This is a paper that focuses on the analysis of 2019 loan lending functions of three banks. The paper also provides factors to consider in performing the analysis of the three banks.
Analysis of 2019 loan lending functions of three banks
Analyze the 2019 lending function/loan portfolio of these three banks (Bank of San Francisco, California Bank of Commerce, and Avidbank) and determine which bank has the most “ideal” loan portfolio. You can ﬁnd a great deal of quarterly data and ﬁnancial ratios on U.S. commercial banks on ﬃec.gov, under
UBPR (uniform bank performance report). You may use other sources to analyze these three banks; however, you must cite the source(s) and provide a copy of the banks’ ﬁnancial statements.
These three banks will have different total asset balances, or, different sizes. Your assignment is to use what you have learnt in you ﬁnance classes to analyze each bank’s capital then determine which of the three banks has the most ideal loan portfolio levels and why.
Factors you may consider (but not limited to) when analyzing bank lending function/loan portfolio:
Do these banks have a “balanced” loan portfolio – fairly equal amounts in different types of loans (real estate, commercial, consumer loans, etc. )? Or do they have high loan concentration in any loan type(s) – is this good or bad?
Does each bank have high Allowance for Loan Loss (ALLL) compared to peer and bank industry?
High loan loss provision expenses
High loan losses
Comparing to peer and bank industry, is each bank’s loan growth high, similar, or low; is this good or bad?
Interest rate(s) charged to borrowers
some relevant pages in UBPR are the Loan Concentration pages, Past Due pages, and Allowance for Loan & Lease lossess Pages. You may also want to review the banks’ deposits (as the funding source for loans)