CAMELS' ANALYSIS IN BANKING INDUSTRY

Abstract

CAMELS" model as a tool is very effective, efficient and accurate to be used as a performance evaluator in banking industries and to anticipate the future and relative risk. "CAMELS" ratios are calculated in order to focus on financial performance. The CAMELS stands for Capital adequacy, Asset quality, Management, Earning and Liquidity and Sensitivity. In this study some important ratios are chosen and calculated to evaluate bank's performance. Data which is used in this study is gathered from annual financial reports of an Iranian bank. Then data is compared with other bank's ratios and reports. Certainly, the trends of calculations and relevant figures show important points for managers and also, CAMELS rating can be an efficient tool to manage and control and decide in management accounting view.