| Description |
1 online resource (1 volume) : illustrations |
| Bibliography |
Includes bibliographical references and index. |
| Summary |
This book presents the main valuation approaches that can be used to value financial institutions. By sketching 1) the different business models of banks (both commercial and investment banks) and insurance companies (life, property and casualty and reinsurance); 2) the structure and peculiarities of financial institutions' reporting and financial statements; and 3) the main features of regulatory capital frameworks for banking and insurance (ie Basel III, Solvency II), the book addresses why such elements make the valuation of financial institutions different from the valuation of non-financial companies. The book then features the valuation models that can be used to determine the value of banks and insurance companies including the Discounted Cash Flow, Dividend Discount Model, and Residual Income Model (with the appropriate estimation techniques for the cost of capital and cash flow in financial industries). The main techniques to perform the relative valuation of financial institutions are then presented: along the traditional multiples (P/E, P/BV, P/TBV, P/NAV), the multiples based on industry-specific value drivers are discussed (for example, P/Pre Provision Profit, P/Deposits, P/Premiums, P/Number of branches). Further valuation tools such as the "Value Maps" or the "Warranted Equity Method" will be explained and discussed. The closing section of the book will briefly focus on the valuation of specific financial companies/vehicles such as closed-end funds, private equity funds, leasing companies, etc |
| Contents |
The Valuation of Financial Companies: Tools and Techniques to Value Banks, Insurance Companies, and Other Financial Institutions; Contents; Preface; Acknowledgments; 1 Bank Business Models; 1.1 Economics of Banking; 1.2 Commercial Banks; 1.2.1 Structure of the Industry in the US; 1.2.2 Overview of the US Regulation; 1.2.3 Commercial Banks Balance Sheets; 1.3 Investment Banks; 1.3.1 Structure of the US Banking Industry; 1.3.2 Typical Balance Sheet for an Investment Bank; 1.3.3 The Banking Industry outside the US; 2 Financial Statements Analysis for Banks; 2.1 Balance Sheet; 2.1.1 Assets. |
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2.1.2 Investment Property2.1.3 Intangibles; 2.1.4 Research and Development; 2.1.5 Goodwill; 2.1.6 Securities; 2.1.7 Equity Stakes; 2.1.8 Loans and Receivables; 2.1.9 Impairment Test; 2.1.10 Financial Liabilities; 2.1.11 Hedging; 2.1.12 De-recognition of Financial Assets and Liabilities; 2.2 The US GAAP for Banks; 2.2.1 Reversal of Impairment; 2.2.2 Transfer among Different Categories; 2.3 Profit & Loss Statement; 2.4 Major Differences between IASIFRS and US GAAP; 2.5 Example of IASIFRS Application; 3 The Regulatory Capital for Banks; 3.1 Regulatory Capital Requirements. |
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3.1.1 Definition of Capital According to Basel I and II3.1.2 The Risk-Weighted Assets; 3.2 Basel II; 3.2.1 Does Basel II Work?; 3.3 The Reform of Basel III; 3.3.1 New Definition of Capital; 3.3.2 Change in RWA Computation; 3.3.3 New Coefficients; 3.3.4 Leverage Ratio; 3.3.5 Liquidity Ratios; 3.4 Managing the Regulatory Capital; 4 Assessing and Preparing the Business Plan for a Bank; 4.1 STATUS QUO Analysis; 4.1.1 Asset Quality; 4.1.2 Toxic and Illiquid Assets; 4.1.3 Goodwill; 4.1.4 Capitalization; 4.2 Internal Consistency; 4.2.1 Historical versus Projected Performance; 4.2.2 ROE Framework. |
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4.2.3 P & L and Balance Sheet Drivers4.2.4 P & L versus Balance Sheet; 4.2.5 Asset Side versus Liability Side; 4.2.6 Financial versus Operating Forecasts; 4.3 External Consistency; 4.3.1 Macroeconomic Outlook; 4.3.2 Competitive Dynamics; 4.3.3 Business Plan versus Market Consensus; 4.4 The Forecasting Model of a Bank; 4.4.1 Balance Sheet; 4.4.2 P & L; 4.4.3 Checking Forecasts; 5 Bank Valuation; 5.1 Why Bank Valuation is Different; 5.2 Discounted Returns Model; 5.2.1 The Cost of Capital for Financial Institutions; 5.2.2 The Dividend Discount Model; 5.2.3 The Cash Flow to Equity Model. |
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5.2.4 The Excess Return Model5.3 Relative Valuation; 5.3.1 Market Multiples; 5.3.2 Deal Multiples; 5.3.3 Multiples from Fundamentals; 5.3.4 Value Maps and Other Regressions; 5.4 AssetLiability-Based Valuation; 5.5 The Sum Of The Parts Framework; 5.6 Bank Valuation in M & A; 5.7 The Valuation of Wells Bank; 6 Insurance Business Models and Financial Statements; 6.1 The Business Model of Insurance Companies; 6.2 Segmentation by Products; 6.2.1 Life and Health; 6.2.2 Property and Casualty; 6.2.3 Reinsurance; 6.3 Distribution Channels; 6.4 Insurance Balance Sheet under US GAAP. |
| Subject |
Valuation.
|
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Financial institutions -- Valuation.
|
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Business.
|
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Cash management.
|
|
Évaluation. |
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Institutions financières -- Évaluation. |
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Affaires. |
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Gestion de trésorerie. |
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business (commercial function) |
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Business |
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Cash management |
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Financial institutions -- Valuation |
|
Valuation |
| Added Author |
Gianfrate, Gianfranco, author.
|
|
Zanetti, Laura, author.
|
| Other Form: |
Print version: Masari, Mario. Valuation of financial companies (OCoLC)874147164 |
| ISBN |
9781118617250 (electronic bk.) |
|
1118617258 (electronic bk.) |
|
9781118617267 (electronic bk.) |
|
1118617266 (electronic bk.) |
|
9781118821367 |
|
111882136X |
|
9781306322539 |
|
1306322537 |
| Music No. |
EB00067039 Recorded Books |
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