When using an embedded processor's hardware implemented UART, it is often the case that the rate at which the software processes the data is a fraction of the Gross bit rate some times referred to as the Baud rate. If the UART is configured to handle 8 bit RS-232 where the Gross bit rate is 10000 bits per second, the processor only has to handle data at a faction of that rate. Perhaps 1/10 given several bits of over head and space between characters.
Processor intervention can be further reduced if the hardware UART contains several bytes of buffering. For every doubling of the number of hardware supported bytes of buffering, processor interventions events are cut in half.
Beyond this, there are embedded processors in which the UART supports DMA or Direct Memory Accessing. This is where the hardware UART will write the received data directly into the processor's memory with out need of processor intervention. This feature is usually only found on feature rich embedded processors.
Study this PDF to understand the abilities and limitations of the ATmega32 processor. Specifically the USART section starting on page 140.