TABLE OF CONTENTS | EXECUTIVE SUMMARY | 3 | INDUSTRY BACKGROUND | 4 | COMPANY PROFILE | 6 | RATIO ANALYSIS | 8 | ANALYSIS OF OPERATING ACTIVITIES | 9 | ANALYSIS OF INVESTING ACTIVITIES | 11 | ANALYSIS OF FINANCING ACTIVITIES …show more content…
is the industry leader followed by JP Morgan Chase & Co. with 15.9% market share while the Citigroup Inc. ranks fifth with 5.5% market share (Andrews, 2011).
Banking industry is currently operating in the maturity stage. There are many players as a result of which the competition is quite high. Competition is broadly based on the levels of fees charged, reputation, the range of services and products provided. As the industry consolidates and the range of services broadens, the size and geographic spread of industry players in increasing. Providing a high set of barriers is the capital and regulatory requirements within the banking sector. Entities that want to start up as a commercial bank and/or investment bank or securities dealer face significant establishment costs in order to gain acceptance and meet market reputation. Furthermore, start-ups require up-front expenses in order to establish proper distribution channels. Globalization is high and the trend is increasing. Cross-border sales and acquisitions of banking operations are also occurring, as assets are shuffled in the race to raise capital.
The cyclical nature of the industry results in it having very high revenue volatility. When economic and financial market conditions are good, this industry tends to perform well. When the financial markets turn downward, revenue is often hit hard and early. In terms of the industry assistance, there was little support before the subprime
The banking industry has undergone major upheaval in recent years, largely due to the lingering recessionary environment and increased regulatory environment. Many banks have failed in the face of such tough environmental conditions. These conditions
Wells Fargo shows a much higher profitability ratio than Samsung, with over 8X that of Samsung. This is to be expected as services are typically more profitable than hardware sales which operate on leaner margins. Wells Fargo also outperforms Samsung significantly on return on sales with over 25X better performance. This again is attributable to better margins on services than hardware. Wells Fargo has a much stronger return on equity than Samsung with a Dupont ratio over 5X higher than Samsung's. Samsung has a stronger financial leverage ratio than Wells Fargo with almost 20% lower ratio for Samsung. Samsung also has a much lower total asset turnover than Wells Fargo. This is attributable to the quick turnover of assets in the manufacturing industry compared to the slow turnover of assets in the financial services sector.
There are various categories of banking; these include retail banking, directly dealing with small businesses and persons. Commercial and Corporate banking which offers services to medium and large businesses (Koch & MacDonald 2010). Private banking, deals with individuals, offering them one on one service. The last category is investment banking. These help clients to raise capital and often invest in financial markets. Most global banking institutions provide all these services combined. With all these institutions in existence within the same localities and offering similar services, there is a need to regulate the industry so as to protect the consumer and provide fair working environment for all banks (Du & Girma, 2011).
As noted in Wikipedia Oracle is headquartered in Redwood, California. It was founded in 1977 and is the world's third largest soft wear developer in sales. According to Yahoo Finance Oracle is a multi-faceted operation. Oracle provides a vast amount of services for the internet and computer. It provides cloud applications, IT consulting services, licenses middleware software which includes database and database management. It has 115,000 full time employees and is run by co-founder, CEO Larry Ellison who has been the only CEO of the company since it's inception. Also noted in Wikipedia he is the top paid CEO in the world. In 2013 Oracle
3. What are each of the financial statements commonly called in for-profit health care organizations and in not for-profit care organizations?
In order to be de-recognized, assets must be isolated from the transferor and put beyond the reach of creditors and receivers. This standard is commonly referred to as meeting “true sale” criteria. To qualify as a true sale; the transferor must surrender effective control over the
Economic: The industry’s performance is highly tied in with the economy. A weak economy will mean weak sales.
The banking industry is highly competitive. The financial services industry has beenaround for hundreds of years and just about everyone who needs banking servicesalready has them. Because of this, banks must attempt to lure clients away fromcompetitor banks. They do this by offering lower financing, preferred rates andinvestment services. The banking sector is in a race to see who can offer both the
The sector offers a considerable barrier to new entrants due to the high capital required to establish a new bank. As banking is professional services type required high creditability, strong brand presence is the key obstacle for newcomers.
Landry’s Debt to Asset ratio also increased from year 2002 to 2003. In 2002 Landry had a debt to asset ratio of 0.39. In 2003 Landry’s debt to asset ratio increased to 0.45. While both numbers are acceptable and considerably low, the increase from 2002 to 2003 could influence potential investors to not invest in Landry’s stock. This increase also suggests that Landry’s debt also increased from 2002 to 2003. Overall, while there was a slight increase from 2002 to 2003 Landry’s still had a good debt to asset ratio. We think that a contributing factor to the debt
Currently, there are no known specific restrictions on the number of new financial service institutions allowed into the industry each year. However, the regulatory burden placed on financial institutions has controlled, or perhaps diminished, the number of new bank charters over the last 10 years (Adams & Gramlich, 2014). This is particularly true for the smaller, traditional banks and a result of regulatory demand placed on the financial services industry since the 2008 financial crisis. Prior to 2008, the annual new charters were in the triple digits; however, ten years later new charters have declines into the single digits (Adams & Gramlich, 2014).
Lately, the international financial integration has increased. Over the years, the world economy has witnessed an increase in the number of individuals and businesses using international banking services. In today’s competitive global economy banks have the option to solely service their home market, to export services to foreign markets, or to establish a presence in that market. Essentially, banks have two options of expanding their operations in foreign markets. They can either service foreign clients through their domestic offices or they can establish a presence in the foreign markets. In general, the reasons for bank internationalization in
Private banking industry has changed in a very basic way, driven by many key factors such as: free competition systems, modern developments in information technology (in particular, developments of the internet), and changing demographics. Private banks now operate in an environment shaped by increasing and shifting regulations, and in markets influenced by the uncontrolled situations of the world economy and geopolitical issues.
The banking industry, due to its intricate nature has been encountering problems, such as capital inadequacies, excessive liquidity, bank distress and subsequent legibility in order to minimize and eradicate
The recent guidelines on New Bank Licenses by RBI have opened the doors for the entry of third set of private banks into the 73 trillion banking sector. Taking a look at the non-financial players like Aditya Birla Nuvo Ltd, Reliance Capital Ltd, L&T Finance Holdings Ltd, and Bajaj Finserv Ltd.which having a past record of sound credentials and integrity along with being financially sound have run the competition. Not only that, with a successful track record of 10 years, one would normally hope of improved productivity of the banking sector, which has been seen stagnating over the last few years and this gives a new opportunity for new