Emerging economies improve cost/income ratio as the developed world slips back

摘要

The Banker collects cost/income ratio data from banks as a measure of efficiency among banks across the globe. While methodology among banks across regions varies and there are regional variations in what is included, The Banker hopes to provide a global picture, but it is determined by banks' approach to this measure. The calculation divides operating expenses, including depreciation but without provisions, by the sum of the net interest income and non-interest income. The higher the ratio, the more inefficient the bank or group of banks are deemed to be. Japan continues to be the country with the highest cost/income ratio but this year the ratio has deteriorated, indicating declining efficiency. In the 2008 ranking, Japan's ratio rose to 73.61%, up from 69.39% in last year's ranking. With seven of the Top 10 banks in Japan producing reduced pre-tax profits, and profits at most other Japanese banks in decline, the income side of the ratio was reduced, causing efficiency to weaken.