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Essay / Research Paper Abstract
This 3 page paper performs a financial analysis on Bay Banks of Virginia Inc between 2003 – 2005, looking at the liquidity, profitability and general performance as well as the growth. The bibliography cites 1 source.
Page Count:
3 pages (~225 words per page)
File: TS14_TEbaybanks.rtf
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Unformatted sample text from the term paper:
Inc. we can look at its financial performance. This is a holding company for both the Bay Trust Company and the Bank of Lancaster, these provide a range of banking
services and accounts. To assess the company we can start by looking at the internal liquidity. For a bank liquidity measures usually look not to the entire operation but at
the level of interest that the company is paying out and that which is coming in. For this we will look at the net interest margin and the amount
of time that the income will cover the outgoings, for the net figure we need to deduct the provision for bad loans. Figure 1 Liquidity RESULTS OF
OPERATIONS 2005 2004 2003 Interest Income 16,238 14,085 13,329 Interest Expense 5,129 4,310 4,766 Net Interest Income 11,109 9,775 8,563 Provision for
Loan Losses 559 300 312 Net Interest Income after Provision 10,550 9,475 8,251 Net interest margin 64.97% 67.27% 61.90% Liquidity ratio 2.06 2.20
1.73 This appear to give a comfortable level of liquidity, but one that is also fluctuating slightly, the main concern may be the increased requirement for bad loan provisions. However
as the interest income has increased we would expect to see some increase in this provision. If we want to look
at operating performance then we can look at the return on assets and the return on equity, these are measures that look at how effectively the bank is making
use of the assets and the equity that it has. There are several ways in which the calculation can be performed, for this we will look at the returns using
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