Tut 6 - Fin Institutions

Tut 6 - Fin Institutions - BANK1005 Derivatives and...

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
BANK1005 Derivatives and Securities Markets Page 1 of 4 Tutorial 6 (Week 7) – Financial Institutions 1 © HB, August 2007 Preparation for This Tutorial You should complete your study for this tutorial by using the relevant lecture notes, textbook and other resources. You will need your calculator during the tutorial. Have a good understanding of the key words used in this tutorial. In particular, for this tutorial you should: s Record the formula for the interest rate margin (IRM). s Complete at least some parts of the activities that you can. Activity 1 Adelaide Bank Limited – Income Statement “Adelaide Bank Limited is a publicly listed company with its head office in South Australia, providing financial services through our distribution network and through national alliances.” (Source: Adelaide Bank Limited, Annual Report 2003: 1) 1 We’ll study some of the information for the Adelaide Bank in this tutorial. I have taken this information from the bank’s 2003 annual report. We’ll simplify some of the information for our learning purposes, but the calculated results will be quite accurate! Adelaide Bank Limited Income Statement Years Ended 30 June 2003 2002 $'000 $'000 Interest income 494,868 409,313 Interest expense 327,362 280,522 Net interest income 167,506 128,791 Other income 96,385 92,196 Less: Fees to intermediaries 62,783 47,796 Total operating income 201,108 173,191 Bad and doubtful debts 6,711 4,678 Operating expenses 120,114 107,239 Operating profit before income tax 74,283 61,274 Income tax expense 22,958 20,033 Operating profit after income tax 51,325 41,241 Source: Adelaide Bank Limited, Annual Report 2003: 26 (Adapted) What is the purpose of the income statement? What does it show? Why is it important? Select some key items and think how these are different from those of another business such as an
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

Page1 / 4

Tut 6 - Fin Institutions - BANK1005 Derivatives and...

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online