Your task is to analyse a bank’s financial and income statements, before and after the Global Financial Crisis. You need to collect the statements from a bank of your choice (preferably from a British bank or a bank from your country of preference, as long as the statements are available in English), for the years 2007 and 2016 (i.e. the statements before and after the global financial meltdown).
- Discuss the purpose of financial reporting and the potential problems that might emerge due to mishandling/misreporting financial data. (20 marks)
- Present and analyse the composition of assets and liabilities of the bank, before and after the global financial crisis of 2007/8. Identify any differences, especially in terms of the use of capital and the potential exposures to credit and default risks and capital adequacy? (30 marks)
- Using some of the key profitability ratios discussed in the class, provide a comparative discussion of the income statements before and after the financial crisis periods. (30 marks)
- Based on your previous analysis, provide some recommendations to the bank’s board, on how to improve performance in the following years. Focus on issues related to profitability, risk exposures, sources of income for the bank, as well as the use of the bank’s funds. (20 marks)