermediaries except insurance corporations and pension funds (ICPF)Auxiliary financial unitsS.124S.126Financial auxiliariesS.127Captive financial institutions and money lendersInsurance corporations and pension fundsS.125S.128Insurance corporationsS.129Pension fundsHolding companies (from S.11)4

5. Subsectors of Financial Corporation Sector in Azerbaijan, in accordance with SNA 2008S.121 Central BankS.122 Deposit-taking corporations except the Central BankS.125 Other financial intermediaries except insurance corporations and pension fundsS.126 Financial auxiliariesS.127 Captive financial institutions and money lendersS.128 Insurance corporations5

6. CodeSubsectorInstitutional Units Type of Activity Codes under NACE rev.2S 121Central BankCentral Bank of the Republic of Azerbaijan6411S 122Deposit-taking corporations except the Central BankCommercial banks, credit unions6419S 125Other financial intermediaries except insurance corporations and pension fundsLeasing companies 6491S 126Financial auxiliariesBroker's offices, stock exchanges, investment companies, etc.6499, 661, 662, 663Distribution of Institutional Units Operating in Azerbaijan by Subsectors of Financial Corporation Sectors6

7. CodeSubsectorInstitutional Units Type of Activity Codes under NACE rev.2S 127Captive financial institutions and money lendersNon-bank credit organization, microfinance institutions, organizations through which the government credit programs are implemented, pawnshops6492S 128Insurance corporationsInsurance organizations, deposit insurance fund651, 652Distribution of Institutional Units Operating in Azerbaijan by Subsectors of Financial Corporation Sectors7

8. The output of Central Bank (CB) is divided into: market output;non-market output.The CB output is calculated in two stagesCentral Bank output8

9. At the first stage, the CB total output on expenses is calculated based on data reflected in the CB profit and loss statement by the following items of operating expenses:paid fee;staff maintenance expenses;operating expenses;depreciation on fixed assets and intangible assets;expenses related to production and delivery of banknotes and banking documents;other expenses.Central Bank output, continuation9

10. Commission fees and other incomes are considered as market output of the Central Bank.CB non-market output is calculated as a difference between total output and market output. Market output of the Central Bank is used as intermediate consumption by other financial corporations as well as by units of general government and non-financial corporation sectors.Non-market output of the central bank is shown in secondary distribution of income account as a current transfer from the financial corporation sector to general government sector.Central Bank output, continuation 10

11. Output of credit organization services consists of two types of services:Financial services to be provided for a fee explicitly;Financial Intermediation Services Indirectly Measured (FISIM). Credit Organization Services output11

12. Data sources:Consolidated profit and loss statement of commercial banks (Central Bank);Consolidated balance sheet of commercial banks (Central Bank);Data on credit and deposit rates (Central Bank);Data of statistical form No.2-bank “On main indicators of financial and economic activity of financial and credit organizations”. Credit Organization Services output, continuation12

13. Output of services to be provided for a fee explicitly is calculated by summing up following statement profit and loss items:Incomes of account management;Fee income from providing of other services;Other operating income. Credit Organization Services output, continuation13

14. Output of Financial Intermediation Services Indirectly Measured (FISIM) is calculated using standard formula below: FISIM = [(rL – rr) x yL] + [(rr – rD) x yD] , where yL – average credit balance for accounting period;yD –average deposit balance for accounting period,rL – loan rate,rD – deposit interest rate ,rr – base interest rate. Credit Organization Services output, continuation14

15. Base rate is calculated using data on balances and interest rates on credits and deposits of legal entities and individuals in national and foreign currencies; There are calculated two reference rates by cash assets in national currency and cash assets in foreign currencyBase rates are calculated as weighted average of credits and deposits rates. Credit Organization Services output, continuation15

16. FISIM is distributed by institutional sectors and subsectors proportionally to the annual average of credits and deposits balance, based on data provided by the Central Bank; The FISIM export and import indicators are not calculated yet due to insignificant share of credits and deposits external transactions and lack of required information. Credit Organization Services output, continuation16

17. Output of insurance services consists of following types of insurance services:direct insurance services;including:life insurance;non-life insurance; reinsurance services. Insurance Services output17

18. Data source:Data of statistical form No.1-insurance “On activity of insurers (reinsurers) and insurance brokers having the corporate status”Data of the State Agency for Insurance Supervision (Ministry of Finance) Insurance Services output, continuation18

19. Insurance Services output, continuationOutput of non-life insurance services is calculated using formula below:Actual earned premiumsplus additions to the premiumsminus adjusted payable insurance compensationwhere adjusted payable insurance compensations are assessed based on the analysis of insurance compensations data for the last 5-7 years. 19

20. Insurance Services output, continuationOutput of life insurance services is calculated as follows: Actual earned premiumsplus additions to the premiumsminus payments with expiring due date minus increase (plus decrease) of life insurance reserve funds Output of reinsurance services is calculated using the same formula as for direct insurance 20

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