Operating expenses divided by fee income plus tax equivalent net interest income.
The ratio of noninterest expense to total revenue. It is a productivity measure based on how well noninterest expense is managed and may be influenced by the level of revenue generated.
is the relationship between administrative expenses and operating revenues. The ratio measures the proportion of operating revenue necessary to cover these expenses. Administrative expenses = Expenses with personnel + Other administrative expenses + Tax expense, while Operating expenses = Gross financial margin + Revenue from Services + Other operating revenue + Other operating expenses).
Noninterest expense as a percentage of the total of net interest income and noninterest revenue (excluding restructuring costs, foreclosed property expense, special items and costs associated with the REIT).
Noninterest expense minus foreclosed property expense minus amortization of intangibles, expressed as a percentage of the sum of net interest income plus noninterest income. This ratio measures the proportion of net operating revenues absorbed by overhead expenses -- the lower the ratio the greater the operating efficiency of the institution.
(aka Working Ratio): measure of financial performance expressing total annual operational expenses as a % of pretax revenues. A ratio greater than 1.0 indicates a loss on current account. A ratio well below 1.0 is needed to contribute to capital investment.
A measure of how a financial institution is utilizing its' employees, facilities and operations to create profits. The ratio is calculated by taking the non-interest expense and dividing it by the sum of the net interest income and non-interest income. Institutions continually try to lower their efficiency ratio as that will result in higher profits. fficiency Ratios See Efficiency Ratio.
A ratio that expresses the total operating expenses as a percentage of total income of the banking operations. A 68% ratio implies that a company has to spend 68 cents to earn a revenue of one euro.
The efficiency ratio of a business is expenses as a percentage of revenue (expenses / revenue) with a few variations. A lower percentage is better since that means expenses are low and earnings are big. It's the "reverse" operating leverage: revenue / expenses.
