Finance and Credit

Abstracting and Indexing

Referativny Zhurnal VINITI RAS
LCCN Permalink
Google Scholar

Online available



Cyberleninka (12 month OA embargo)

Evaluation of commercial bank's optimal debt capital as a signal effect and a source of information in the financial market

Vol. 24, Iss. 11, NOVEMBER 2018

Received: 17 July 2018

Received in revised form: 31 July 2018

Accepted: 14 August 2018

Available online: 29 November 2018

Subject Heading: Banking

JEL Classification: G21, G32

Pages: 2553–2567

Evdokimova S.S. Volgograd State University, Volgograd, Russian Federation

ORCID id: not available

Bondarenko S.A. National Research University – Higher School of Economics, Moscow, Russian Federation

ORCID id: not available

Subject The article analyzes the formation and substantiation of optimal debt load of a credit and financial institution under various methods considering the specifics of banking operations in the financial market.
Objectives The aim is to scrutinize the specificity of debt load calculation by a credit institution, review methods of debt load optimization on the PAO VTB case, give recommendations on streamlining the methodology for optimal debt burden calculation to maximize the value of the institution.
Methods We test basic methods for evaluation of optimal debt capacity of a credit and financial institution, like weighted average cost of capital, capital asset valuation, EBIT volatility, and the adjusted present value (APV) method.
Results The findings enable to take into account the specifics of bank's operating activities, limit the number of methodological approaches to determining the optimal debt capacity of the credit institution.
Conclusions The choice of capital structure may have a signal effect on market players: an increase in the loan capacity indicates a potential for profitability growth and big cash flows generation; an increase in equity implies current problems with regulatory requirements for capital adequacy ratio calculation and bank management attempts to reduce the cost of financial difficulties. The optimal level of debt burden can be used by managing credit and financial organizations to make more flexible decisions in the financial market (policy of payments to owners, implementation of investment projects with numerous internal risks, decisions about reorganization, mergers and acquisitions).

Keywords: optimal capital structure, financial and credit institution, debt load, financial leverage


  1. Gorbunova N.A., Ivanova N.V. [Business valuation of a joint-stock company based on the WACC method]. Molodoi uchenyi = Young Scientist, 2013, no. 9, pp. 173–175. URL: Link (In Russ.)
  2. Zadorozhnaya A.N. [The procedure for applying the EBIT volatility method and the EBIT-EPS analysis model in the financial decision-making process]. Finansovaya analitika: problemy i resheniya = Financial Analytics: Science and Experience, 2015, vol. 8, iss. 36, pp. 24–37. URL: Link (In Russ.)
  3. Teplova T.V., Getalova A.A. [Use of borrowed capital: Company's optimum leverage: from theoretical concepts to practical model justifications]. Upravlenie korporativnymi finansami = Corporate Finance Management, 2013, no. 5, pp. 262–279. URL: Link (In Russ.)
  4. Zadorozhnaya A.N. [Optimal leverage: The comparison of WACC model and EBIT volatility method]. Innovatsionnaya ekonomika i obshchestvo, 2014, no. 4, pp. 45–54. (In Russ.)
  5. Zadorozhnaya A.N. [Procedure for determining company's debt load]. Finansovaya analitika: problemy i resheniya = Financial Analytics: Science and Experience, 2014, vol. 7, iss. 48, pp. 39–50. URL: Link (In Russ.)
  6. Lisovskaya I.A., Mamedov T.S. [The model of capital asset valuation as a tool for discount rate evaluation]. Rossiiskoe predprinimatel'stvo = Russian Journal of Entrepreneurship, 2016, vol. 17, no. 7, pp. 937–950. (In Russ.) URL: Link
  7. Khametshin D.R. [On using the asset pricing models in the analysis of efficiency of real investment]. Rossiiskii ekonomicheskii internet-zhurnal, 2009, no. 4, pp. 967–980. (In Russ.) URL: Link
  8. Kokoreva M.S., Stepanova A.N. Financial architecture and corporate performance: Evidence from Russia. Korporativnye finansy = Journal of Corporate Finance Research, 2012, vol. 6, no. 2, pp. 34-44. URL: Link
  9. Suvorova L.E., Suvorova T.E., Kuklina M.V. [Analysis of models for assessing the cost of capital]. Vestnik Nizhegorodskogo universiteta im. N.I. Lobachevskogo. Seriya: Sotsial'nye nauki = Vestnik of Lobachevsky State University of Nizhny Novgorod, 2016, no. 1, pp. 38–47. URL: Link (In Russ.)
  10. Dorogan N.D., Chernenko V.A. [The capital structure optimization concept: A new approach to research]. Teoriya i praktika servisa: ekonomika, sotsial'naya sfera, tekhnologii, 2014, no. 3, pp. 39–44. URL: Link (In Russ.)
  11. Romanyshin V.O., Rovnyi Ya.A. [Evaluation of Financial Resources in Domestic Joint-Stock Companies]. Vestnik Sibirskogo universiteta potrebitel'skoi kooperatsii = Bulletin of Siberian University of Consumer Cooperatives, 2014, no. 3, pp. 60–68. (In Russ.)
  12. Burkhanova A.A., Enkov V.V., Korotchenko D.A. et al. [Dynamic trade-off theory of capital structure: An overview of recent research]. Korporativnye finansy = Journal of Corporate Finance Research, 2012, vol. 6, no. 3, pp. 70–86. (In Russ.) URL: Link
  13. Bolkvadze M.E., Busalova A.D. [A value-based approach to enterprise management]. Sovremennye tendentsii v ekonomike i upravlenii: novyi vzglyad = Modern Trends in Economy and Management: A Fresh Approach, 2016, no. 41-1, pp. 8–14. (In Russ.)
  14. Lavrukhina N.V. [Optimization techniques prices and capital structure organization]. Upravlenie ekonomicheskimi sistemami: elektronnyi nauchnyi zhurnal, 2014, no. 6, pp. 13. (In Russ.) URL: Link
  15. Zhukov P.E. [Model of accounting the probability of default for calculation of WACC and determination of optimal capital structure]. Nauka i mir = Science and World, 2014, vol. 2, no. 3, pp. 49–50. (In Russ.)
  16. Evdokimova S.S., Tolstopyatyi S.A. [The innovative technologies as factor of bank competitiveness]. Fundamental'nye issledovaniya = Fundamental Research, 2015, no. 12-5, pp. 1012–1016. URL: Link (In Russ.)
  17. Zhukov P.E. [Finding an optimal capital structure under Default Risk]. Nauchno-issledovatel'skii finansovyi institut. Finansovyi zhurnal = Financial Research Institute. Financial Journal, 2015, no. 2, pp. 60–72. URL: Link (In Russ.)
  18. Evdokimova S.S., Mokhova O.V. [Optimizing the cost of developing and implementing innovative types of remote banking services]. Vestnik Astrakhanskogo gosudarstvennogo tekhnicheskogo universiteta. Seriya: Ekonomika = Vestnik of Astrakhan State Technical University. Series: Economics, 2017, no. 3, pp. 128–136. URL: Link (In Russ.)

View all articles of issue


ISSN 2311-8709 (Online)
ISSN 2071-4688 (Print)

Journal current issue

Vol. 25, Iss. 4
April 2019