Dynamic balance model of financial flows between the institutional sectors in the regional system

I. V. Naumov 

I . V. Naumov / News of the Ural State Mining University 3 (2018) 155-164

Purpose of the work is search for general trends and problems of the development of the banking sector of the Sverdlovsk region in different time cycles of the economic dynamics of 1999–2017; it is based on the balance model of financial flows between the institutional sectors in the regional system and the identification of priority areas for the financial strategy for the development of the banking sector in the region.
Methodology. The methodological basis of the study is the methodology for creating a balance model of financial flows between the banking and institutional sectors of the economy (households, financial and non-financial corporations, public administration sector and the rest of the world management), the formation of which is based on the principles of “double entry”.
Results. In this paper, we give the analysis of the trajectories of financial flows characteristic of different economic development cycles between institutional sectors in the regional system for such financial tools as cash, deposits, lending, debt securities, and so on. The analysis has shown that almost all institutional sectors have been withdrawn money from the banking sector during the crisis; the banking sector, in turn, has carried out speculation with foreign currency, placed funds into deposit accounts of foreign financial institutions, lent to foreign organizations of large amounts of money (more than to the domestic real sector of economy), invested in debt foreign securities instead of lending to the real sector of the economy. It is justified that in order to stabilize the economic situation of the institutional sectors in the region, withdrawal of the Russian economy from protracted stagnation, it is necessary to change the policy pursued by the banking sector and the Central Bank of Russia. The consolidation of the current development strategy for the banking sector of the Russian Federation for the period 2019–2021 is proposed, as well as measures to support financial institutions investing in the real sector of the economy and the public sector with all possible financial tools; moreover, it is necessary to impose sanctions on those Russian credit institutions that invest in debt foreign securities, lend to foreign institutions and place funds into their deposit accounts.

Keywords: regional economy, financial strategy, balance model of financial flows, banking sector.

The paper was prepared in accordance with the research project plan of the Federal Publicly Funded Institution of Science of the Institute of Economics of the RAS Ural branch for 2017-2019.

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