During the recent 2021 session of the Graduate School of Banking at LSU there were no students to be found walking underneath the stately oaks. Instead, most students attended their sessions virtually, watching via Zoom and engaging in discussion through chat panes and webcams. And, although they may have missed the in-person interaction with their classmates and festivities like the annual crawfish boil, they were still able to participate in insightful discussions and educational classes like Managing Bank Performance. This junior course instructed by Professor Paul Allen focuses on measuring and managing bank performance, using ratio and peer analysis and is a vital component in helping students prepare for their third year Bank Simulation Management course. The in-depth course includes an overview of a typical bank balance sheet and income statement, the definition and use of commonly used ratios, and uses case studies to illustrate how to evaluate bank performance.
Why do we provide this level focus on managing bank performance? There are certainly many reasons this particular aspect of banking is so important, but allow us to list four of the most impactful. Effective performance management is vital to:
- Assist in strategic planning
- Increase shareholder loyalty
- Provide a dependable source of new capital
- Improve bank valuation