社区银行受益于多元化【外文翻译】.doc

1、毕业论文外文翻译出处JOURNALOFFINANCIALSERVICESRESEARCH作者KEVINJSTIROH原文DOCOMMUNITYBANKSBENEFITFROMDIVERSIFICAIONABSTRACTTHISPAPEREXAMINESTHELINKBETWEENDIVERSIFICATIONANDRISKADJUSTEDPERFORMANCEFORSMALLCOMMUNITYBANKSTHERESULTSSHOWDIVERSIFICATIONBENEFITSWITHINBROADACTIVITYCLASSES,BUTNOTBETWEENTHEMSPECIFICBUSINESS

2、LINESARELINKEDWITHVERYDIFFERENTEXPOSTOUTCOMES,HOWEVER,SOTHEMIXOFACTIVITIESISALSOIMPORTANTINPARTICULAR,ANINCREASEDFOCUSONNONINTERESTINCOMEGENERATINGACTIVITIESISASSOCIATEDWITHDECLINESINRISKADJUSTEDPERFORMANCE,ASARECOMMERCIALANDINDUSTRIALLENDINGANDTRADINGTHISISAPOTENTIALDARKSIDEOFTHESEARCHTODIVERSIFYAS

3、MANAGERSMAYENTERBUSINESSESWHERETHEYHAVELITTLEEXPERIENCEORCOMPARATIVEADVANTAGEAFINALSETOFRESULTSSHOWSSIGNIFICANTDIFFERENCESINTHEDETERMINANTSOFRISKADJUSTEDPERFORMANCEFORCOMMUNITYBANKSRELATIVETOLARGERBANKS,WHICHSUGGESTSTHATACOMPETITIVEOPPORTUNITYREMAINSFORCOMMUNITYBANKSINTRODUCTIONDESPITETHEIRSMALLSIZE

4、,COMMUNITYBANKSAREAVERYDIVERSESETOFINSTITUTIONSWITHWIDEVARIATIONINBOTHBUSINESSSTRATEGIESANDEXPOSTOUTCOMESTHISHETEROGENEITYISAPPARENTINTHELARGEDIFFERENCESINREVENUESOURCES,LOANPORTFOLIOMIXES,ANDPROFITABILITYIN2000,FOREXAMPLE,SOMECOMMUNITYBANKSEARNEDALLTHEIROPERATINGREVENUEFROMINTERESTGENERATINGACTIVIT

5、IES,WHILEOTHERSFOCUSSEDONOTHERSOURCESLIKEFEEINCOME,FIDUCIARYACTIVITIES,ORTRADINGSIMILARVARIATIONISSEENWITHINTHELOANPORTFOLIOASSOMECOMMUNITYBANKSCONCENTRATEENTIRELYINREALESTATELENDING,WHILEOTHERSPERFORMONLYCOMMERCIALORCONSUMERLENDINGFINALLY,SOMECOMMUNITYBANKSCONSISTENTLYPOSTRETURNSONEQUITYNEAR20,WHIL

6、EOTHERSSAWPERSISTENTLOSSESTHEDIFFERENCESINSTRATEGICFOCUSALLOWANALYSISOFONEPARTICULARFACTORTHATMIGHTCONTRIBUTETOTHEVARIATIONINOUTCOMESDIVERSIFICATIONBENEFITSFROMREDUCEDCONCENTRATIONINASINGLEBUSINESSLINEWHILEONEMIGHTEXPECTDIVERSIFICATIONTODIRECTLYREDUCERISK,RECENTRESEARCHFORUNITEDSTATESBANKSHASBEENMIX

7、EDMOSTOFTHESESTUDIES,HOWEVER,HAVEFOCUSSEDONTHELARGE,COMPLEXBANKINGINSTITUTIONSTHATDOMINATEUNITEDSTATESBANKINGANDRELATIVELYLITTLEISKNOWNABOUTPOTENTIALDIVERSIFICATIONBENEFITSFORCOMMUNITYBANKSTHISISANIMPORTANTISSUEBECAUSETHESEBANKSSTILLPLAYACRITICALROLEINTHEUNITEDSTATESFINANCIALSYSTEM,ESPECIALLYFORSMAL

8、LBUSINESSESANDCONSUMERSSMALL,INFORMATIONALLYOPAQUEBORROWERSAREOFTENEVALUATEDWITHSOFTINFORMATIONANDRELYONRELATIONSHIPSWITHCOMMUNITYBANKERSIFSMALLBANKLENDINGISIMPAIREDORTHERELATIONSHIPSEVERED,ITMAYBEPARTICULARLYDIFFICULTFORTHESESMALLBORROWERSTOOBTAINALTERNATIVEFINANCINGMOREOVER,MOSTCOMMUNITYBANKSARETY

9、PICALLYPRIVATELYOWNED,SOOWNER/MANAGERSHAVEINCENTIVESTOREDUCERISKANDMAINTAINEQUITY,HUMANCAPITAL,ANDFRANCHISEVALUESTHISPAPEREXAMINESTHELINKBETWEENRISKADJUSTEDBANKPERFORMANCE,DIVERSIFICATION,ANDBUSINESSLINEEXPOSUREFORCOMMUNITYBANKSFROM1984TO2000BYFOCUSSINGONTHESESMALLBANKS,ONECANOBTAINABETTERUNDERSTAND

10、INGOFTHETRADEOFFSTHEYFACE,THEPOTENTIALOPPORTUNITIESTOIMPROVEPERFORMANCE,ANDTHEIRCOMPETITIVEPOSITIONVISAVISLARGERBANKSIFTHEOPERATIONSANDSTRATEGIESOFTHESEBANKSOFFERAFUNDAMENTALLYDIFFERENTMIXOFRISKANDRETURN,FOREXAMPLE,THENTHISLEAVESAPOTENTIALNICHEFORSMALLBANKSTODIFFERENTIATETHEMSELVESFROMTHEIRLARGERCOM

11、PETITORSTHISIS,TOMYKNOWLEDGE,THEFIRSTSTUDYOFREVENUEDIVERSIFICATIONFORCOMMUNITYBANKSIEXAMINESEVERALDISTINCTTYPESOFDIVERSIFICATIONFIRST,COMMUNITYBANKSCANBROADLYDIVERSIFYBYSHIFTINGBETWEENINTERESTGENERATINGACTIVITIESANDACTIVITIESTHATGENERATEFEES,FIDUCIARYOPERATIONS,TRADINGREVENUE,ANDOTHERNONINTERESTINCO

12、MEWHILESOMEOFTHESEACTIVITIESARELINKED,EG,LENDINGANDLOANCOMMITMENTFEES,NONINTERESTINCOMEHASBEENGROWINGMUCHMORERAPIDLYTHANNETINTERESTINCOMEANDPARTIALLYREECTSCHANGESINBANKSSTRATEGICFOCUSLIKEOPENINGNEWBUSINESSLINESANDOFFERINGNEWPRODUCTSIFRETURNSTOTHESEBROADACTIVITIESARENEGATIVELYORONLYWEAKLYCORRELATED,O

13、NEWOULDEXPECTANIMPROVEMENTINTERMSOFRISKANDRETURNSECOND,BANKSCANDIVERSIFYWITHINEACHOFTHESEBROADSETSOFACTIVITIES,FOREXAMPLE,ABANKTHATMAKESPRIMARILYREALESTATELOANSCOULDDIVERSIFYBYENTERINGTHECONSUMERLOANMARKETORABANKTHATISCONCENTRATEDINFIDUCIARYACTIVITIESCOULDBEGINTRADINGBOTHTYPESOFEXPANSIONCOULD,INPRIN

14、CIPLE,IMPROVETHERISK/RETURNPERFORMANCEOFACOMMUNITYBANKTOFOCUSONRISK,IMOVEBEYONDFAMILIARACCOUNTINGMEASUREOFBANKPROFITSLIKERETURNONASSETSROAORRETURNONEQUITYROEANDEXAMINESEVERALMEASURESOFRISKADJUSTEDPERFORMANCEINPARTICULAR,ICOMPAREINDICATORSOFDIVERSIFICATIONTORISKADJUSTEDRATESOFRETURNAVERAGEPROFITRATIO

15、DIVIDEDBYTHESTANDARDDEVIATIONOFTHERATIOANDTHEZSCORENUMBEROFSTANDARDDEVIATIONSTHATPROFITSMUSTFALLTOPUSHABANKINTOINSOLVENCYFORTHESECOMMUNITYBANKSTHATDONOTHAVEPUBLICLYTRADEDSECURITIES,THESEARETHEBESTMEASUREOFRISKADJUSTEDRETURNSANDTHEZSCOREPROVIDESDIRECTINFORMATIONABOUTINSOLVENCYRISKTHATISRELEVANTTOBOTH

16、BANKMANAGERSANDREGULATORSTHEEMPIRICALRESULTSSHOWLITTLEEVIDENCEOFDIVERSIFICATIONBENEFITSBETWEENBROADACTIVITYCLASSES,BUTDIVERSIFICATIONBENEFITSWITHINLENDINGANDNONINTERESTACTIVITIESCOMMUNITYBANKSWITHMORECONCENTRATEDLOANPORTFOLIOS,FOREXAMPLE,HAVELOWERRISKADJUSTEDPROFITSANDZSCORESTHISSUGGESTSTHATCOMMUNIT

17、YBANKSDOBETTERWHENTHEYSTAYFOCUSSEDONMAJORACTIVITIES,BUTGAINBYDIVERSIFYINGWITHINTHATAREAOFEXPERTISETHEDATAALSOPOINTTOAROBUSTSIZEEFFECTWHEREINCREASEDASSETSIZEISASSOCIATEDWITHHIGHERRETURNSANDLOWERRETURNVOLATILITY,WHICHCOULDREECTTHEBENEFITSOFSCALEORGEOGRAPHICDIVERSIFICATIONTHEREAREALSOSYSTEMATICDIFFEREN

18、CESACROSSBUSINESSLINES,SOMANAGERSMUSTREMAINCOGNIZANTOFTHERISKSASSOCIATEDWITHSPECIFICACTIVITIESMOSTNOTABLY,NONINTERESTINCOMEISNEGATIVELYASSOCIATEDWITHRISKADJUSTEDPERFORMANCE,ASARECOMMERCIALANDINDUSTRIALLENDING,OTHERLENDING,FEEBASEDACTIVITIES,ANDTRADINGTHISISAPOTENTIALDARKSIDEOFTHESEARCHFORDIVERSIFICA

19、TIONBENEFITSBANKSMAYMOVEBEYONDAREASOFCOMPARATIVEADVANTAGEANDENTERBUSINESSESWHERETHEYLACKTHEEXPERTISE,TECHNOLOGY,ORSCALENEEDEDTOCOMPETESUCCESSFULLYINADDITION,DEYOUNGANDROLAND2001ARGUETHATFUNDAMENTALDIFFERENCESBETWEENINTERESTANDNONINTERESTACTIVITIES,FOREXAMPLE,THENATUREOFCUSTOMERRELATIONSHIPS,INPUTMIX

20、ES,ANDCAPITALREQUIREMENTS,MAKEFEEBASEDACTIVITIESINHERENTLYMOREVOLATILETHUS,COMMUNITYBANKSMUSTCAREFULLYWEIGHTHETRADEOFFSBETWEENAMOREDIVERSIFIEDSETOFACTIVITIESANDEXPANSIONINTOVOLATILEBUSINESSLINESTHATHAVEBEENHISTORICALLYASSOCIATEDWITHWORSEOUTCOMESAFINALSETOFRESULTSSHOWSSIGNIFICANTDIFFERENCESINTHEDETER

21、MINANTSOFRISKADJUSTEDPERFORMANCEBETWEENCOMMUNITYANDOTHERBANKSTHISCOULDREECTFUNDAMENTALLYDIFFERENTTECHNOLOGY,OPERATIONS,ANDBUSINESSPRACTICESORDIFFERENTLENDINGMARKETSANDCUSTOMERS,ANDMAYPROVIDEACOMPARATIVEADVANTAGEFORCOMMUNITYBANKSINCERTAINMARKETSEGMENTSIFSO,THISCREATESANOPPORTUNITYFORCOMMUNITYBANKSTOS

22、ERVEVIABLEBANKINGMARKETSTHATARELESSATTRACTIVETOTHEIRLARGERCOMPETITORSANDISONEREASONFOROPTIMISMABOUTTHEFUTUREOFCOMMUNITYBANKSTHEIMPORTANCEOFCOMMUNITYBANKSTHEQUESTIONOFDIVERSIFICATIONBENEFITSFORCOMMUNITYBANKSISATTHEINTERSECTIONOFTWOEMPIRICALLITERATURESDTHEROLEOFSMALLBANKSINSMALLBUSINESSLENDINGANDTHEPO

23、TENTIALFORDIVERSIFICATIONBENEFITSINBANKINGTHISSECTIONBRIEYREVIEWSTHESETWORESEARCHLINESTOPROVIDETHECONTEXTFORTHEQUESTIONSADDRESSEDINTHISPAPERDEBATEABOUTTHEIMPORTANCEOFSMALL,COMMUNITYBANKSCENTERSONTHEQUESTIONOFWHETHERTHEYPROVIDEBANKINGSERVICESLIKESMALLBUSINESSLENDINGTHATARENOTPROVIDEDBYTHEIRLARGERCOMP

24、ETITORSBERGERETAL1998,DEYOUNGETAL1999,ANDBERGERANDUDELLFORTHCOMINGALLDISCUSSWHYSMALLBANKSMAYFOCUSONSMALLBUSINESSLENDINGPOTENTIALEXPLANATIONSINCLUDEINFORMATIONALCOSTADVANTAGESFORSMALLBANKSINLENDINGTOSMALL,INFORMATIONALLYOPAQUEFIRMSABILITYTOPROCESSSOFTINFORMATIONTHENEEDFORLONGRUNFINANCIALRELATIONSHIPS

25、ORGANIZATIONALDISECONOMIESOFSCALETHATRAISETHECOSTOFSMALLBUSINESSLENDINGATLARGERBANKSREDUCEDAGENCYCOSTSFORLESSCOMPLICATEDORGANIZATIONSLOCALMARKETEXPERTISECONSUMERPREFERENCESFORLOCALBANKSETCIFTHISISTHECASEANDSOMESMALLFIRMSAREBANKDEPENDENT,THENTHISCREATESANIMPORTANTROLEOFSMALLBANKSINOURFINANCIALSYSTEMT

26、HEEMPIRICALEVIDENCE,HOWEVER,ISMIXEDNAKAMURA1993,KEETON1995,BERGERANDUDELL1996,PEEKANDROSENGREN1996,STRAHANANDWESTON1998,DEYOUNGETAL1999REPORTTHATTHESHAREOFASSETSINSMALLBUSINESSLENDINGDECLINESWITHBANKSIZEBERGERETAL1998LOOKATTHEIMPACTOFMERGERSONSMALLBUSINESSLENDINGANDREPORTTHATCONSOLIDATIONITSELFREDUC

27、ESSMALLBUSINESSLENDING,WHILEPILLOFFANDRHOADES2000CONCLUDETHATLARGEDIVERSIFIEDBANKSDONOTHAVENETCOMPETITIVEADVANTAGESOVERTHEIRSMALLRIVALSFINALLY,BERGERETAL2003FINDFUNDAMENTALLYDIFFERENTLENDINGTECHNOLOGIESFORSMALLANDLARGEBANKSALLOFTHISSUGGESTSASPECIALROLEFORSMALLBANKSSTRAHANANDWESTON1998,HOWEVER,ALSORE

28、PORTTHATTHELEVELOFSMALLBUSINESSLOANSRISESMONOTONICALLYWITHBANKSIZEBERGERETAL1998ALSOFINDTHATMUCHOFTHEDECLINEINPOSTMERGERSMALLBUSINESSLENDINGISOFFSETBYINCREASESBYOTHERLOCALBANKS,ANDBERGERETAL2001SHOWTHATTHESEEXTERNALEFFECTSVARYACROSSBANKSIZEBERGERETAL2001SHOWTHATTHEPROBABILITYTHATASMALLFIRMBORROWSFRO

29、MASMALLBANKISPROPORTIONALTOTHEMARKETOFBANKSOFTHATSIZE,WHILEPEEKANDROSENGREN1998AREMIXEDONTHEIMPACTOFMERGERSONSMALLBUSINESSLENDING,DEPENDINGONTHEACQUIRERSLOANPORTFOLIOFINALLY,JAYARATNEANDWOLKEN1999REPORTNOEVIDENCEOFASMALLBANKCOSTADVANTAGETHATWOULDSUGGESTIMPORTANTCONSTRAINTSONSMALLBUSINESSESFROMTHEABS

30、ENCEOFSMALLBANKSTHISEVIDENCESUGGESTSTHATTHEDYNAMICSOFSMALLBUSINESSLENDINGAREQUITECOMPLEXANDITISNOTENOUGHTOSIMPLYLOOKATSMALLBANKLOANSHARESORTHERELATIVEIMPORTANCEOFSMALLBANKSINAGIVENMARKETTHEONGOINGDEREGULATIONTRENDHASCONTRIBUTEDTOASTEADYEXPANSIONOFBANKPOWERANDACTIVITIESWHILEONEMIGHTEXPECTTHISTOPROVID

31、EAMEANSTODIVERSIFYBANKOPERATIONS,INCREASEREVENUE,ANDREDUCERISK,THISNEEDNOTBETHECASEMORGANANDSAMOLYK2003SHOWTHATANEXPANSIONOFACTIVITIESCANLEADTOEITHERINCREASESORDECREASESINRISK,DEPENDINGONPREFERENCESEMPIRICALLY,SAUNDERSANDWALTER1994REVIEW18STUDIESTHATEXAMINEWHETHERNONBANKACTIVITIESREDUCEBANKHOLDINGCO

32、MPANYRISK,ANDCONCLUDETHATNINEANSWERYES,SIXANSWERNO,ANDTHREEPROVIDEMIXEDRESULTSTHISLITERATUREONBANKDIVERSIFICATIONHASAPPROACHEDTHEQUESTIONSFROMSEVERALDIRECTIONSSEVERALPAPERSPERFORMCOUNTERFACTUALEXERCISESOFBANKCOMBINATIONSWITHNONBANKSBOYDANDGRAHAM,1988BOYDETAL,1993ROSE,1989SAUNDERSANDWALTER,1994LOWNET

33、AL,2000THESEPAPERSTYPICALLYFINDSOMEPOTENTIALDIVERSIFICATIONBENEFITS,PARTICULARLYBETWEENCOMMERCIALBANKSANDLIFEINSURANCECOMPANIESMORERECENTLY,EMMONSETAL2003EXAMINEGEOGRAPHICRISKOFCOMMUNITYBANKSANDCONCLUDETHATTHEMAJORGAINSLOWERDEFAULTPROBABILITIESAREPOSSIBLETHROUGHINCREASESINBANKSIZE,RATHERTHANINCREASE

34、DSPREADOFTHEBANKTHISSUGGESTSTHATCOMMUNITYBANKSCANACHIEVEDIVERSIFICATIONGAINSTHROUGHGROWTH,WITHOUTGEOGRAPHICEXPANSIONASECONDSETOFPAPERSEXAMINESTHEACCOUNTINGRESULTSOFBANKSINVOLVEDINAWIDERANGEOFACTIVITIESROSENETAL,1989TEMPLETONANDSEVERIENS,1992KWAST,1989DEYOUNGANDROLAND,2001ACHARYAETAL,2002STIROH,FORTH

35、COMINGHERE,THERESULTSAREMOSTLYNEGATIVEWITHONLYTEMPLETONANDSEVERIENS1992FINDINGSTRONGEVIDENCEOFREDUCEDRISKASBANKSEXPANDTHEIRACTIVITIESBOTHDEYOUNGANDROLAND2001ANDSTIROHFORTHCOMINGFINDTHATINCREASEDRELIANCEONNONINTERESTACTIVITIESLIKEFEEINCOMEANDTRADINGINCREASESTHEVOLATILITYOFBANKEARNINGSDEYOUNGANDROLAND

36、2001POINTTOTHREEFACTORSTHATMAKENONINTERESTINCOMEMOREVOLATILETHANINTERESTINCOMELOWSWITCHINGCOSTSFORNONINTERESTACTIVITIES,HIGHOPERATINGLEVERAGETHATAMPLIFIESREVENUEVOLATILITYINTOHIGHERPROFITVOLATILITY,ANDHIGHERFINANCIALLEVERAGEDUETODIFFERENCESINREGULATORYCAPITALREQUIREMENTSATHIRDAPPROACHUSESMARKETDATAT

37、OEVALUATEPOTENTIALDIVERSIFICATIONBENEFITSSANTOMEROANDCHUNG,1992SAUNDERSANDWALTER,1994DEMSETZANDSTRAHAN,1997DELONG,2001THEEVIDENCEHEREISALSOMIXEDWITHSANTOMEROANDCHUNG1992ANDSAUNDERSANDWALTER1994FINDINGRISKREDUCTIONINTHEFORMOFLESSVOLATILEMARKETRETURNS,WHILEDELONG2001FINDSLITTLEVALUECREATIONFROMDIVERSI

38、FYINGMERGERSDEMSETZANDSTRAHAN1997REACHAMORESUBTLECONCLUSIONLARGEBANKHOLDINGCOMPANIESAREMOREDIVERSIFIEDTHANSMALLONES,BUTNOTNECESSARILYSAFERBECAUSETHEYPURSUERISKIERLENDINGLINESANDOPERATEWITHINCREASEDLEVERAGESIMILARLY,CEBENOYANANDSTRAHANFORTHCOMINGFINDTHATACTIVECREDITRISKMANAGEMENTINTHEFORMOFBUYINGANDS

39、ELLINGLOANSALLOWSBANKSTOHOLDLESSCAPITALANDMAKEMORERISKYLOANSTHISPAPERASKSWHETHERDIVERSIFICATIONVIANEWOPERATIONSANDBUSINESSLINESHELPSCOMMUNITYBANKSWHILEMANYSTUDIESHAVEEXAMINEDTHEPERFORMANCEOFSMALLBANKSSHAFFER,1989NAKAMURA,1993ZIMMERMAN,1996A,BBASSETANDBRADY,2001MEYERANDYEAGER,2001,NONETOMYKNOWLEDGEHA

40、VEDIRECTLYEXAMINEDTHEPOTENTIALFORREVENUEDIVERSIFICATIONBENEFITSFORCOMMUNITYBANKSIFONEBELIEVESTHATTHESEBANKSPLAYANIMPORTANTROLEINTHEECONOMY,THENTHISISARELEVANTQUESTIONBECAUSEITHELPSTOIDENTIFYTHESTRATEGIESTHATMAKEACOMMUNITYBANKSUCCESSFULDATAANDSUMMARYSTATISTICSTHISANALYSISREQUIRESDATAONDIVERSIFICATION

41、ANDRISKADJUSTEDPERFORMANCEFORINDIVIDUALSMALL,COMMUNITYBANKSTOCONSTRUCTTHESEMEASURES,IUSEDATAFROMTHECONSOLIDATEDREPORTOFCONDITIONANDINCOMECALLREPORTSFOR19842000ALLDATAAREDEFLATEDWITHTHEGDPDEATORTHESETOFSMALLCOMMUNITYBANKSISDEFINEDASALLBANKSWITHASSETSLESSTHAN300MILLIONIN1996DOLLARSANDWITHNOAFFILIATION

42、TOANOTHERBANKTHROUGHAMULTIBANKHOLDINGCOMPANYTHESETOFOTHERBANKSISDEFINEDASALLREMAININGBANKSTHESEAREEITHERLARGEBANKSORSMALLBANKSTHATBELONGTOMULTIBANKTABLE1SUMMARYSTATISTICSFORCOMMUNITYANDOTHERBANKS,19842000COMMUNITYBANKSHAVEASSETSLESSTHAN300MILLIONIN1996DOLLARSANDARENOTPARTOFAMULTIBANKORGANIZATIONINTH

43、ATYEAROTHERBANKSINCLUDEALLOTHERCOMMERCIALBANKSALLDOLLARFIGURESARESUMSFORTHETWOGROUPSANDREPORTEDIN1996DOLLARSINCOMESHARESAREASAPERCENTAGEOFNETOPERATINGREVENUENETINTERESTINCOMEPLUSNONINTERESTINCOMELOANSSHARESAREASAPERCENTAGEOFTOTALLOANSORGANIZATIONSWHENAMERGERORACQUISITIONOCCURS,THEACQUIRINGBANKSCODEI

44、SMAINTAINEDANDTHETARGETDROPSFROMTHESAMPLETHEEFFECTOFMERGERSONTHEBANKLEVELRESULTSISADDRESSEDBELOWTABLE1REPORTSTHEBREAKDOWNOFTHEUNITEDSTATESBANKINGINDUSTRYBETWEENTHISDEFINITIONOFCOMMUNITYBANKSANDOTHERBANKSFOR1984,1992,AND2000,WHEREALLDOLLARFIGURESARESUMSOVERALLBANKSINEACHGROUPCOMMUNITYBANKSACCOUNTASUB

45、STANTIALNUMBEROFTHEINSTITUTIONS66IN2000,BUTAMUCHSMALLERFRACTIONOFINDUSTRYASSETS76IN2000THISTABLEALSOSHOWSTHESUMOFNETINCOME,NETOPERATINGREVENUENETINTERESTINCOMEPLUSNONINTERESTINCOME,ANDTOTALLOANSFOREACHGROUP,ASWELLASTHEBREAKDOWNOFNONINTERESTINCOMEANDTHELOANPORTFOLIOINTOCOMPONENTSHARESNETINTERESTINCOM

46、EANDNONINTERESTINCOMEAREPARTICULARLYIMPORTANTBECAUSETHEYCOMPRISEBANKREVENUEANDPROVIDEUSEFULPROXIESOFACTIVITYFOCUSNETINTERESTINCOMEISEARNEDLARGELYFROMLENDINGACTIVITIES,WHILENONINTERESTINCOMEISGENERATEDFROMAHOSTOFDIFFERENTACTIVITIESINCLUDINGFIDUCIARYBUSINESS,TRADING,SERVICECHARGES,ANDOTHERFEEGENERATIN

47、GACTIVITIESSOMEOFTHESENONINTERESTACTIVITIESAREVERYTRADITIONALSOURCESOFREVENUE,FOREXAMPLE,ATMFEES,SAFETYDEPOSITBOXFEES,ANDSERVICECHARGES,WHILEOTHERSAREMUCHLESSTRADITIONAL,EG,SECURITIZATION,TRADINGREVENUE,ORMUTUALFUNDFEESFIGURE1SHOWSTHEGROWINGIMPORTANCEOFNONINTERESTINCOMEFORCOMMUNITYANDOTHERBANKSBYPLO

48、TTINGTHENONINTERESTINCOMESHARENONINTERESTINCOMEDIVIDEDBYNETOPERATINGREVENUEBOTHSETSOFBANKSHAVECLEARLYSHIFTEDTOWARDNONINTERESTACTIVITIES,ALTHOUGHTHESHAREISLOWERFORCOMMUNITYBANKSFROM1984TO2000,OTHERCOMMERCIALBANKSSAWNONINTERESTINCOMEASASHAREOFNETOPERATINGREVENUERISEFROM269TO449ANINCREASEOF67,WHILECOMM

49、UNITYBANKSSAWANINCREASEFROM149TO215ANINCREASEOF44THEKEYPOINTISTHATBANKSOFALLSIZESARESHIFTINGTOWARDNONINTERESTINCOME,WHICHSTIROHFORTHCOMINGSHOWSISMUCHMOREVOLATILETHANNETINTERESTINCOMEWHILETHISBREAKDOWNINTONETINTERESTANDNONINTERESTACTIVITIESISAUSEFULINDICATOROFFOCUS,ITISSOMEWHATARTIFICIALSOMETYPESOFNONINTERESTINCOMEARECLOSELYLINKEDTOTHEACTIVITIESTHATGENERATENETINTERESTINCOME,EG,SERVICECHARGESANDATMFEES,SOITISHARDTOMAKEACLEARDISTINCTIONBETWEENACTIVITIESINADDITION,NETINTERESTINCOMEISNOTONLYANINDICATOROFLENDINGACTIVITY,BUTALSOREECTSINCOMEEARNEDONOTHERLIQUIDASSETSLIKEGOVERNMEN