Trend analysis is a method used in technical analysis that tries to predict the future. Under this system, Revenue and cost information from a company’s income statement is arranged on a trend line for multiple reporting periods and then examined for trends and inconsistencies. The object of trend analysis is to spot actionable patterns from…
In banking parlance, volatile liabilities are ‘hot’ or ‘unstable’ funds that can disappear from bank’s balance sheet overnight. Demand deposits are best examples of volatile liabilities which can move out of the bank overnight. Thus, funding volatility ratio (FVR) is calculated by proportion of liquid assets to CASA deposits i.e. FVR=Liquid assets÷ CASA deposits. In…
The land, building, machinery etc. are known as non-liquid assets because it can take months for a person or company to receive cash from the sale of such assets. Unlike non-liquid assets, the liquid assets are cash in hand or the other assets which are cash equivalent. In simple words, liquid asset can be described…
CASA stands for Current Account and Savings Account in banking parlance. Besides in India, the term CASA is popularly is used in West Asia and South-east Asia countries. The difference between the average yield of interest obtained from loans and the average rate of interest paid for deposits and other such funds (or the cost…
When borrowers unable to pay interest on time, it will add to principal amount of the borrower’s loan account at regular frequency. In the other words Capitalization frequency is the addition of unpaid interest to the principal balance of your loan. That means it is added to borrower’s Current Principal and interest will now be…
One more round of Bipartite Discussions was held between workman unions and IBA today at Mumbai. IBA was represented by Mr. Rakesh Sharma, (MD of IDBI Bank), Chairman of the Small Negotiating Committee, Mrs. Reeta Kaul, GM, PNB, Mr. S K Suri, GM, Allahabad Bank, Mr. B Rajkumar, Dy. Chief Executive, IBA, Mr. Sanjay Prakash…
The difference between fraud and cheating lies in their variety. Cheating is described under Section 415 of IPC. Section 415 states that “Whoever, by deceiving any person, fraudulently or dishonestly induces the person so deceived to deliver any property to any person, or to consent that any person shall retain any property, or intentionally induces…
The standardized approach for counterparty credit risk (SA-CCR) is a new computational method for exposure at default (EAD) under the Basel capital adequacy framework. This approach replaces the Current Exposure Method (CEM), used by banks in India, for measuring exposure for counterparty credit risk arising from derivative transactions, with effect from April 1, 2018. The…
The Current exposure method (CEM) is a measurement of the replacement cost within a derivative contract in the case of a counterparty default. Here, the credit equivalent amount of a market related off-balance sheet transaction calculated using the current exposure method which will be the sum of current credit exposure and potential future credit exposure…
We all know ‘Sample’ means a small part or quantity intended to show what the whole is like. Similarly, the ‘Random Sampling’ is a way of selecting a portion chosen from the population in order to make inferences about the whole population. For example, pre-polls or exit polls results obtained from random voters aims to…