FMAccounting.com | Accounting | Finance | Management |Treasury | Taxation |

• Home
• This Blog
• Author
• Accounting Bodies
• Subscribe
• Accounting Terms
• Revision Notes
• Questions
• E-Books
• Featured

Archive for the ‘Ratio Analysis’ Category

Asset Quality –Earnings Coverage

To assess the Asset Quality of Banks/Financial Institutions, the following ratios need to be analyzed:

Loans Loss
Non-performing loans to total loans  
Loan Recoveries ratio
Loan Loss Reserves
EARNINGS COVERAGE
Capital Adequacy

Capital Formation Ratio
Capital to Assets Growth
Gross Capital to Average Assets plus Reserves 

 

Ratio
Purpose
Formula

 Earnings Coverage Ratio
 

Measures the level of earnings and the charge to income [...]

April 25, 2007  Tags: asset quality, banks, earning coverage, Earnings  Posted in: Banks/Finan.Institutions, Ratio Analysis  No Comments

Asset Quality – Adequacy Of Loan Loss Reserves

To assess the Asset Quality, the following ratios need to be analyzed:

Loans Loss
Non-performing loans to total loans  
Loan Recoveries ratio
LOAN LOSS RESERVES  
Earnings coverage
Capital Adequacy

Capital Formation Ratio
Capital to Assets Growth
Gross Capital to Average Assets plus Reserves

ADEQUACY OF LOAN LOSS RESERVE   

Ratio
Purpose
Formula

 Loan Loss Reserve Ratio
 
 

To check whether the bank, in comparison [...]

April 25, 2007  Tags: asset quality, bank, loan loss reserves  Posted in: Banks/Finan.Institutions, Ratio Analysis  No Comments

Defensive Interval

One interesting liquidity ratio is the defensive interval which reflects theoretically how long the company can survive or defend itself in terms of its available cash plus cash equivalent ( most liquid cash) versus its daily cash operating requirement.

Ratio

Purpose
Formula

Defensive ratio

Used to indicate the number of days a company could theoretically remain [...]

April 25, 2007   Posted in: For Companies, Ratio Analysis  No Comments

Asset Quality-Non Performing Loans To Total Loans

To assess the Asset Quality of Banks/Financial Institutions, the following ratios need to be analyzed:

Loans Loss
NON-PERFORMING LOANS TO TOTAL LOANS
Loans Recoveries Rate
Loans Loss Reserve
Earnings coverage
Capital Adequacy

Capital Formation Ratio
Capital to Assets Growth
Gross Capital to Average Assets plus Reserves

 
NON-PERFORMING LOANS TO TOTAL LOANS   

Ratio

Measure
Formula

 Non Performing Loans To Total Loans
· helps determine the quantum [...]

April 25, 2007  Tags: asset quality, banks, non-performing loans to total loans  Posted in: Banks/Finan.Institutions, Ratio Analysis  One Comment

Asset Quality-Loans Loss

To assess the Asset Quality of Banks/Financial Institutions, the following ratios need to be analyzed:

LOANS LOSS
Non-performing loans to Total Loans
Loans Recoveries Ratio
Loans Loss Reserves
Earnings coverage
Capital Adequacy

Capital Formation Ratio

Capital to Assets Growth

Gross Capital to Average Assets plus Reserves

LOANS LOSS:

Poor asset quality is reflected in the loans written off or loans loss ratio, [...]

April 25, 2007   Posted in: Banks/Finan.Institutions, Ratio Analysis  One Comment

Asset Quality Of Banks And Financial Institutions- Introduction

One of the fundamental reasons for a bank/financial institution to collapse is its poor asset quality namely giving out bad or poor credit standard loans Not even foreign exchange exposure, deposits, maturity mismatches and open positions can hit it so hard to cause a bank/financial institution to collapse !  When a bank/financial institution get too [...]

April 25, 2007  Tags: asset quality, bad loans, banks  Posted in: Banks/Finan.Institutions, Ratio Analysis  No Comments

Market Value Added (MVA)

Earlier, the market/book ratio has been mentioned now we look at another useful market based ratio which is known as the Market value added ( MVA).
MVA is the difference between the market value of the company and the total capital invested in the company.
The formula of MVA is =
market capitalization ( number of equity shares [...]

March 24, 2007   Posted in: For Companies  No Comments

• « Older Entries

• Tags

  ACCA News ACCOUNTING FRAUD IN MALAYSIA Accounting principles Accounting Rate Of Return Accounting Software Accounting Standards Accounts Payable Activity based costing questions Activity based costing questions and answers activity based costing system advantages apportion interest Arms length Asian Tax News asset quality BALANCED SCORECARD Balance sheet Bankruptcy banks BCG matrix benefits of activity based costing system Best-in-class-kpi Bonus issue Brand Brand Building Budgeting Techniques; BUSINESS STRATEGY Capital Investment Appraisal Methods Capital Investment Appraisal Questions Cash Cash Conversion Cycle cash conversion cycle definition Cash flow Cash flows cash flow statement Cash Management Cash operating cycle conflicts of interest corporate strategy Corporate Tax Credit control credit department kpi Credit management Credit sales Credit vetting Daily Working Cycle Days Inventory Outstanding Days Sales Outstanding Debt departmental accounting DIO Dividend Dividend policy DuPont Model Earnings Economic Value Added Definition Economic Valued Added Effective Tax Rate Effective Transfer Pricing System EVA extend credit Finance Lease FINANCE ROLE Financial Perspective Financial statements Foreign Exchange Foreign exchange strategies Foreign exchange transactions Franchise Franchising Franchising advantages Free agreements Free agreements on conflicts of interest Free M&A Confidentiality Agreement Free tenancy agreement FRS FX FX foreign exchange terms FX Internal Hedging Method Hire Purchase Hire purchase accounting hire purchase interest How to IAS IFRS Income statement India transfer pricing India transfer pricing system Internal hedging Internal process perspective examples International Accounting Standards Inventory IPO Joint Venture Joint Venture Agreement KPI Learning & Growth perspectives examples Legal M&As M&As Malaysia Tax Budget 2010 Malaysia transfer pricing Management Services MASB Merger Merger & Acquisitions MIA Net Present Value NPV OHQ Operating Lease Operational Head Quarter Operational kpi Operational kpi examples Order to cash cycle Outsource Outsourcing Overtrading Payables Payback Product life cycle costing Profitability index Ratio Analysis REITs Rental Risk Management Risks ROI on Accounts Receivable sample agreement Shared Service Centre SOP SSC Standard Costing Questions Standard Operating Procedures stock stock management Strategy sukuk Supply Chain Timing differences trade reference Tranfer pricing TRANSFER PRICING Transfer pricing method Transfer Pricing System TREASURY articles What is Will WORKING CAPITAL working capital requirements

• Categories