Tier 2 capital: related pages
Value at risk
A measure of the risk of a portfolio; the loss that is unlikely to be exceeded in a given period of time with a given level of confidence.
Non-performing assets (NPA)
Loans that are not being repaid or serviced through interest payments on time.
Solvency margin
The minimum allowed excess of an insurance company’s capital over its liabilities.
Cost/income ratio
Most often used for banks: operating expenses ÷ operating income.
Interest spread
(interest income ÷ interest earning assets) - (interest expense ÷ interest bearing liabilities).
Return on average assets (ROAA)
Net profit ÷ average assets. An efficiency ratio relevant to banks.
Interest margin
Interest income minus interest expenses as a percentage of average interest earning assets.
Dynamic provisioning
The adjustment of bank's provisions for loans for the economic cycle.
Copyright Graeme Pietersz © 2005-2019
