bank_management(e)_chapter2.pptVIP

Central South University Analyzing Bank Performance - Using the UBPR(The Uniform Bank Performance Report, 统一银行业务报告) 1.Foreword 2.Balance Sheet 3.Income Statement 4.Relationship between Balance Sheet and Income Statement 5.UBPR-Return on Equity Model 6.Banking Risks and Returns 7.CAMELS Ratings 8.Performance Characteristics of Different-sized Banks 9.Financial Statement Manipulation 10.Discuss 1.Foreword From 1985 to 1990, 1,016 commercial banks failed throughout the USA, a rate of just over 169 bank failure each year. The recent trend had been quite favorable as only 55 banks failed from 1995 to 2004, or over 5 per year. 1.Foreword Questions: Can an objective observer identify problem institutions before they fail? Is it possible to distinguish between strong and weak banks on the basis of reported earnings and balance sheet figures? How should risk be measured? How can the trade-off between risk and profitability be evaluated? 2. Balance Sheet (资产负债表） It presents financial information comparing what a bank owns with what it owes and the ownership interest of stockholders. Assets = Liabilities + Equity 资产=负债+股东权益 Balance sheet figures are calculated at a particular point in time and thus represent stock values. Balance Sheet (assets): PNC and Community National Bank Bank Assets Cash and due from banks Vault cash (库存现金), deposits held at the Fed and other financial institutions, and cash items in the process of collection. Loans The major asset, generate the greatest amount of income, exhibit the highest default risk and some are relatively illiquid. Investment Securities Securities held to earn interest and help meet liquidity needs. Other assets Bank premises and equipment, other real estate owned, and customers liability to the bank under acceptances(客户向银行承兑的债务) China Big Four Banks (12/31/2002) v.s. All US Banks (12/31/2002) PNC Bank (12/31/2000, TA: 63 bn) v.s. Community National Bank (12/31/2000, TA: 0.14bn) Bank Assets: Loans Loans are the major as