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:: year 4, Issue 12 (summer 2012) ::
JMBR 2012, 4(12): 45-70 Back to browse issues page
Banking Supervision, Based on an Early Warning System, Using CAMEL Ratios and a Logit Model
Soodabeh Seraj *1, Mandana Taheri
Abstract:   (4023 Views)

This paper evaluates the financial performance of Iranian banks, based on an early warning system, using Logit Predicting Model and presenting CAMEL ratios: Capital Adequacy, Asset Quality, Management, Earning, and Liquidity. For this purpose, we use financial data of 17 state and private banks during the period of 2005-2011.  
The results suggest that 6 ratios (from 17 rations of logit regression as independent variables) are able to assess/ evaluate and supervise the banking operation. In other words, central bank, by monitoring these 6 ratios, can apply early warning system and supervise banking system. In addition, results show that there is a significant difference between average of 12 financial ratios of state and private banks.

JEL Classification: G21, G33, M42

Keywords: Banking Supervision, Early Warning System, CAMEL Ratios, Logit Model
Full-Text [PDF 229 kb]   (6146 Downloads)    
Type of Study: Empirical Study |
Received: 2014/08/9 | Accepted: 2014/08/9 | Published: 2014/08/9
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year 4, Issue 12 (summer 2012) Back to browse issues page
فصلنامه پژوهش‌های پولی-بانکی Journal of Monetary & Banking Research
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