EconPapers    
Economics at your fingertips  
 

Between Parcimony and Complexity: Comparing Performance Measures for Romanian Banking Institutions

Anca Munteanu and Petre Brezeanu ()
Additional contact information
Anca Munteanu: Academy of Economic Studies, Bucharest, Romania

Annals of the University of Petrosani, Economics, 2012, vol. 12, issue 1, 225-232

Abstract: The main objective of this study is to establish the relationship between traditional measures of performance (ROE, ROA and NIM) and EVA in order to gain some insight about the relevance of using more sophisticated performance measurements tools. Towards this end the study uses two acknowledged statistical measures: Kendall’s Tau and Spearman rank correlation Index. Using data from 12 Romanian banking institutions that report under IFRS for the period 2006-2010 the results suggest that generally EVA is highly correlated with Residual Income in the years that present positive operational profits whereas for the years with negative outcome the correlation is low. ROA and ROE are the measure that best correlates with EVA for the entire period and thus -applying Occam’s razor- could be used as a substitute for more complex shareholder earnings measures.

Keywords: performance measures; banking sector; Economic Value Added; Residual Income (search for similar items in EconPapers)
JEL-codes: G21 L25 (search for similar items in EconPapers)
Date: 2012
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1) Track citations by RSS feed

Downloads: (external link)
http://upet.ro/annals/economics/pdf/2012/part1/Munteanu-Brezeanu.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:pet:annals:v:12:y:2012:i:1:p:225-232

Access Statistics for this article

More articles in Annals of the University of Petrosani, Economics from University of Petrosani, Romania
Bibliographic data for series maintained by Imola Driga ().

 
Page updated 2022-01-08
Handle: RePEc:pet:annals:v:12:y:2012:i:1:p:225-232