5LecturePerformanceofnondepositary111

5LecturePerformanceofnondepositary111 - Performance...

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Performance Valuation : Finance Insurance Investment Banking and Securities Mutual Funds Pension Funds
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1. Finance Companies They are like banks ….. They are unlike banks …. .. They obtain funding ……. .
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Profitability Ratios Net Interest Margin (NIM) = ( Finance Revenue–Interest Expense ) Average Receivables Average Monthly Principal Collections Average Monthly Receivables Operating Expenses /Average Receivables Finance Profit/ Average Receivables Finance Revenue/ Average Receivables ROE/ EM/PM
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2. Insurance Companies Written premiums provided by policy- holders are used to cover commissions, administrative expenses and claims incurred within the year. Reserves are put aside as commitments by the insurer for the insured policyholder and invested in securities of maturity equivalent to contracts.
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Some Life Insurance Products Whole Life: Policyholders pay fixed annual premiums over their lives in exchange for a policy with a specific death benefit. Term Life Policy : covers only the death protection Universal Life :Combines the death protection features of term insurance with the opportunity to earn market rates of return by investing in mutual funds
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INSURANCE COMPANIES Life Insurance Companies P/C Insurance Companies TYPICAL COMMON SIZE INCOME STATEMENT FOR
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5LecturePerformanceofnondepositary111 - Performance...

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