An Appreciation of the Impact of the Development of Financial Markets on Financial Decisions made by Corporations in the Czech Republic

Polak, Petr. (2005) An Appreciation of the Impact of the Development of Financial Markets on Financial Decisions made by Corporations in the Czech Republic. Investment Management and Financial Innovations 2::pp. 8-17.

Abstract

The article attempts to evaluate the main influences on how money and capital markets have affected corporate finance and treasury in the Czech Republic. There are 5 primary factors identified, which at various times have been suspected of exerting significant influence over corporate financial decisions, i.e.: tax system evolution, interest rates changes, legislative framework, competitive environment in the sector of financial intermediates, pressure from the corporations on the banks towards improved quality of the treasury products offered (this article focuses on the influence of 3 of them). Recent changes in Czech financial markets have had a lasting impact on both financial intermediaries and corporate finance departments and treasuries. And many more changes may be expected to occur in the future, especially in connection with Czech Republic European Union accession in May 2004, and its subsequent incorporation into the Eurozone.