Irini Kalluci
Bank of Albania
Abstract
The banking industry is the most important element of the Albanian financial system and therefore it requires more attention when it comes to financial analysis. This paper handles theoretically and analytically some indicators of risk and performance, and for the first time ever, it presents a methodology for measuring a risk index for the Albanian banking system. Its aim is not simply to analyse some financial indicators or measures of risk and return, but, more importantly, to suggest some indicators and a risk index that may be helpful to supervisors during their work.
Keywords: banking system, financial ratio analysis, DuPont model, risk index.
JEL Classification: G21, G32
Acknowlegments: I would like to acknowledge helphul discussions with the workshop partcipants. I am mostly grateful to my discussants Rajna Hoxholli and Sofika Note for their constructive comments that helped me to improve the paper. The views expressed here are those of the author and do not necessarily reflect those of the Bank of Greece and the Bank of Albania. I alone am responsible for the remaining errors and omissions.
Correspondence:
Irini Kalluci
Research Department,
Sheshi “Skënderbej”,
No.1, Tirana, Albania.
Tel: ++355 42 222 152
Email: ikalluci@bankofalbania.org