HEAT! A Bank Health Assessment Tool
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Summary:
Developments during the global financial crisis have highlighted the importance of differentiating across financial systems and institutions. Assessments of financial stability have increasingly considered the characteristics of individual banks within a financial system, as well as those with significant international reach, to identify vulnerabilities and inform policy decisions. This paper proposes a simple measure of bank soundness, the Bank Health Index (BHI), to facilitate preliminary analyses of individual financial institutions relative to their peers. The evidence suggests that the BHI is useful for a first-pass identification of bank soundness conditions. Automated spreadsheet templates of the bank Health Assessment Tool (HEAT!) are provided for users with access to the BankScope, Bloomberg and/or SNL database(s).
Series:
Working Paper No. 2013/177
Subject:
Bank soundness Banking Commercial banks Financial institutions Financial sector policy and analysis Global systemically important banks Loans Nonperforming loans
English
Publication Date:
August 9, 2013
ISBN/ISSN:
9781484385227/1018-5941
Stock No:
WPIEA2013177
Pages:
20
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