## figure1-22

## Source details

**Canonical URL:** [figure1-22](https://www.imf.org/-/media/files/publications/gfsr/2018/april/ch1/pdf/figure1-22.pdf)

## Other formats

- [Markdown version](/-/media/files/publications/gfsr/2018/april/ch1/pdf/figure1-22.pdf.md)
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### Equity market signals and profitability
- Price-to-book ratio (March 2018) shown for sample banks; equity market signals are mixed.
- Analysts’ forecast 2019 return on assets (percent) presented alongside price-to-book ratios.

### Bank balance sheet health and metrics
- Bank balance sheet metrics have improved, including capital buffers and funding profiles.
- Sample: Panels 2 and 3 are based on a sample of 691 banks headquartered in advanced economies.
- In panels 2 to 4, where 2017 data are unavailable, the latest published figures are used.
- US bank assets have been adjusted for derivatives netting (panel 1).
- Bank buffers = Tier 1 common capital plus loan loss provisions less 60 percent of nonperforming loans as a percentage of tangible assets (adjusted for derivatives netting at US banks).
  - The 60 percent figure is an assumption used for this analysis and not a regulatory requirement.

### Buffer and loan-to-deposit targets and distribution
- Targets (percent): Buffer ratio = 4.0; loan-to-deposit ratio = 100
- Outer ring: 2017 distribution (percent): 13%; 49%; 38%; 52%; 40%; 8%
- Inner ring: 2007 distribution (percent): (shown for comparison with 2017 in the figure)
- Buffer and loan-to-deposit ratios above target? (visualized by outer/inner rings for 2017 and 2007)
- Panel 2 and 3 axes / scales shown:
  - Buffer and loan-to-deposit ratios (Percent of sample bank assets)
  - Loan-to-deposit ratio (percent)
  - Bank buffer ratio (percent)
  - Scales include 0, 20, 40, 60, 80, 100 and sample years 2007, 17

### Regional composition and comparisons
- Regions defined in the figure:
  - Asia-Pacific = Australia, Japan, Korea, New Zealand, and Singapore
  - North America = Canada and the United States
  - Other Europe = Denmark, Iceland, Norway, Sweden, Switzerland, and the United Kingdom
  - Euro area; Other Europe; North America; Asia-Pacific; Neither; One; Both; Others; Ireland, Italy, and Spain; Cyprus, Greece, and Portugal (labels appear in the figure)

### Euro area nonperforming loans
- Panel 4: Euro Area Nonperforming Loans (Billions of euros)
  - Time series axis labels include years 2009 10 11 12 13 14 15 16 17 with scale markers 0, 200, 400, 600, 800, 1,000, 1,200

### Key messages and policy implication
- Equity market signals are mixed.
- Bank balance sheet metrics have improved, including capital buffers and funding profiles.
- But work to fortify balance sheets should continue.

*Sources: Bloomberg Finance L.P.; IMF, Financial Soundness Indicators database; S&P Global Market Intelligence; and IMF staff calculations.*

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_Source: https://www.imf.org/-/media/files/publications/gfsr/2018/april/ch1/pdf/figure1-22.pdf_