Financial Term Definitions

Transcription

1 Financial Term Definitions BALANCE SHEET Cash and Due from Banks Cash, petty cash, balances in banks, including noninterest bearing deposits Reserves from Central Bank Cash reserves in a central bank Short Term Financial Treasury bills and other short term investments, including interest-bearing deposits, convertible to cash within 12 months. Usually used in liquidity management. Net Gross minus Loan Loss Reserve Gross All outstanding principal for all outstanding client loans, including current, delinquent and restructured loans, but not loans that have been written off. It does not include interest receivable. It does not include employee loans. (Loan Loss Reserve) The portion of the gross loan portfolio that has been expensed (provisioned for) in anticipation of losses due to default. This item represents the cumulative value of the loan loss provision expense, less the cumulative value of loans written off. Interest Receivable Interest receivable on all asset accounts. Recorded by institutions using accrual accounting. Accounts Receivable and Other Accounts receivable, notes receivables and other receivables. This includes all receivables other than client loan accounts, including employee loans. Long Term Financial Long term investments not convertible to cash within 12 months Net Fixed The purchase value of property, plant and equipment, less accumulated depreciation. This includes intangibles, such as MIS development or goodwill, less accumulated amortization. TOTAL ASSETS Total of all net asset accounts Demand Deposits Total of Voluntary and Compulsory Savings Voluntary Savings Demand deposits from the general public and members that are not maintained as a condition for accessing a current or future loan and are held with the institution Compulsory Savings Client savings accounts that are maintained as a condition for a current or future loan and are held with the institution Time Deposits Certificates of deposit or other fixed term deposits Borrowings Total of Commercial and Concessional Borrowings Borrowings at concessional interest rates Principal balance of all borrowings, including overdraft accounts, for which the institution pays a nominal rate of interest that is less than the local commercial interest rate Borrowings at commercial interest rates Principal balance of all borrowings, including overdraft accounts, for which the institution pays a nominal rate of interest that is greater than to or equal to the local Financial Term Definitions & Indicators 1

2 commercial interest rate Interest Payable Accounts Payable and Other Liabilities TOTAL LIABILITIES Paid-in Captial Donated Equity Prior Years Current Year Retained Earnings Prior Years Current Year Adjustments Inflation Adjustment Subsidized Costs of Funds Adjustment In-Kind Subsidy Adjustment Reserves Other Equity Accounts TOTAL EQUITY TOTAL LIABILITIES AND EQUITY Financial Term Definitions Interest payable on all liability accounts. Recorded by institutions using accrual accounting. Other liabilities including tax and salary liabilities, social withholdings, deferred income, other accounts payable, including liabilities that do not fund the portfolio, such as mortgages on real estate. Total of all liability accounts Capital paid by shareholders or members Accumulated donations Accumulated donations from prior periods Donations from the current year Accumulated net income after taxes and before donations Accumulated net income after taxes and before donations from prior periods Net income after taxes and before donations from the current year Value of all adjustments, including inflation adjustment Value of inflation adjustment expense Value of subsidized cost of funds adjustment expense Value of in-kind subsidy adjustment Reserves such as those imposed by law or statute. Other equity accounts not included elsewhere Total of all equity accounts Total of Total Liabilities and Total Equity INCOME STATEMENT Financial Revenue Total of revenue from loan portfolio and other financial assets, as well as other financial revenue from financial services Financial Revenue from Total interest, fees and commission on loan portfolio Interest on Interest earned on loan portfolio Fees and Commissions on Penalties, commissions and other fees charged on loan portfolio Financial Revenue from Other Financial Net gains on other financial assets Other Revenue Related to Financial Services Financial Expense Other revenue from provision of financial services, including revenue from insurance or transfer services or non-financial revenue from the provision of financial services, such as the sale of passbooks or SmartCards. This account also include net exchange gains. Total of financial expense on liabilities, net inflation adjustment, cost-of-funds adjustment and other expenses from financial services Financial Term Definitions & Indicators 2

3 Financial Expense on Liabilities Interest and Fess Expense on Deposits Interest and Fee Expense on Borrowings Net Inflation Adjustment Expense Inflation Adjustment Expense Inflation Adjustment Revenue Subsidized Cost-of-Funds Adjustment Expense Other Financial Expenses Total of interest and fees paid on deposits and borrowings Interest and fees paid on demand or term deposits. Interest and fees paid on borrowings. Reserved for institutions that use inflation based accounting. Net amount of inflation adjustment. Cost of maintaining the value of the institution's equity Gain on the value of fixed assets due to inflation Adjustment expense for difference between market rate and concessional rate on borrowings. Other expenses from provision of financial services, including non-financial expenses on financial products, as well as net exchange depreciation. NET FINANCIAL INCOME Financial Revenue minus Financial Expense Net Loan Loss Provision Expense Sum of loan loss provision expense and recovery on loans written off. Loan Loss Provision Expense Loan Loss Provision Expense for the period Recovery on Loans Written-Off Total recovery on loans written off Operating Expense Total of Personnel Expense and Administrative Expense Personnel Expense Salaries, withholdings, fringe benefits and personnel taxes paid on all those who work for the institution Administrative Expense Total of Rent and Utilities, Transportation, Office Supplies, Depreciation and Other Administrative Expenses Rent and Utilities Rent and utility charges Transportation Transportation of staff to attend to clients and to manage operations Office Supplies Printed matter, supplies, photocopies, books, etc. Depreciation and Amortization Allowance for deterioration, eventual replacement of equipment Other Administrative Expenses Other non-personnel administrative expenses NET OPERATING INCOME Financial Revenue less Financial Expense, Net Loan Loss Provision Expense and Operating Expense Net Non-Operating Income Non-operating Revenue less Non-operating Expense Non-Operating Revenue Revenue from activity unrelated to the MFI's core activity of providing financial services. This could include consulting income, sale of IT products, or fees for business development services (BDS). Non-Operating Expense Expenses from activity unrelated to the MFIs core activity of providing financial services, such as BDS development costs or consulting expenses NET INCOME (BEFORE TAXES AND Net Operating Income less Net Non-operating Income DONATIONS) Taxes Includes all taxes paid on Net Income or other measure of profits as defined by local tax authorities. NET INCOME (AFTER TAXES AND BEFORE Net Income (before Taxes and Donations) less Taxes DONATIONS) Donations to Subsidize Financial Services Donations made to the MFI to subsidize its operations Financial Term Definitions & Indicators 3

4 NET INCOME (AFTER TAXES AND DONATIONS) Net Income (after Taxes and before Donations) plus Donations. Indicator Definitions INSTITUTIONAL CHARACTERISTICS Number of MFIs Sample size of group Age Years functioning as an MFI Total Total, adjusted for Inflation and standardized loan portfolio provisioning and write-offs Offices Number, including head office Personnel Total number of employees FINANCING STRUCTURE Capital/ Asset Ratio Adjusted Total Equity/ Adjusted Total Commercial Funding Liabilities Ratio All liabilities with "market" price/ Adjusted Gross Debt/ Equity Ratio Adjusted Total Liabilities/ Adjusted Total Equity Deposits to Loans Voluntary Savings/ Adjusted Gross Deposits to Total Voluntary Savings/ Adjusted Total Gross / Total Adjusted Gross / Adjusted Total OUTREACH INDICATORS Number of Active Borrowers Number of borrowers with loans outstanding, adjusted for standardized write-offs Percent of Women Borrowers Number of active women borrowers/ Adjusted Number of Active Borrowers Number of Loans Outstanding Number of loans outstanding, adjusted for standardized write-offs Gross Gross, adjusted for standardized writeoffs Average Loan Balance per Borrower Adjusted Gross / Adjusted Number of Active Borrowers Average Loan Balance per Borrower/ GNI per Adjusted Average Loan Balance per Borrower/ GNI Capita per Capita Average Outstanding Balance Adjusted Gross / Adjusted Number of Loans Outstanding Average Outstanding Balance/ GNI per Capita Adjusted Average Outstanding Balance/ GNI per Capita Number of Voluntary Savers Number of savers with voluntary savings demand deposit and time deposit accounts Number of Voluntary Savings Accounts Number of voluntary savings demand deposit and time deposit accounts Voluntary Savings Total value of voluntary savings demand deposit and time deposit accounts Average Savings Balance per Saver Voluntary Savings/ Number of Voluntary Savers Average Savings Account Balance Voluntary Savings/ Number of Voluntary Savings Accounts MACROECONOMIC INDICATORS GNI per Capita US Dollars GDP Growth Rate Annual Average Deposit Rate % Financial Term Definitions & Indicators 4

5 Inflation Rate % Financial Depth M3/ GDP OVERALL FINANCIAL PERFORMANCE Return on Adjusted Net Operating Income, net of taxes/ Adjusted Average Total Return on Equity Adjusted Net Operating Income, net of taxes/ Adjusted Average Total Equity Operational Self-Sufficiency Financial Revenue/ (Financial Expense + Net Loan Loss Provision Expense + Operating Expense) Financial Self-Sufficiency Adjusted Financial Revenue/ Adjusted (Financial Expense + Net Loan Loss Provision Expense + Operating Expense) REVENUES Financial Revenue Ratio Adjusted Financial Revenue/ Adjusted Average Total Profit Margin Adjusted Net Operating Income/ Adjusted Financial Yield on Gross Portfolio (nominal) Revenue Adjusted Financial Revenue from / Adjusted Average Gross Yield on Gross Portfolio (real) (Adjusted Yield on Gross Portfolio (nominal) - Inflation Rate)/ (1 + Inflation Rate) EXPENSES Total Expense Ratio Financial Expense Ratio Loan Loss Provision Expense Ratio Operating Expense Ratio Personnel Expense Ratio Administrative Expense Ratio Adjustment Expense Ratio EFFICIENCY Operating Expense/ Personnel Expense/ Average Salary/ GNI per Capita Cost per Borrower Cost per Loan PRODUCTIVITY Borrowers per Staff Member Loans per Staff Member Adjusted (Financial Expense + Net Loan Loss Provision Expense + Operating Expense)/ Adjusted Average Total Adjusted Financial Expense/ Adjusted Average Total Adjusted Net Loan Loss Provision Expense/ Adjusted Average Total Adjusted Operating Expense/ Adjusted Average Total Adjusted Personnel Expense/ Adjusted Average Total Adjusted Administrative Expense/ Adjusted Average Total (Adjusted Net Operating Income - Unadjusted Net Operating Income)/ Adjusted Average Total Adjusted Operating Expense/ Adjusted Average Gross Adjusted Personnel Expense/ Adjusted Average Gross Adjusted Average Personnel Expense/ GNI per capita Adjusted Operating Expense/ Adjusted Average Number of Active Borrowers Adjusted Operating Expense/ Adjusted Average Number of Loans Adjusted Number of Active Borrowers/ Number of Personnel Adjusted Number of Loans Outstanding/ Number of Financial Term Definitions & Indicators 5

6 Borrowers per Loan Officer Loans per Loan Officer Voluntary Savers per Staff Member Savings Accounts per Staff Member Personnel Allocation Ratio RISK AND LIQUIDITY Portfolio at Risk > 30 Days Portfolio at Risk > 90 Days Write-off Ratio Loan Loss Rate Risk Coverage Non-earning Liquid as % Total Current Ratio Personnel Adjusted Number of Active Borrowers/ Number of Loan Officers Adjusted Number of Loans Outstanding/ Number of Loan Officers Number of Voluntary Savers/ Number of Personnel Number of Saving Accounts/ Number of Personnel Number of Loan Officers/ Number of Personnel Outstanding balance, loans overdue> 30 Days/ Adjusted Gross Outstanding balance, loans overdue> 90 Days/ Adjusted Gross Value of loans written-off/ Adjusted Average Gross Adjusted Write-offs, net of recoveries/ Adjusted Average Gross Adjusted Loan Loss Reserve/ PAR > 30 Days Adjusted Cash and banks/ Adjusted Total Short Term / Short Term Liabilities Financial Term Definitions & Indicators 6