What Has the Financial Crisis Taught Us about Bank Performance Reporting?

The financial crisis provided a watershed moment for enhancing the transparency of banks. Financial institutions researcher Stephen Ryan of New York University has characterized the financial crisis as the single most ”teachable moment” in finance. To examine the effects of financial crisis on bank performance, CFA Institute recently issued Financial Crisis Insights on Bank Performance Reporting (Part 1): Assessing the Key Factors Influencing Price to Book Ratios.

It is the first of a two part-study analysing the relationship between key elements of bank performance reporting (i.e., loan impairments, disclosed fair value, return on equity (ROE) and its components) and market indicators of value and risk such as price-to-book (P/B) ratios and credit-default swap (CDS) spreads. The study examines 51 mostly large, complex banks in the European Union, United States, Japan, Canada, and Australia from 2003 to 2013.

Read more http://blogs.cfainstitute.org/marketintegrity/2014/07/15/what-has-the-financial-crisis-taught-us-about-bank-performance-reporting/

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