SVOP KAO INSTRUMENT UPRAVLJANJA TRŽIŠNIM RIZICIMAU TRANZICIJSKIM ZEMLJAMA/ SWAP AS FINANCIAL MARKET RISK MANAGEMENT IN TRANSITION COUNTRIES

Abstract

In conditions of globalisation and deregulation, banking business has become very risky. Turbulant environment especially apostrophized the meaning of managing the market risk – intrest rate risk, exchange rate risk and risk of changing asset price. Investors (banks) make decisions about modalities and risk managment techniques.The choice ranges from the simple assessment and monitoring of risk, and sophisticated models to specific banking techniques that allow the transfer of risk to the other side. Swap operations belong to this third category. They allow the transfer of market risk to a counterparty in the effective ALM approach. Swap operations are particularly well developed in countries with developed financial infrastructure, but some forms of swap transactions are created in countries in transition. In the first part of this work, the attention was focused on the basic determinants of swap transactions. In the second part, the focus of analysis is on modalities of swap
transactions, with emphasis on the basic advantages which some swap jobs offer banks, especially in terms of reducing borrowing costs. In the third part, review was given on the practice of using swap arrangement in the countries in transition. The conclusion is reserved for research results.