Analysis. Methods that are used in the assessment market value banks, quite a few. However, in Russian conditions the real price of a credit institution almost never coincides with the calculated one.

The need to assess the market value of a credit institution most often arises when it comes to the sale of a bank or a large block of its shares. At the same time, the assessment can be carried out both by the buyer himself and by an independent company, for example investment bank. There are four main ways to evaluate a bank - costly, profitable, comparative and quotation. However, in Russia only one, costly method is used.

"pure" technique. One of the most famous and simple ways market value appraisal is the analysis of the net assets of an enterprise. Some experts also call this method costly. Its essence boils down to the fact that its obligations to creditors are deducted from the market value of the costs of creating assets that the bank has. That's what it is net assets credit organization. They, in turn, represent the funds owned by shareholders - its real equity capital (it differs from equity capital calculated according to the methodology of the Central Bank).

In principle, each credit institution calculates its own capital on a monthly basis using the Central Bank methodology and reports to the regulator. It is calculated in a different way: here there is no subtraction from total amount the assets of the bank's liabilities, and the addition of the components of equity. In particular, equity includes authorized capital, Extra capital(income from the issue or revaluation of the value of property), profit, as well as various funds (reserve, accumulation, special purpose).

However, the interviewed "F." experts did not remember a single case when, when buying a bank or part of its shares, the parties were guided by their own capital, calculated according to the methodology of the Central Bank. According to market participants, the amount received does not give an objective assessment. The amount of capital assessed by the banks themselves for reporting to the regulator, as a rule, is greater than real net assets. “The capital may contain assets of inadequate quality,” explains the director analytical center"Rus-rating" company Maxim Vasin, - the regulator is far from always able to track this: usually it pays attention only to those loans that the bank has issued directly to legally related structures.

One of the most common methods of scheme capital increase looks like this: the owner places money in the bank, and the lender returns it under the guise of long-term loan affiliated company, the legal relationship with which is difficult to trace. “Adequate valuation using the net asset method assumes that scheme transactions will not be taken into account,” says Alexander Antonov, chief economist of the risk department at BIN Bank, “own capital here means only the money actually invested in the bank, and fictitious funds are screened out.” For example, appraisers may notice that a certain part of the loans is not returned to the bank for several years. This is the reason for a detailed analysis of such loans and tracking the relationship of the lender with the borrowers.

A look into the future and comparison. The method of evaluating a bank by analyzing its net assets does not take into account important indicator- prospects for the development of a credit institution, the profit that it will bring in the future. For a bank, unlike non-financial companies, this is one of the most important criteria, since its main assets are investments. Therefore, forecasting their profitability plays a key role in calculating the cost. And here the "profitable" method of valuation is applied (or the method of discounted cash flows).

Its essence lies in the fact that not only analyzed Current state bank, but also its future cash flows are predicted: how much this business will bring to shareholders in the form of profit. The expected return is adjusted for the risks of the bank. For example, the quality loan portfolio, business diversification, liquidity - in a word, all indicators that affect the risks of owners. As a result, cash flows are discounted, that is, they are multiplied by a certain coefficient calculated for the assessed credit institution.

As a result, the real market value of the bank can be much higher than the amount of equity capital. For example, at the end of last year, Delta Bank was bought by GE Consumer Finance, a division of General Electric, from the Delta Capital Management fund for $100 million, while its equity was about $25 million. plans to acquire Vneshtorgbank, is estimated by analysts at $600 million, while its capital as of January 1 was about $320 million. the officially announced amount of the deal is $200 million.

However, market participants agree that in Russian conditions the "profitable" method can not always give an adequate assessment. "In Russia with its macroeconomic instability long term and even medium-term forecasts- a thankless task, - commented Konstantin Ordov, the leading appraiser of the Otsenka-dako company, - so the probability of an error in the assessment by the discounted cash flow method is very high. In addition, the analysis of expected profit is subjective and depends on how positive or negative the appraiser is.

Most often in this case buyer risk. Thus, according to Peter Kelle, Chairman of the Board of Directors of the International Moscow Bank and Managing Director for the CIS countries of Hypovereinsbank (Munich), the price of Russian banks is often inflated precisely because the owners include in it not only net worth bank, but also its prospects. “At the same time, they estimate the prospects too rosy,” says Peter Kelle. - The activity of intermediaries - investment banks - also contributes to the increase in prices. Their reward is a certain percentage of the transaction, so they tell the buyer stories.”

“There were cases when large Russian banks refused to acquire smaller credit institutions, because their profitability was estimated at 2-3 times higher than the industry average,” adds Konstantin Ordov, “however, to get an intelligible explanation of how such high profits were achieved, failed, so the buyers decided not to risk it.”

Risk assessment can also lead to the opposite effect: the market value of the bank will be significantly lower than its book value. Thus, according to Maxim Vasin, the banks "Menatep SPb" and "Trust", acquired in May last year by their management, were bought at a price two times lower than the cost of capital (the deal was estimated at $115 million).

When Vneshtorgbank purchased Guta-Bank, which took place last summer, the transaction amount was generally symbolic - 1 million rubles. No matter what predicament you are in big bank, its market value cannot be so low. One of the interlocutors "F." suggested that it was a compromise between the former shareholders, who withdrew the assets, and the new owner (having paid a symbolic amount, he agreed not to make any claims).

Another method that allows you to calculate the cost of a credit institution is the assessment of peer banks, that is, the comparison method. "Let's say you buy retail bank with 50 branches, - Maxim Vasin explains, - and a year ago, a deal was made to purchase a credit institution similar in business, which has approximately the same branch network. And then the appraiser can assume that the purchased bank costs about the same. Next, the cost is adjusted - based on the assessment of the risks of the credit institution, the quality of management, and reputation in the market.

According to experts, the most reliable assessment of the value of a bank can be obtained when its shares are sold on the stock market. Knowing the quote of one security, you can calculate the value of the entire credit institution. At the same time, for an adequate assessment, at least 10% of shares must be traded on the stock exchange.

However, determining the market value of a credit institution using the last two methods in Russian conditions is even more difficult than using the income method. The comparison method is not very effective, since there is practically nothing to compare with: no one knows exactly what financial mechanisms are used when concluding a particular transaction, and the real purchase price is most often silent. As for valuation based on share prices, this method is not used in Russia at all, since today there is only one credit institution whose shares are freely traded on the stock market - this is Sberbank.

Workarounds. As a result, the main assessment method for domestic banks remains the net asset method - according to at least it causes the least controversy. In addition, the cost, as a rule, is also estimated by other methods, so that the participants in the transaction have the most objective picture.

“The price of a bank is made up not only of the cost of capital and expected profit, but also of the brand value,” says Alexander Antonov. According to him, the brand, which primarily implies the loyalty of customers and counterparties to the bank, can increase the value of a credit institution by two or three times and even ten times. However, in Russian practice it is very difficult to calculate the value of this indicator - again, because there is nothing to compare with. According to Alexander Antonov, the probability of a correct assessment of the banking brand is 20%, expected profit - 50%, and capital - 80%. “The value of a credit institution is equal to the sum of all these elements,” says the banker, “accordingly, the probabilities are multiplied.” In other words, it turns out that the probability of a correct estimate in this case is only 8% (0.2 5 0.5 5 0.8 = 0.08).

Experts believe that the main problem in assessing the value of credit institutions in Russia is their lack of transparency. “This is expressed both in the ownership structure and in the financial condition,” says Artur Bounegra, Vice President of Orgresbank. “The reasons for this situation are partly the insufficiently effective supervision by the Central Bank, the imperfection of banking legislation, the insufficiently intensive transition of banks to international financial reporting standards, which are precisely designed to help customers, counterparties and potential investors assess the real financial condition of the bank.”

Aleksey Demidov, Deputy Chairman of the Project Finance Bank, agrees with this opinion. “The main negative factor in the assessment is the unwillingness of the owners to reflect complete and reliable information in the statements,” the banker is sure, “as practice shows, even an auditor with a big name is not immune from a mistake in assessing the business of his client, who deliberately distorts the data using dubious transactions” . In addition, according to Alexei Demidov, the risk management system of financial institutions remains opaque, for example, the calculation credit risks and risks of investing in securities. “Even if the balance sheet data really reflects the state of the bank, then in the absence of competent and effective risk management, its business is worth nothing,” the expert says.

In conditions of opacity, appraisers have to resort to various tricks. Thus, according to one of the market participants, reliable information on the bank can often be obtained only from the so-called paid sources. “A credit organization begins to prepare for the sale long before the transaction,” the source explains, “it “cleans up” its indicators in order to provide information about itself in the most favorable light. The buyer wants an objective picture.” According to F.'s interlocutor, some consulting companies provide the appraiser with secret information for a fee, having appropriate sources in the Central Bank, Rosfinmonitoring or tax authorities. “By and large, this is“ piracy ”, firms that provide similar services, risk their business, - added the banker, - but in Russia they look at such things through their fingers.

In addition, the assessment often uses insider information, that is, sources in the bank itself. According to some market participants, the share of "insider" from the total amount of data that is collected during the assessment can reach up to 50%. Both personal acquaintances with bank employees and information from customers who are served there are used.

Not for sale. On the other side, Russian bank may himself be interested in having its value estimated as objectively as possible. "The assessment can be used to monitor the financial condition of a credit institution, - comments Artur Bounegra, - as well as to analyze the effectiveness of the management and the correctness of its business strategy."

In the process of evaluation, which in this case it is advisable to entrust independent company, the owners of the bank find out not only the final cost, but also the factors that influenced it. By correcting the errors, shareholders can then raise the price substantially when selling their business. For example, the value of a bank is strongly influenced by the diversification of the loan portfolio - the larger it is, the higher the price of a credit institution. It may also require a renewal of the management team, optimization of business and maintenance costs. branch network or even a rebrand. As a result, the owners may decide to completely sell their business, having come to the conclusion that its further development is not interesting for them.

However, the opposite effect is also possible: if the analysis is carried out with the aim of selling or attracting a strategic investor, and the bank receives a high assessment of its business and, most importantly, its prospects, then the owners may refuse the transaction altogether, especially if it is a question of selling a controlling stake. After all, it makes no sense to sell a business that brings super profits.

It is possible that the owners will immediately offer the buyer a price that will be unacceptable for him. For example, this is how many experts explain the termination of the transaction for the purchase by Cetelem, a retail division of BNP Paribas, of 50% of Russian Standard, which owns 90.75% of the shares of the bank of the same name. According to one version, the French were asked for a lot more money than previously stated.

Nothing to count on. When estimating the value of a bankrupt bank, it is much easier to get an exact figure: profit, brand and risks no longer have to be taken into account, so only assets are valued directly. An analysis of the property of a bankrupt bank is carried out in the process of formation of the bankruptcy estate. “At the same time, the law on bankruptcy of credit organizations establishes in an imperative manner that the bankruptcy trustee is obliged to involve an independent appraiser,” says Ligas lawyer Pavel Sadovsky. True, an independent appraiser is not required by law to determine the market price of securities owned by a credit institution and admitted to circulation.

Despite the simplicity of the assessment, the chances of creditors to get their money in full are small. “Given that most of the assets of an average bank can be withdrawn in about one to two weeks, the most important criterion in Russia that increases the likelihood of returning money to creditors is the honesty of the owner,” says Alexander Antonov.

As for the bank's property and fixed assets (for example, real estate, furniture, computers), everything here depends on the honesty of the bankruptcy trustee. “Ideally, the property is put up for auction,” says Maxim Vasin, “but in reality it is distributed for a pittance between selected creditors and a group of bankruptcy trustee or liquidator.”

THE MARKET VALUE OF A LARGE BANK IS 2-3 TIMES ITS OWN CAPITAL

THE APPRAISER'S FEES DEPEND ON THE AMOUNT OF THE TRANSACTION, SO HE TELLS THE BUYER FAIRY TALES

YOU CAN BUY SECRET INFORMATION ABOUT THE ACQUIRED BANK FROM CONSULTING COMPANIES

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Control work on the course

"Estimation of the value of the enterprise (business)"

Topic: Features of valuation commercial bank

Explanatory note 23 pages, 7 sources, 21 formulas.

Corporate securities, Shares, Types (standards) of value, Information required for valuation, Methods for valuing an enterprise (business), Methods for valuing shares, Income approach, Comparative approach, cost approach, Coordination of evaluation results.

The purpose of the work is to consolidate the knowledge gained in the process of classroom and independent knowledge in the course “Valuation of enterprises (businesses), as well as a more in-depth and detailed study of the theory and practice of determining the value of securities.

The object of the study is the features of the theory and practice of determining the value ordinary shares jar.

In the process of work, the study of fundamental and periodical literature, normative and reference sources on the selected topic was carried out.

Based on the results of the study, the main aspects and features of the valuation of corporate securities were determined, and the corresponding conclusions were drawn.

INTRODUCTION

1. THE CONCEPT OF THE VALUE OF A BANK AND THE NEED FOR ITS ASSESSMENT IN MODERN CONDITIONS

2.1 The main characteristics of the features of the assessment of the bank.

CONCLUSION

INTRODUCTION

For the current stage of development of domestic banking sector characterized by a relative stabilization of the business of commercial banks, as well as a slight increase in the turnover of banking operations. In many respects, this insignificant growth was caused by a certain increase in funds in current accounts and deposits, an influx of new customers, an increase in demand for loans and other basic banking products.

Opportunity to attract additional resources and investments in commercial Bank for the purpose of its further development is uniquely determined by the degree of its financial stability. At the same time, a serious problem for an investor when choosing an investment object is the assessment of its (bank) market value, on the basis of which it is possible to identify and investigate factors directly related to the risk and investment efficiency. Such an assessment allows a much more accurate representation of the activities of a financial institution than just the assessment of its shares by the stock market, since it allows, first of all, to evaluate the bank's assets and future business income. The relevance of assessing the market value is also due to the fact that domestic financial market unstable and not provided with sufficiently objective and complete information about the activities of issuers, the quality and value of their securities, especially those of commercial banks. Today, when the range of goals and objects of assessment in connection with further development market institutions in our country has expanded significantly, the assessment of the market value of a business, including banking, becomes necessary.

In the West, business valuation of companies, including banks, is an important link financial management firm and its capital. Modern Western banking management is focused on a simple idea - managing and maximizing the value of the bank, which in turn implies the identification of factors that create and destroy the value of the bank as a firm. Assessment of the market value of a commercial bank as a whole and its assets is also carried out in case of mergers and acquisitions; bankruptcy, liquidation of a bank; in case of anti-crisis measures; transactions for the purchase and sale of businesses in banking. At the same time, commercial banks are institutions whose assessment is quite specific, since it is difficult to determine the quality of their loan portfolios, calculate the shares in profits received at mismatched interest rates, and determine the efficiency of their organizational units.

1. THE CONCEPT OF THE VALUE OF A BANK AND THE NEED FOR ITS ASSESSMENT IN MODERN CONDITIONS

In modern Russian conditions, a commercial bank acts, on the one hand, as an active element market economy, which performs the function of accumulation Money and their provision for temporary use on the terms of payment, urgency and repayment. On the other hand, financial institutions in general, and commercial banks in particular, represent a kind of new product that appeared on the financial market. Consequently, like any commodity, they can be bought or sold (partially or completely), as well as be the objects of other market transactions permitted by law. Such goods may be:

Commercial bank as a whole;

The totality of assets of a commercial bank or their separate types;

Liabilities of a commercial bank.

In this regard, it becomes necessary to determine the fair price of the transaction, in which both the buyer and the seller are interested. The valuation of a commercial bank is intended to determine this price.

The valuation of a commercial bank is understood as an ordered process, resulting in the determination of the market value of a commercial bank, taking into account the income it brings. The need to assess the market value of a commercial bank follows directly from the objectives of the assessment. The main purpose of the appraisal is to calculate and justify the market value of the property complex (whether it be a bank, its assets or part of them) on a certain date.

In modern Russian conditions, there are several purposes for which a commercial bank can be assessed. These goals include the following:

1. Improving the efficiency of current asset and liability management in a commercial bank. The current stage of development of the domestic banking system indicates that Russian banks lack experience in managing bank resources, their rational use, especially in assessing the market value of assets. Correct and timely assessment of a commercial bank from the inside, carried out regularly in Western banks special units or within the framework of financial management, it is designed to solve a number of tasks facing the bank: the problem of the safety of deposit funds, the coordination of assets and liabilities of a commercial bank in terms of volume and timing.

2. Determination of the creditworthiness of organizations, including for interbank lending. In this case, we are talking primarily about determining the market value of a commercial bank as a key factor in its financial stability when considering the issue of granting a loan to a commercial bank.

3. Determining the cost of the bank's capital for an investor or a group of investors, which is generated by the development of the securities market. In this case, the object of evaluation is the securities of a commercial bank, both in a package and separately. Evaluation here can be carried out in order to determine the price of a share or block of shares for sale or resale, income generation, acquisition of a controlling stake, as well as when placing new issues of securities.

4. Determination of the market value of assets, in particular, with a view to their sale or acquisition. Maintained at the proper level, the value of the assets of a commercial bank at the same time ensures the safety of the client's funds and is the source of his economic growth. In this case, one should focus not on the book value of assets, but on their market valuation, for which regular revaluation of the bank's assets in the market should be carried out.

5. Ensuring the stability of commercial banks and the financial industry as a whole by the regulatory authorities.

6. Evaluation of commercial banks has recently become especially relevant due to the increasing practice of mergers and acquisitions in financial sector. Moreover, this trend is typical not only for foreign, but also for Russian banks.

7. Valuation is a very effective technique used in restructuring. Managers who possess the skills of evaluation have significant advantages over their competitors.

An appraisal of a commercial bank is also possible in other cases, for example, for insurance purposes when determining the insurable value of an object, which can be a financial institution and its assets; for tax purposes and in some other cases.

The assessment of the market value of a commercial bank is based on an economic model that determines market price an ordinary share of a company through a current estimate of the expected future earnings from that share. Unlike accounting economic model firm is determined by the company's strategy, and therefore focused on maximizing its market value, and not just profit.

When assessing the value of a bank, they usually rely on two indicators, one of which is absolute, the other is relative.

An absolute indicator that characterizes the value of a commercial bank is the current value of the total cash flow to the bank's shareholders or its owners. In other words, the value of the bank's equity is equal to the future payments to the shareholders of the bank, reduced to the current value, i.e. discounted at the appropriate rate of interest.

The relative value of a commercial bank is the market value of its common stock. According to this model, the current value of the stock can be represented as follows:

where V is the current value of the share;

It - dividends I expected by shareholders, received at time t;

i - the discount rate for the stock, reflecting the minimum acceptable level of profitability with an acceptable level of risk.

The economic meaning of this indicator is that the higher the market value of a bank's shares in the market, the higher the market value of the commercial bank itself. However, this indicator also has its drawbacks. First, this indicator is very difficult (and sometimes simply impossible) to determine for banks formed in the form of closed joint-stock companies, or for banks whose shares are not freely floated on the market. Secondly, there are certain reasons due to a combination of circumstances when the value of a share on the market is slightly higher (for example, when a small number of bank shares are traded on the market) or lower than their market value. Then one should resort to the definition absolute indicator the value of the bank as the main one in determining its market value.

When determining the market value of a commercial bank or its individual assets, it should be remembered that the valuation of the business of commercial banks is largely determined by a number of determining factors in the development of the banking sector, which usually include:

Strict regulation and supervision of the activities of commercial banks by the state;

Low level of own capital and, accordingly, a large share of borrowed funds;

A high degree of concentration of risks on the bank's balance sheet and a significant impact of financial leverage;

Peculiarities accounting in a commercial bank;

Difficulty in making and processing a number of transactions (for example, transactions with derivative financial instruments);

The presence of intangible assets in the form of government guarantees in a commercial bank, which must be taken into account when assessing its market value;

A combination of an acceptable level of income with a relatively high level of risk and increased requirements for balance sheet liquidity.

Thus, a modern commercial bank is a rather complex object of assessment due to the secrecy of a large part of the information about it, strict regulation of the bank's activities by regulatory authorities, concentration of risks on the bank's balance sheet. The appraisal of a commercial bank requires the appraiser to high level qualifications and extensive experience in the field of accounting, financial analysis, planning.

2. FEATURES OF ASSESSING THE COST OF A COMMERCIAL BANK

2.1 Key features of the bank valuation feature

The assessment of the market value of a commercial bank, its business is characterized by the following features:

The combination in the activities of the bank of the traditional functions of a financial intermediary (between depositors of funds and consumers, redistribution financial resources between regions, industries, business entities) with an increasing role of the manufacturer financial services and products;

Strict supervision over the activities of banks by the Bank of Russia and other government agencies (mandatory standards, audits, multifaceted reporting, liquidity requirements, reserves);

A small share of equity in liabilities, a large share of borrowed funds, including borrowed funds, the short-term nature of liabilities.

Major role (in creating bank value) intangible assets: quality of business processes, organizational structure, staff qualifications, management system, etc.), including deposit insurance guarantees.

Significant risks associated with the structure and quality of assets and liabilities, the nature of the operations performed.

2.2 Main approaches used to estimate the market value

Traditionally, when assessing the market value of any asset and business, three approaches are used: cost, comparative and income. The calculation results, weighted by different methods, make it possible to obtain an integral assessment of the business value.

The cost approach consists in an element-by-element assessment of the market value of the bank's assets and liabilities and is due to the difference in the results of the balance sheet and market value components of the bank's assets and liabilities. When evaluating operating bank the method of net assets is used; when deciding on the liquidation or purchase of a bank, the liquidation value method is used. At the same time, it is possible to distinguish within cost approach and a number of auxiliary, specific valuation methods that make it possible to determine the market value of all components of the bank's assets by adequate methods (intangible assets, investments in securities, loan portfolio, currency portfolio, real estate, etc.) and liabilities (issued promissory notes, bonds, certificates, deposits, loans).

According to the letter Central Bank dated October 28, 1996 No. 350 “On the indicator of the value of net assets”, “net assets are assets free from liabilities, which corresponds to the concept own funds(capital) in relation to a credit institution. In this regard, in relation to the credit institution, instead of the indicator of net assets, the indicator of own funds (capital) is calculated.

Calculation book value of the bank's own funds (capital) is made on the basis of the Regulation of the Central Bank of the Russian Federation dated February 10, 2003 No. 215-P "On the Methodology for Determining the Own Funds (Capital) of Credit Institutions".

The market value of the bank's own capital under the cost approach (net asset method) will be determined as the difference between the market value of assets (assets revalued for inflation, market conditions, liquidity) and the market value of the bank's liabilities:

To assess the market value of some bank assets, methodological recommendations are used, approved by the Directive of the Central Bank of the Russian Federation dated November 13, 1997 No. 18-U “On Enactment new edition methodological recommendations on the procedure for evaluating measures for financial recovery (rehabilitation plans)”.

It should be noted that, despite the strict regulation of banks, the assessment of the market value of their assets, as well as equity and liabilities, is a very laborious process, because. requires detailed disclosure of inside information for each article.

The cost approach reflects the costs previously incurred to create an asset or liability and does not take into account the future flows generated by those assets or liabilities. In addition, in the practice of valuation of Russian banks, there is a problem of valuation of hidden assets. In Russian practice, hidden assets include, for example, friendly relations with the landlord, which allow significant savings on costs, personal connections of employees in business circles and authorities, the availability of unique banking technologies (products, analytical tools, workflow technology) that may be of interest to the buyer, the personal relationship of old employees with the clientele.

While complications rarely arise with the valuation of balance sheet obligations, hidden obligations - that is, obligations not recorded on the balance sheet and off-balance sheet accounts - can create big problems for the new owner. The main types of hidden circumstances, as modern practice shows, are unaccounted promissory notes and guarantees (and avalis, as varieties of guarantees). Such obligations arise either as a result of abuses by top management (hired managers), or as a result of certain settlements between bank participants. It is practically impossible for a potential buyer to identify unrecorded liabilities on his own - this is one of the main reasons that bank mergers and acquisitions in Russia are slow.

The comparative approach, like the cost approach, does not take into account the prospects for the development of the object of assessment. It cannot be applied if:

1) there is no active market for the relevant product (shares, assets);

2) there is no information, statistical data on quotations of banks' shares, mergers and acquisitions, on the results of evaluation of various banks.

The essence of the comparative approach methods (transaction method, capital market method, industry coefficient method) is to select an analogue object, collect data on its value and adjust it using a system of coefficients that reflect the differences between the valued object and the analogue object. Due to the underdevelopment of the market for bank shares, the lack of open, transparent data on the estimated or actual (market) value of banks and their shares, this approach is rarely used when assessing the market value banking business in Russia. Abroad, in the conditions of a developed stock market, including bank shares, this approach takes its rightful place in the assessment, even when assessing individual components of assets and liabilities.

The income approach is based on forecasting the bank's cash flows in the future and bringing them to the present (or future) point in time. For growing banks created on the basis of new customer service technologies. This approach to assessing the bank's business as a whole and its shares is the most appropriate.

The main methods used in the income approach are DCF methods (discounted cash flow), capitalization method, economic value added method (EVA), etc. An important principle of using the discounted cash flow method (DCF) is the separation of tasks:

1) assessment of the market value of a business or a company (bank) as a whole, based on the forecasting and discounting of free cash flow (FCF) generated by the activities of a bank with a certain structure of assets and liabilities;

2) assessment of the market value of the share (own) capital of the bank, based on the forecasting and discounting of the residual cash flow “to shareholders” (FCFE).

IN general view the formula for determining the market value of an asset (business) using the DCF method has a well-known form:

where CF is the cash flow generated by the asset (business) at the t-th point in time,

i - discount rate.

Given the stability (growth or decrease) of the cash flow in the long run, formula (3) takes the form:

where I is the capitalization rate.

The capitalization rate differs from the discount rate in that the discount rate is used in calculations for an unlimited time, and the capitalization rate corresponds to the limited time of the appraisal object.

CF is the average annual cash flow.

The method of calculating the market value of the appraisal object using formula (4) is known as the capitalization method and can be used with large assumptions when it is necessary to make an express valuation in a short time.

Tom Copeland highlights the following approaches to bank valuation:

external evaluation,

internal evaluation,

assessment of own (share) capital,

valuation of the bank as a whole.

In the same work, the author explains why he proposes to evaluate the value of the bank by share capital. However, in the activities of banks as commercial enterprises, the sale of their own products and services, rather than intermediary functions. Therefore, for banks as objects of assessment, the same principles and approaches should be applied (in particular, the “single object of assessment method” - Copeland), as for enterprises. real sector only taking into account differences in the components of the cash flow and factors affecting the formation of the value of the bank's own and borrowed capital.

To estimate the market value of shares in stable banks that pay dividends, the Gordon formula is used, using a rather simplified representation of the cash flow to shareholders:

where EPS is net profit per share:

PR - share of net profit paid in the form of dividends (payment ratio),

g - expected profit growth rates (for stable companies, g is taken in an amount not exceeding the average growth rate GDP growth in the economy of the country where the company is located).

Then Ve= PxN outstanding shares (6)

Examples of such banks are, in particular, Canadian banks with stable economic performance and stable PR. The model used to estimate the market value of Canadian banks is as follows:

where BV is the book value of the share,

ROE=ROA/(1-Debt)/Assets.

In accordance with modern foreign works in the field of valuation of companies in various industries, including banks, the market value of the company as a whole by the DCF method is determined by the formula:

where FCF is the net cash flow of the company, bank.

WACC is the weighted average cost of capital of a company or a bank.

There are different points of view on the concept of capital: some understand capital as the total liabilities of the company (equal to assets), others - liabilities minus short-term liabilities, abroad - liabilities minus cash (cash in the account and on hand). The authors adhere to the first point of view, understanding by common capital company or bank all its sources of financing (all liabilities).

The market value of the share capital (own) is determined by the formula:

where FCFE is the net cash flow “to shareholders” of the bank,

ke is the return required by investors for investing in the bank's shares.

For an aggregated assessment of the market value of equity capital as part of the bank's market value, along with formula (9), profit and spread models are used.

Since the duration of the forecasting period is uncertain, the formula for calculating the value of a business (company, bank) (8) is usually presented in the form of expression (10), which involves dividing the forecasting period into two segments (the first modification of the cost estimation formula). The first of them has a fixed duration (horizon), for example, 3-5 years, during which it is possible to forecast the company's sales volumes, the state of its macroeconomic environment and other factors that affect cash flow and the discount rate. For the second period, constant values ​​of the annual cash flow and discount rates typical for last year fixed forecast period. Accordingly, the company's value is the sum of the value on a fixed forecasting horizon and the value of the entire subsequent remaining period of its operation (residual value):

The second important modification of the formula for estimating the value of an operating company is a formula that provides for the division of the FCF flow into two components: 1 - the flow generated by the operating business of the company without taking into account the implementation of new investment projects, -- FCF0 and 2 - the flow generated by the company's promising projects in the future, -- FCFj:

where n is the number of new investment projects;

j is the project number.

Then the value of the company will look like this:

V = V0 + Vadd (12)

where V0 is the value of the company, subject to the development of the existing business and the types of products and services provided by the company at the time of settlement;

Vadd - additional value of the company associated with the implementation of new investment projects by the company, or a cost estimate of the prospects for its future growth, calculated by the formula:

Consequently, the value of the company when it implements effective (NPV > 0) investment projects increases by the value of the NPV of the projects being implemented:

The third modification of the formula for estimating the company's value is used if there is data from the last balance sheet of the company that allows you to calculate the capital invested in the company (equity and debt) and it is possible to estimate the company's market value added (MVA):

where BC is the book value of capital (own and borrowed)* invested in the company as of the last reporting date (according to the state of the balance sheet);

MVA -- economic value added (market added value), adjusted to the time of assessment (or last reporting date) using a discount rate equal to the weighted average cost of capital of the company at the time of valuation

(i = WACC) calculated by the formula:

(16) where EVA is economic value added.

3. METHODS BASED ON THE PRINCIPLE OF "RESIDUAL INCOME"

3.1 Economic value added (EVA) method

This method was developed by SternStewart & Co., allows you to calculate for each moment (period) of time the added value created by the bank (business as a whole) for the period under review, determined by the profitability (efficiency) of using assets (ROA) and the cost of all capital (the cost of servicing all components of liabilities - WACC):

bank market value added

where C t-1 - capital, total assets, totalassets, company (bank), then

where C is the total capital invested in the bank, equal to the bank's liabilities minus short-term accounts payable.

The added value created by the share capital of the bank is determined by the formula (Olson Model -EBO):

where ROE is the profitability (efficiency) of the bank's equity,

ke is the cost (maintenance) of equity capital, or the rate of return expected by shareholders on capital invested in shares.

E - the value of the bank's own capital (С=E+D).

Then the market value of the bank's equity capital is determined by the formula:

If EVA is positive, the bank is developing. If - negative - this is a signal for the deterioration of the financial condition and stability of the bank.

The EVA indicator determines the value created for all providers of capital for the company (bank): shareholders and creditors - therefore, WACC determines the minimum required level of return (discount rate). The EVAe indicator (Olson model) allows to evaluate the value created by the company for shareholders, and therefore the indicator ke, which reflects the minimum level of return, is used as the discount rate.

3.2 Cash value added method (CVA)

This method allows you to assess whether the income from the business covers the current costs and costs of servicing the sources of business financing used:

CVAt = OCFt - OCFDt, (21)

where OCF - operating cash flow,

OCFD = capital charges = cost of capital x capital - cash flow required (to service the entire capital of the company).

A positive CVA value indicates the sufficiency of the funds earned by the bank for its current activities.

Separately, we should dwell on the factors that increase the market value of the bank in Russia. First, the level of infrastructure and a monopoly position in the market (Sberbank). Secondly, transparency, that is, the bank's ability to show how revenues are generated and how they are distributed, what is the ownership structure. Thirdly, the quality of assets and the efficiency of bank investments. In an environment of strong fluctuations in interest rates, banks with high proportion stable fee income, which are less dependent on the business cycle.

CONCLUSION

Banking activity has its own specifics, which must be taken into account when developing the concept of assessment and the methodology for its implementation. In a market economy, a bank can be viewed as a commodity of a special kind with its inherent properties of utility and value. The consumer value of a credit institution is determined by the usefulness of the services provided. At the same time, the consumer value of the banking business is determined not only by the presence of a license for specific types of activities, but also by the added potential value of the resource base, the presence of a deposit guarantee (insurance) system. Along with the obvious signs of use-value banking services credit institutions have value.

The methodology for assessing the value of credit institutions is quite complex and little studied in Russia and abroad. Depending on the purpose of the assessment, approaches and methods are selected. For example, in a merger or takeover, it is preferable to treat the bank as a going concern and use an income approach to valuation. However, the application of this approach, taking into account the characteristics of the banking business, has a number of limitations, in particular, on the one hand, the amount of information; on the other hand, the absence of an established budgeting system in Russian commercial banks. IN modern conditions the choice should be made in favor of the capital valuation method. However, this method also requires taking into account the peculiarities of assessing the market value of liabilities that create potential added value to the object of assessment.

When introducing market valuation methods, one should rely on the simplest and most accessible method of net assets. However, this does not mean that the theory and practice of valuation activities should not be based on a more accurate valuation method - the discounted cash flow method and the income approach.

LIST OF USED LITERATURE

Regulation of the Central Bank of the Russian Federation of February 10, 2003 No. 215-P “Regulations on the Methodology for Determining Own Funds (Capital) of Credit Institutions”

Regulation of the Central Bank of the Russian Federation of March 26, 2004 No. 254-P "Regulation on the procedure for the formation by credit institutions of reserves for possible losses on loans, on loan and equivalent debt"

Instruction of the Central Bank of the Russian Federation of 2004 No. 110-I "On the mandatory ratios of banks"

Letter of the Central Bank of the Russian Federation of October 28, 1996 No. 350 "On the indicator of the value of net assets"

Directive of the Central Bank of the Russian Federation of November 13, 1997 No. 18-U “On the introduction of a new edition of guidelines on the procedure for assessing measures for financial recovery of 9 rehabilitation plans)”

Damodaran A. Investment appraisal. Tools and methods for valuation of any assets. 2nd ed. - M.: "Alpina Business Books", 2004.

Tom Copeland. “The value of companies. Evaluation and management”, 3rd edition, 2008.

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Kirov Socio-Economic College

Department of "Finance, taxation and lending"

COURSE WORK

Prepared by: Vesnensky Yu.L.

2nd year student, group 201-F

Checked by: Polivanov M.T.

Senior Lecturer

Kirov 20-09-2007

Introduction

The choice of specific approaches and methods for assessing a commercial bank is largely determined by the position of the specialist conducting the assessment - internal or external. When assessing the value of any asset and business, including a commercial bank, methods of three approaches can be used: cost, comparative and profitable. The author considers the advantages and disadvantages of each of them and dwells on a comparative approach.

Below 4 or 5 postscripts that will give out that you did not write the work.

Features of the assessment

The specifics of the functioning of a commercial bank as a type of financial institution determines a number of features for assessing its market value. Let's highlight the main ones.

1. High degree state regulation activities of a commercial bank. Banks are required to maintain at a certain level the values ​​of mandatory regulatory indicators for capital adequacy to ensure obligations, taking into account risk, liquidity of the balance sheet, and solvency. Banks are limited to areas of the economy in which they can place their funds; regulators restrict the entry of new companies into the market, as well as merger processes between existing companies. The presence of restrictions imposed on the activities of financial institutions by regulatory authorities, changes in their requirements or the expectation of such changes increase the uncertainty in the forecasts of the future activities of companies and affect their value.

2. The specifics of the activities of banks, the essence of which lies in the transformation of funds raised into different kinds financial products and placing the latter at a higher price than the attraction price forces analysts to consider borrowed funds, the debt of financial institutions not only as a way to finance their activities. Due to the presence of a positive spread between the average market level of costs for attracting financial resources and the actual costs of servicing them, managing liabilities creates additional value for the bank's shareholders. Therefore, commercial banks should be analyzed and evaluated only from the standpoint of assessing their own capital. In addition, commercial banks are characterized by a small share of their own and a significant share of borrowed funds in liabilities, which indicates a high degree of risk concentration and a significant impact of financial leverage on their activities and value.

3. Difficulties in determining net capital costs (reinvestment) and changes working capital.

4. Relative secrecy of information about the activities of a commercial bank.

5. Availability of intangible assets. Intangible assets play a significant role in the successful operation of a commercial bank: the quality of built business processes, the level of development organizational structure, management system, staff qualifications, quality of the customer base. For commercial banks, participation in the deposit insurance system (availability of state guarantees for deposit insurance individuals) is also an intangible asset that provides additional value.

6. Presence of specific activity risks. Commercial banks are characterized by the presence of significant risks associated with the structure and quality of assets and liabilities, the nature of the financial services provided, and the operations performed. Their activities are accompanied, along with other several specific types of risks - the risk of default on the loan, interest rate risk, the risk of reducing the liquidity of assets, currency and political risks.

The assessment of the market value of a commercial bank can be conditionally divided into an external assessment conducted by third-party analysts and an internal assessment conducted by insiders - trusted persons of banks. The main difference between the internal assessment of a commercial bank is that the analyst has a much larger amount of information, including information with limited user access and containing commercial secrets. When conducting an internal assessment, the expert has all the necessary data, including internal analytical materials bank about the types and structure of the loan portfolio, portfolios of securities, the structure of resources and their sources, the bank's costs, etc. Therefore, such an assessment differs from the external one by the greater competence of the analyst and is characterized by greater reliability of the result obtained.

There are three approaches to evaluation:

Expensive;

Profitable;

Comparative.

Cost approach

The cost approach to assessing the value of a commercial bank consists in the element-by-element determination of the market value of its assets and liabilities. The value of existing assets, net of debt and other claims, is the value of the bank's equity. To evaluate an operating bank, the net assets method and the excess profits method can be used; to evaluate bankrupt banks, the liquidation value method is used. The cost approach should be used when valuing a well-performing commercial bank with little or no growth potential, as this approach reflects the amount of past costs incurred to create an asset or liability, without taking into account possible future income and expense flows generated by it.

Cost approach methods are the most time-consuming and difficult to implement from the point of view of external evaluation, since data on the structure and characteristics of assets and liabilities, loan portfolio, interest rates and other confidential information can only be held by an analyst who has access to the bank's internal materials.

income approach

The income approach to valuation is based on the fact that the value of a commercial bank is equal to the present value of all future cash flows generated by it. Within the framework of this approach, the discounted cash flow method, the capitalization method, the economic value added method, etc. are usually used. Income approach methods, unlike the cost approach, reflect the potential profitability of the business, take into account possible changes in income in the future, allow taking into account the industry risk and the risk of a particular company. For commercial banks that are in the stage of their development, assuming a significant change in the scale of business and, accordingly, cash flows, the income approach is the main one in assessing their value.

However, the methods of the income approach, as well as the methods of the cost approach, are difficult to implement for an outside analyst who assesses the value of a bank from an external position. Thus, assessing the quality of a commercial bank's loan portfolio, determining operations that bring it real income, calculating the amount of such income, determining the difference in the cost of attracting and placing funds, analyzing the structure of bank income and expenses, building cash flows, forecasting their growth rates for an external user are a complex task, the solution of which is characterized by a significant proportion of assumptions and assumptions.

Comparative approach

The comparative approach to the valuation of a commercial bank is based on a comparison of the bank being assessed with its peers, in respect of which there is information on the prices of transactions with them or blocks of their shares. This approach assumes that the value of the equity capital of a commercial bank is determined by the amount for which it can be sold in the presence of a sufficiently formed market, that is, the most probable estimate of the value of the analyzed bank is the real sale price of a similar bank, fixed by the market. As part of the comparative approach, it is possible to use three methods - the method of transactions (sales method), the method of an analogue company (the capital market method) and the method of industry coefficients.

A comparative approach cannot be applied in cases where there is no developed market for the relevant assets or there is no information, statistical data on the amounts of purchase and sale transactions, mergers and acquisitions, and share quotations of analogues. Due to the underdevelopment of the bank share market, the lack of open, transparent data on the estimated or actual (market) value of banks and their shares, this approach was rarely used when assessing the market value of the banking business in modern Russia.

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Comparative Approach Methods

At present, favorable conditions are emerging for a wider use of methods of a comparative approach to assessing the market value of commercial banks - there is an intensive development of the Russian stock market, an increase in the number of purchase and sale transactions with blocks of shares of banks, mergers and acquisitions, and an increase in the degree of openness of the banking system. In addition, in the context of determining the market value of a commercial bank from the standpoint of an external assessment, the methods of a comparative approach are the main ones, since they allow the use of information only from open sources about the activities of both the assessed bank and selected analogues, and there is also no need to build the bank’s possible cash flows, determine structure and element-by-element evaluation of its assets and liabilities, which is fraught with significant difficulties for an external analyst.

As part of a comparative approach to assessing the market value of a business, the method of an analogue company and the method of transactions are most often used.

Peer company method

The analogue company method (capital market method) is based on the analysis of data generated by the open stock market. Based on the information of the stock market on the quotes of shares of commercial banks as a result of a thorough analysis of various financial ratios selection of banks - analogues of the bank being evaluated is carried out and estimated multipliers are calculated, which are the ratio of the market value of one share of the analogue (or market capitalization) and any of its financial indicators. The market value of the bank being valued is determined as the product of the selected valuation multiplier and the corresponding financial indicator of the bank. Since the basis for comparison in this method is the price of one share, in its pure form, the use of the method is possible to determine the market value of minority stakes in banks.

As of January 2007 listing stock exchanges RTS and MICEX include shares of only a few banks. Thus, in addition to the shares of OAO Sberbank of Russia, the RTS listing includes shares of OAO Uralsib, OAO Petrokommerts, OAO Stella-bank, OAO Bank Vozrozhdenie, OAO Sobinbank, OAO AKB ROSBANK, OAO Sibacadembank The MICEX listing includes securities of OAO Sberbank of Russia and OAO Bank Vozrozhdenie, OAO AKB ROSBANK. Outside the list, shares of OAO AKB Primorye, OAO AKB FinPromBank, OAO Bank of Moscow, OAO Far East Bank, OAO CB Yaroslavich, OAO Provincial Bank Tarkhany, OAO International Bank of St. Petersburg are traded. , JSC "Metkombank", JSC "Promstroibank", JSCB "Avangard". The most liquid are the shares of JSC "Sberbank of Russia", the daily turnover on the MICEX for them is several million dollars. Also, transactions with shares of JSC "Uralsib" have been regularly made lately ", OJSC "Bank" Vozrozhdenie", OJSC AKB "ROSBANK", OJSC "Bank of Moscow", OJSC "Promstroybank". For other shares, at best, isolated transactions are recorded or there are only quotes for buying and selling.

Thus, the stock market has information on the prices of the most liquid shares of banks, which are quite large both in terms of equity capital, assets, and profits, and cannot be analogues for the vast majority of Russian commercial banks. Therefore, in the present conditions, the application of the capital market method for the assessment of a Russian commercial bank is associated with significant difficulties, and the result obtained is characterized by low reliability. The capital market method can often be used only as an auxiliary method, and its result can only be used to confirm the results of cost calculation by other methods of the comparative approach.

Deal method

In most cases of assessing the market value of a commercial bank from external positions, the main method of the comparative approach, which guarantees the most reliable result, is the method of transactions. The transaction method is focused on the analysis of the acquisition prices of companies as a whole or their controlling stakes. The procedure for applying the analogue company method and the transaction method is practically the same, the difference lies only in the form of initial information used - data on the price of one share or data on the price of controlling blocks of shares. Currently, there is information on the market (and its volume is constantly growing) on ​​offers for sale and completed transactions with both minority and controlling stakes in commercial banks, which allows the analyst to apply the transaction method to assess the value of the banking business.

At the first stage of the implementation of the method of transactions, it is necessary to collect information of two types - market and financial. Market information includes data on the actual amounts of completed transactions with blocks of shares of various commercial banks, as well as information on the number of shares in circulation. Financial information is presented in the official accounting and financial reporting and other analytical materials characterizing the financial condition of commercial banks - the assessed and potential analogues.

On the basis of the obtained market information on completed transactions with blocks of shares of commercial banks, a general list of possible analogues of the assessed bank is compiled. Then the analysis of the entire volume of available financial information is carried out, the criteria for comparability and selection of analogues are determined.

Under the conditions of an external assessment, in order to compare the selected analogues, it is possible to analyze both absolute financial indicators of the activities of commercial banks - balance sheet, net assets, equity; total liabilities, net profit, etc., and relative ratios - return on equity (Return on Equity), return on assets (Return on Assets), capital multiplier (Equity Multiplier), net and operating profit margin (Net and Operating Margin ). It is most advisable to use ROA and ROE indicators, since they take into account the influence of other coefficients. However, the analysis of a larger number of analyzed financial indicators and ratios makes it possible to determine the most similar analogues and thereby obtain a more objective value of the market value of the bank being evaluated.

Along with the analysis of the financial performance of commercial banks, in order to determine the most comparable peer companies, it is also necessary to consider other characteristics of their activities, for example, the presence / absence of a branch network, established links and relationships with major private corporations and state enterprises, the degree of development of Internet and telebanking, etc. The choice of indicators for analyzing the activities of the assessed commercial bank and peer banks should be carried out individually in each specific case of the assessment.

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Estimated multiplier calculation

Important steps in assessing the market value of a commercial bank using a comparative approach are the choice of type and calculation of the estimated multiplier. The specifics of the banking business determines the predominant use of the following estimated multipliers - "Price / Profit" and "Price / Book value of equity capital". These multipliers are equity multipliers, and their use in comparative approach methods is consistent with the concept of valuing a commercial bank by equity.

The multiplier "Price / Earnings" (price-earning ratio - P / E) for a commercial bank is determined in the same way as for any other company, and is equal to the ratio of the price of one share of the bank to the profit attributable to one share. The P/E multiple is determined by three factors - the expected rate of earnings growth, the dividend payout ratio, and the cost of equity (cost of capital). As with other companies, higher P/E ratios correspond to banks with higher expected earnings growth, higher payout ratios, and lower capital costs.

Unlike other companies, the value of the P/E multiple of a commercial bank is influenced by the amount of reserves created by it to cover doubtful loans. More cautious, conservative banks that create large amounts of such reserves, thereby reduce their own profits and have a higher P/E multiple. When assessing the market value of a commercial bank by the transaction method (capital market), it is necessary to take this circumstance into account and make appropriate adjustments to the calculations.

The multiplier "Price/book value of equity" (price-book value - P/BV) for a commercial bank is the ratio of the price of one bank share to the book value of equity per share. This multiplier is determined by the following indicators: expected growth rate of earnings per share (g), dividend payout ratio, cost (cost of capital) (K)

and return on equity of the bank (ROE):

P/BV = (ROE - g): (K - g).

High values ​​of this multiplier are typical for a bank with high profit growth rates, an increased dividend payout ratio, lower capital costs and a high return on equity. For commercial banks, unlike other companies in the non-financial sector, there is a closer relationship between the value of the multiplier "Price / Book value of equity" and the return on equity.

The table presents the results of some transactions for the sale and purchase of controlling stakes in Russian commercial banks, which were made in the period 2005-2006. and information about which is available in open access. The figure shows an analysis of the correspondence between the P/BV multipliers of the considered transactions and the return on equity of commercial banks - objects of transactions.

Results of transactions with shares of commercial banks

─────────────────┬──────┬─────────┬──────────────┬──────────────┬────────┬────┬─────────

Transaction object │ Share, │ Amount │ Capitalization, │ Buyer │ Date │ P/BV │ ROE<*>,

│ % │ deals, │ mln USD │ │ deals │<*>│ %

│ from UK│mln USD│ │ │ │ │

Group │ 96.40 │ 477 │ 495 │OTR Bank │July │4.10│ 9

"Investsberbank" │ │ │ │ │ 2006 │ │

─────────────────┼──────┼─────────┼──────────────┼──────────────┼────────┼────┼─────────

OJSC AKB │ 10.00 │ 317 │ 3170 │Societe │September │3.87│ 8

"Rosbank" │ │ │ │Generale │2006 │ │

─────────────────┼──────┼─────────┼──────────────┼──────────────┼────────┼────┼─────────

Promek-bank │100.00│ 40 │ 40 │Societe │March │3.09│ 27

│ │ │ │Generale │2005 │ │

─────────────────┼──────┼─────────┼──────────────┼──────────────┼────────┼────┼─────────

CJSC "KMB-Bank" │75 - 1│ 90 │ 120 │Banca │April │2.96│ 25

│action │ │ │Intesa │2005 │ │

─────────────────┼──────┼─────────┼──────────────┼──────────────┼────────┼────┼─────────

OJSC │100.00│ 550 │ 550 │Raiffeisen │January │2.80│ 19

"IMPEXBANK" │ │ │ │International │2006 │ │

│ │ │ │Bank-Holding │ │ │

│ │ │ │AG │ │ │

─────────────────┼──────┼─────────┼──────────────┼──────────────┼────────┼────┼─────────

CJSC "MMB" │ 26.40 │ 395 │ 1496 │Hypo- │June │2.78│ 21

│ │ │ │Vereinsbank │2006 │ │

─────────────────┼──────┼─────────┼──────────────┼──────────────┼────────┼────┼─────────

OJSC │ 97.35│ 21 │ 22 │DnB NOR │October │2.26│ 3

"Monchebank" │ │ │ │ │2005 │ │

─────────────────┼──────┼─────────┼──────────────┼──────────────┼────────┼────┼─────────

CJSC │100.00│ 105 │ 105 │Societe │August │2.25│ 15

"Deltacredit" │ │ │ │Generale │2005 │ │

─────────────────┼──────┼─────────┼──────────────┼──────────────┼────────┼────┼─────────

CJSC "AKB" │100.00│ 58 │ 58 │Midzuho │October │1.27│ 5

"Michinoku Bank │ │ │ │Corporate │2006 │ │

(Moscow)" │ │ │ │ │ │ │

─────────────────┼──────┼─────────┼──────────────┼──────────────┼────────┼────┼─────────

JSC Credit │100.00│ 103 │ 103 │Gazprombank │December │1.23│ 26

Ural Bank" │ │ │ │ │ 2006 │ │

─────────────────┴──────┴─────────┴──────────────┴──────────────┴────────┴────┴─────────

Dependence of the P/BV multiplier on the ROE of commercial banks

4,50 ┬───────┬───────┬───────┬────────┬────────┬────────┐

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0 5 10 15 20 25 30

As follows from the data in the table and figure, the deals under consideration can be divided into groups. The first group consists of transactions in which the P/BV multiplier has an almost strict linear dependence on the return on equity of the bank - the object of the transaction (approximation coefficient R2 = 0.94). This group includes transactions with shares of Promek-bank, CJSC KMB-Bank, OJSC IMPEXBANK, CJSC MMB, CJSC Deltacredit and CJSC AKB Michinoku Bank (Moscow).

The second group includes other transactions, which, if their results are considered in conjunction with the results of transactions from the first group, lead to the impossibility of constructing a clear dependence of the P/BV multiplier values ​​on the return on equity of the banks that are the objects of transactions.

At the same time, for the results of three purchase and sale transactions - shares of banks of the Investsberbank group, OJSC AKB Rosbank and OJSC Monchebank - there is also a direct dependence of the values ​​of P / BV multipliers on the return on equity of banks, only in a rather narrow range - from 3 to 10%. It is obvious that for these two groups of transactions, apart from the return on equity, there were some other significant factors that determined the range of P/BV multiples and the final amount of the transaction.

As follows from the results of the analysis of transactions, the return on equity of a commercial bank - a potential object of acquisition (absorption) is one of the main, but not decisive, factors in the formation of the purchase price and, accordingly, the value of the P/BV multiplier. Thus, according to many experts, the high price paid by the Hungarian OTP Bank for the Investsberbank group was determined primarily by the presence of a developed branch network of the group and the lack of a similar offer on the market for the sale of a bank with a comparable presence in the regions. The low purchase price of Credit Ural Bank compared to other banks with a comparable return on equity can also be explained by the fact that given bank is local, regional bank.

Thus, for an analyst assessing the market value of a commercial bank using the comparative approach, it is necessary to take into account both the return on equity of the bank being assessed, as well as a significant number of other financial and economic indicators its activities, quantitative and qualitative characteristics, which will ultimately determine the possible range of the estimated P / BV multiplier and, accordingly, the market value of the bank.

At the final stage of the transaction method, the obtained values ​​of the valuation multipliers are used to determine the market value of the commercial bank being valued as the product of its corresponding financial indicator and the multiplier.

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Conclusion

The main advantage of the comparative approach to assessing the market value of a commercial bank is the use in the calculations of the actual purchase and sale prices of similar companies, fixed by the market. The analyst only makes the adjustments necessary to make peers comparable to the bank being valued, which ensures that the bank's true market value is obtained as a result. The result obtained reflects the real ratio of supply and demand for given object investment, since the prevailing price of the actual transaction most fully takes into account the market situation. In addition, the comparative approach allows for the most reliable assessment of the value of a commercial bank in a limited amount of information - in terms of an external assessment.

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Literature

1. Damodaran A. Investment appraisal. Tools and techniques for valuation of any assets. - M.: Alpina Business Books, 2004. - 1342 p.

2. Kidwell D.S., Peterson R.L., Blackwell D.W. Financial institutions, markets and money. - St. Petersburg: Peter, 2000. - 752 p.

3. Nikonova I.A. Estimates of the value of a commercial bank and its shares. - Corporate management.

4. Business Valuation: Textbook / Ed. A.G. Gryaznova, M.A. Fedotova. - M.: Finance and statistics, 2004. - 736 p.

5. Reshotkin K.A. Estimation of the market value of a commercial bank. - M.: TEIS, 2002. - 286 p.

6. Comparative approach to assessing the market value of a commercial bank "Management in a credit institution", 2007, N 4, S.A. Sekachev

7. My last name and the title of my coursework should be here

Tags: Estimation of the market value of a commercial bank Other finance, money, credit

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A modern commercial bank can be viewed from two perspectives: on the one hand, this enterprise is an active element of the market economy, performing the function of accumulating finances and providing them for temporary use by individuals and legal entities on the terms of payment, repayment and urgency. On the other hand, any commercial bank is an ordinary commodity, i.e. an object that can participate in a variety of market processes and transactions, for example, in buying and selling. However, in order to carry out these transactions, it is necessary to know the value of the goods, and it is for this reason that the need for valuation of a commercial bank arises.

This procedure is a sequential and purposeful process, the purpose of which is to determine actual cost the capital of the bank or its assets, and expressing this value in monetary terms, taking into account the factors of profitability, risks and time.

Market valuation of a commercial bank may be necessary for various reasons, for example:

• when restructuring an organization;
• when calculating the base for taxation;
• to improve the efficiency of management functions;
• when preparing a business for sale;
• to establish the creditworthiness of the organization;
• in order to determine investment attractiveness;
• if necessary, liquidation of the commercial structure;
• to substantiate management decisions;
• when restructuring a company (acquisition, merger);
• in order to maximize the value of the organization, etc.

The valuation of a commercial bank involves the valuation of the business in general, as well as comprehensive assessment assets and liabilities, including intangible assets that are not reflected in the balance sheet. This type peer review is considered the most difficult and time-consuming, because requires a deep retrospective analysis of data, making long-term forecasts, calculating price multipliers and financial ratios using financial mathematics systems.

The market value determined during the valuation of a commercial bank is calculated value equal to sum of money, relevant on the date of valuation, which the buyer is ready to pay for the acquired property, and which suits the seller.

In addition, the evaluation of the bank may be carried out to ensure its stable functioning, and be an integral element of the program of regulators aimed at preventing deterioration financial position and bankruptcy of the credit and financial structure.

Principles of valuation of a commercial bank

The assessment of the real value of a financial institution is carried out in strict accordance with generally accepted valuation standards. Simultaneously, banking structures are quite complex objects for evaluation due to the strict regulation of their activities and the secrecy of the main volume of internal information.

Russian commercial banks exist in various organizational and legal forms, such as LLC or CJSC, and the main problem lies in the assessment of their share capital, because. the shares of these organizations are not fully listed on the stock markets. In such cases, the expert pays great attention to the analysis relative indicators profitability of the bank, which are actually an alternative to the indicator of its stock price. This analysis is the best option for assessing the activities of a commercial financial structure.

The significance of the bank's profit is obvious. She plays an important role in economic life all persons who are with the bank in one way or another. Profit depends on factors such as interest charged and paid on various banking operations, share of non-interest income, current expenses, structure of assets and liabilities. An increase in profitability is usually achieved by increasing the efficiency of using all available assets by increasing the volume of working assets and reducing non-performing assets.