Banking KPI to include some measures that are quantifiable, measurable and specific. It can be classified into six categories, such as income standards, cost measures, and measures of company assets, standards, investment, and measures of interest margin, and measures of risk.
KPI or key performance indicators and benchmarks used to measure the progress of the organization towards achieving its objectives. These standards can be financial or non-financial in nature. The customer satisfaction is common measure used by the companies. This can also be the metric used in the financial industry.
if it meets many customers by the business, which means literally good progress for the business. However, the vision and knowledge of customers satisfied with the product or service is not enough. It is also important for business to have a mathematical and statistical information regarding customer satisfaction.
organization can determine not only on the data included in the financial statements and progress. You must also manage the current measures of performance and progress of the organization appear.
standards, such as key performance indicators, and more common to evaluate the company's performance on different areas and activities. Standards as mentioned above can be divided into various measurements.
In the category of income standards, a company can measure the performance of income through the following measures: gross profit, the level of non-interest income, the level of fee income, and the spread of interest.
gross profit is a common element in the statement of income and expenses for companies. And it is calculated by deducting the cost of sales to sales.
fee income level in the case of service companies can be derived by dividing operating income to income from fees. On the other hand, non-interest income divided by operating income results for the level of non-interest income.
Computing to spread interest involves a complex equation. To derive the amount of interest spread, interest income divided by sales to earn interest. It is deducted as a result of the first equation to the proportion of liabilities interest expense and interest bearing.
At the same time, the measurement of the cost of the business process can be done by using different ratios such as: the cost of the asset ratios, the ratio of overhead costs, and cost of revenue. The cost of a derivative asset ratios by dividing the average assets during the period from operating expenses. Overhead costs and sales ratio produces the proportion of overhead costs, while operating expenses divided by total operating income results of the cost to income ratio.
return on capital employed, return on capital employed and return on shareholders' equity is the investment standards. These measures included tax and capital and profits, and benefits.
measurements interest margin, meanwhile, is based on the profit margin. To derive the profit margin, you have to divide the amount of sales to the amount of the profits. Operating margin and the margin interest and other measures in the interest margin category. Operating profit divided by sales produced operating margin, while the difference in interest income and interest expense divided by average interest earning assets is the equation to arrive at a net interest margin.
includeto measure the performance of non-performing assets of the company assets, and return on average assets, and reserve requirements. Risk standards, on the other hand, include capital and value measurements prone to danger adequacy ratio.
could be banking KPI similar in different banks. These standards have quantifiable attributes. A banking entity to measure the quantifiable and measurable standards abstract, and Balanced Scorecard can be used.
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