UNDERSTANDING TRENDS
FORGING STRATEGIES
FORGING STRATEGIES
Bank Business Models at a glance
The financial market structures and regulations in an ever-changing environment.
The Bank Business Models (BBM) analysis provides researchers and markets participants (i.e. depositors, creditors, rating agencies, regulators and supervisors) with a useful tool to:
- better understand the nature of risk attached to each bank business model
- its contribution to systemic risk throughout the economic cycle.
indicators
our method
To identify the bank business model, we use the Activity/Funding definition based on an Asset/Liability Approach and clustering methodology and the Statistical Analysis System introduced and explained in Ayadi (2019) and (Ayadi et al, 2016).
Clustering analysis is a statistical technique that assigns a set of observations into a distinct cluster. To run the cluster analysis, a selection of instruments which are the defining activity – funding features of the BM are consdiered: Loans to banks (as % of assets); Debt liabilities (as % of assets); Customer loans (as % of assets); Trading assets (as % of assets); Derivative exposures (as % of assets).
Clustering analysis is a statistical technique that assigns a set of observations into a distinct cluster. To run the cluster analysis, a selection of instruments which are the defining activity – funding features of the BM are consdiered: Loans to banks (as % of assets); Debt liabilities (as % of assets); Customer loans (as % of assets); Trading assets (as % of assets); Derivative exposures (as % of assets).
About the Founder
Rym Ayadi is Honorary Professor at CASS Business School, Faculty of Finance and Member of the Centre for Banking Research (CBR) at the City University in London, Founding President of the Euro-Mediterranean Economists Association (EMEA) and Founder and Scientific Director of the Euro-Mediterranean Network for Economic Studies (EMNES).
area of interest
In a context of an evolution of market structures and regulations, the banks’ business models analysis can provide market participants, depositors, creditors, regulators and supervisors with a useful tool to better understand the nature of risk attached to each bank business model and its contribution to systemic risk throughout the economic cycle.
Promoted by EMEA
