Glossary
Banking Metrics Glossary
Definitions, formulas, supervisory thresholds, and worked examples for 120 of the financial metrics that analysts and bank board members use to evaluate US banks. Every metric is sourced from FFIEC call report schedules and the relevant federal regulatory guidance.
Capital
23 metrics
Common Equity Tier 1 Capital Ratio
The CET1 ratio measures a bank's highest-quality capital — common equity, retained earnings, and qualifying disclosed reserves — against its risk-weighted assets. …
Tier 1 Risk-Based Capital Ratio
The Tier 1 Risk-Based Capital ratio measures a bank's Tier 1 capital — CET1 plus Additional Tier 1 instruments — against its …
Total Risk-Based Capital Ratio
The Total Risk-Based Capital ratio measures a bank's total qualifying capital — Tier 1 plus Tier 2 instruments — against its risk-weighted …
Tier 1 Leverage Ratio
The Tier 1 Leverage Ratio measures Tier 1 capital against average total assets — unlike the risk-based capital ratios, it does not …
Tangible Common Equity / Tangible Assets
TCE/TA measures common shareholders' equity excluding goodwill and intangibles, divided by total assets excluding the same. It is the purest measure of …
Equity to Assets Ratio
The equity-to-assets ratio measures total shareholders' equity against total assets. It is the simplest possible capital measure: how much of every asset …
AOCI Burden
AOCI Burden measures unrealized losses on available-for-sale and held-to-maturity securities relative to a bank's tangible common equity. It quantifies the gap between …
Total Equity Capital
Total equity capital is the bank's net worth on a book basis — common stock, surplus, retained earnings, and accumulated other comprehensive …
Goodwill
Goodwill is the premium a bank paid over the fair value of net assets in an acquisition. It is an intangible asset …
Intangible Assets
Intangible assets are non-physical assets other than goodwill — core deposit intangibles, customer relationships, and certain servicing rights. Most are deducted from …
Tier 1 Capital
Tier 1 capital is a bank's core, going-concern capital — common equity tier 1 plus additional tier 1 instruments. It is the …
Common Equity Tier 1 Capital
Common equity tier 1 (CET1) capital is the highest-quality, most loss-absorbing capital a bank holds — common stock, retained earnings, and qualifying …
Risk-Weighted Assets
Risk-weighted assets (RWA) are a bank's assets and off-balance-sheet exposures scaled by their credit risk. RWA is the denominator of every risk-based …
Tangible Common Equity
Tangible common equity (TCE) is total common equity less goodwill and other intangibles — the capital that would actually remain to absorb …
Net Worth Ratio (Credit Unions)
The net worth ratio is the credit-union analog of a bank's leverage ratio — net worth divided by total assets. It is …
Community Bank Leverage Ratio
The Community Bank Leverage Ratio (CBLR) is a simplified capital framework available to US community banks under $10B in assets. Banks that …
Supplementary Leverage Ratio
The Supplementary Leverage Ratio (SLR) measures Tier 1 capital against total leverage exposure, including off-balance-sheet items. It applies only to the largest …
Capital Conservation Buffer
The Capital Conservation Buffer (CCB) is a 2.5% layer of CET1 capital that sits on top of the Basel III minimums. Banks …
G-SIB Surcharge
The G-SIB Surcharge is an additional CET1 capital requirement applied to Global Systemically Important Banks (G-SIBs). The eight US G-SIBs face surcharges …
Stress Capital Buffer
The Stress Capital Buffer (SCB) is a bank-specific CET1 buffer derived from the Federal Reserve's annual stress test. It replaces the static …
Tier 2 Capital
Tier 2 capital is the second-quality layer of regulatory capital — primarily subordinated debt, qualifying allowance for credit losses, and certain long-dated …
Additional Tier 1 Capital
Additional Tier 1 (AT1) capital consists of perpetual non-cumulative preferred stock and certain hybrid instruments that absorb losses on a going-concern basis …
Countercyclical Capital Buffer
The Countercyclical Capital Buffer (CCyB) is a macroprudential CET1 add-on that regulators raise during credit booms and release during downturns. The US …
Asset Quality
24 metrics
Texas Ratio
The Texas Ratio compares a bank's potential credit losses (non-performing assets + real-estate-owned) to its loss-absorbing capacity (tangible common equity + loan …
Non-Performing Loans Ratio
The NPL ratio measures loans past due 90+ days or in non-accrual status as a percentage of total loans. It is the …
Non-Performing Assets Ratio
The NPA ratio extends NPL to include other real estate owned (OREO) — property the bank has foreclosed on — as a …
Net Charge-Off Ratio
The Net Charge-Off ratio (annualized) measures loans actually written off as uncollectible (less subsequent recoveries) divided by average loans outstanding. It is …
Allowance for Credit Losses / Loans
ACL/Loans measures the bank's reserve for expected credit losses as a percentage of total loans. Under the CECL (Current Expected Credit Loss) …
Loan Loss Coverage Ratio
The coverage ratio measures the bank's loan loss reserve against its non-performing loans. It answers: how many times over could the bank's …
Allowance for Credit Losses
The allowance for credit losses (ACL) is the reserve a bank holds on its balance sheet against expected loan losses. It is …
Commercial & Industrial Loans
Commercial and industrial (C&I) loans are credit extended to businesses for working capital, equipment, and operations — as opposed to real estate. …
Commercial Real Estate Loans
Commercial real estate (CRE) loans are credit secured by income-producing or owner-occupied commercial property — office, retail, multifamily, industrial. They are the …
Construction & Land Development Loans
Construction and land development (C&D) loans finance the building and preparation of real estate before it generates income. They are the highest-risk …
Nonaccrual Loans
Nonaccrual loans are loans on which the bank has stopped recognizing interest income because full repayment is in doubt — generally once …
Past-Due Loans
Past-due loans are loans behind on their contractual payments, reported in 30-89 day and 90+ day buckets. The early (30-89 day) bucket …
Net Charge-Offs
Net charge-offs (NCOs) are the loans a bank has written off as uncollectible, less amounts recovered on previously charged-off loans. They are …
Agricultural Loans
Agricultural loans finance farming operations and farmland — production loans for crops and livestock plus loans secured by farm real estate. They …
Consumer Loans
Consumer loans are credit extended to individuals for personal, household, and family purposes — credit cards, auto loans, and other personal loans. …
Loans Held for Sale
Loans held for sale are loans — usually newly originated residential mortgages — that a bank intends to sell rather than keep, …
Classified Assets
Classified assets are loans and other assets that bank examiners have rated Substandard, Doubtful, or Loss under the interagency credit classification framework. …
Special Mention Loans
Special Mention is the lowest rung of the criticized-loans framework — loans with potential weaknesses that deserve management's close attention but do …
Troubled Debt Restructuring
A Troubled Debt Restructuring (TDR) is a loan where the bank grants a concession (rate cut, term extension, principal forgiveness) to a …
Residential Real Estate Loans
Residential Real Estate Loans (1-4 family mortgages) are loans secured by owner-occupied or investor-owned residential property with 1-4 dwelling units. Roughly $2.5T …
Multifamily Real Estate Loans
Multifamily Loans are mortgages secured by residential properties with 5 or more dwelling units — apartment buildings, garden complexes, mid-rise rentals. Multifamily …
Credit Card Loans
Credit Card Loans are unsecured revolving consumer loans accessed via a card network (Visa, Mastercard, Amex, Discover). The asset class generates the …
Auto Loans
Auto Loans are consumer or business loans secured by vehicles. The product is split between captive lenders (Toyota Financial, Ford Credit), banks, …
Small Business Loans
Small Business Loans are commercial credit extensions to businesses, typically under $1M individually. The category is dominated by community banks and is …
Profitability
13 metrics
Return on Average Assets
Return on Average Assets measures net income against the bank's average total assets over the period. It is the single most-watched profitability …
Return on Average Equity
Return on Average Equity measures net income against the bank's average shareholders' equity. It is the most-watched profitability metric for equity investors …
Net Interest Margin
Net Interest Margin measures net interest income (interest earned minus interest paid) against average earning assets. It is the core spread the …
Yield on Earning Assets
Yield on Earning Assets measures gross interest income as a percentage of average earning assets. It is the asset-side input to net …
Cost of Funds
Cost of Funds measures the bank's total interest expense as a percentage of average interest-bearing liabilities. It is the liability-side input to …
Efficiency Ratio
The Efficiency Ratio measures non-interest operating expense against net revenue (net interest income + non-interest income). It answers: how many cents of …
Net Interest Spread
Net interest spread is the difference between the average yield a bank earns on its assets and the average rate it pays …
Pre-Provision Net Revenue
Pre-Provision Net Revenue (PPNR) is the bank's earnings before credit losses — net interest income plus noninterest income minus noninterest expense. It …
Fee Income Ratio
The Fee Income Ratio measures the share of a bank's total revenue that comes from noninterest sources — service charges, trust fees, …
Operating Leverage
Operating leverage in banking is the year-over-year change in revenue minus the year-over-year change in expenses. Positive operating leverage means revenues are …
Equity Multiplier
The Equity Multiplier (Assets / Equity) measures how many dollars of assets each dollar of book equity supports. It is the leverage …
Yield on Loans
Yield on loans is the annualized interest income a bank earns on its loan and lease portfolio, expressed as a percentage of …
Asset Growth Rate
The asset growth rate is the year-over-year percentage change in a bank's total assets. It captures how fast the balance sheet is …
Income & Expense
11 metrics
Net Income
Net income is a bank's bottom-line profit for the period — total revenue less interest expense, noninterest expense, the provision for credit …
Net Interest Income
Net interest income (NII) is the difference between the interest a bank earns on loans and securities and the interest it pays …
Provision for Credit Losses
The provision for credit losses is the expense a bank records to build or maintain its allowance for credit losses. Under the …
Total Interest Income
Total interest income is all the interest and fees a bank earns on its earning assets — loans, leases, and securities — …
Total Interest Expense
Total interest expense is everything a bank pays for its funding — interest on deposits and on borrowings. It is the cost …
Retained Earnings
Retained earnings are the cumulative profits a bank has kept rather than paid out as dividends. They are a core component of …
Noninterest Income
Noninterest income is revenue a bank earns outside of interest — service charges, interchange and card fees, wealth and fiduciary fees, mortgage …
Noninterest Expense
Noninterest expense — also called overhead — is what it costs to run the bank: salaries and benefits, occupancy and equipment, technology, …
Service Charges on Deposit Accounts
Service Charges on Deposit Accounts captures monthly maintenance fees, overdraft and NSF fees, ATM surcharges, and related deposit-related fees. Historically the largest …
Trading Revenue
Trading Revenue is the bank's income from market-making, proprietary trading, and changes in the fair value of trading-account positions. It is concentrated …
Salary and Employee Benefits Expense
Salary and Employee Benefits Expense is the largest single cost line for almost every bank — typically 45-60% of noninterest expense. It …
Securities & Investments
11 metrics
Held-to-Maturity Securities
Held-to-maturity (HTM) securities are bonds a bank intends and is able to hold until they mature. They are carried at amortized cost …
Available-for-Sale Securities
Available-for-sale (AFS) securities are bonds a bank may sell before maturity for liquidity or balance-sheet management. They are carried at fair value, …
HTM Unrealized Losses
HTM unrealized losses are the gap between the amortized-cost carrying value of a bank's held-to-maturity securities and their lower current market value. …
AFS Unrealized Losses
AFS unrealized losses are the mark-to-market losses on a bank's available-for-sale securities. Unlike HTM losses, they are recognized — they flow through …
Total Securities
Total securities is a bank's entire investment portfolio — held-to-maturity bonds at amortized cost plus available-for-sale bonds at fair value. It is …
Mortgage-Backed Securities
Mortgage-backed securities (MBS) are bonds backed by pools of home loans. Banks hold mostly agency MBS (guaranteed by Fannie Mae, Freddie Mac, …
U.S. Treasury Securities
U.S. Treasury securities held by a bank are direct obligations of the federal government — the highest-quality, most-liquid assets a bank can …
Trading Assets
Trading assets are securities and derivatives a bank holds for short-term resale or to serve client market-making, carried at fair value with …
Agency Mortgage-Backed Securities
Agency MBS are mortgage-backed securities guaranteed by Fannie Mae, Freddie Mac, or Ginnie Mae. They carry minimal credit risk (US government or …
Municipal Securities
Municipal Securities are debt issued by state and local governments and their agencies. Most pay interest exempt from federal income tax, making …
Securities Portfolio Yield
Securities Portfolio Yield measures the average interest income generated by the bank's investment securities portfolio as a percentage of average securities balances. …
Liquidity & Balance Sheet
29 metrics
Loan-to-Deposit Ratio
The Loan-to-Deposit Ratio measures the bank's loans outstanding as a percentage of its deposit base. It captures how aggressively the bank is …
Core Deposit Ratio
The Core Deposit Ratio measures 'core' deposits — generally non-time-deposits below the FDIC insurance limit — as a percentage of total deposits. …
Uninsured Deposit Ratio
The Uninsured Deposit Ratio measures deposits above the $250K FDIC insurance threshold as a percentage of total deposits. Made infamous by the …
Commercial Real Estate Concentration Ratio
The CRE Concentration Ratio measures commercial real estate loans (construction + non-owner-occupied CRE + multifamily) as a percentage of total risk-based capital. …
Construction Loan Concentration
The Construction Loan Concentration measures construction, land, and land development loans as a percentage of total risk-based capital. The 2006 interagency guidance …
Brokered Deposits Ratio
The Brokered Deposits Ratio measures deposits placed through deposit brokers as a percentage of total deposits. Heavy reliance on brokered deposits is …
Total Assets
Total assets is the sum of everything a bank owns — cash, securities, loans and leases, premises, and other assets — reported …
Total Deposits
Total deposits is the sum of all money customers have placed with a bank — checking, savings, money market, and time deposits …
Total Loans & Leases
Total loans and leases is the gross amount a bank has lent out — commercial, real estate, consumer, and agricultural credit — …
Noninterest-Bearing Deposits
Noninterest-bearing deposits — primarily demand deposit accounts (checking) — are balances on which a bank pays no interest. They are the cheapest, …
Time Deposits (CDs)
Time deposits are certificates of deposit (CDs) with a fixed maturity and rate. Smaller, retail CDs are reasonably stable; large 'jumbo' CDs …
Core Deposits
Core deposits are a bank's stable, relationship-based funding — checking, savings, and smaller time deposits — excluding rate-sensitive jumbo CDs and brokered …
Uninsured Deposits
Uninsured deposits are balances above the $250,000 FDIC insurance limit. Because depositors stand to lose money if the bank fails, uninsured deposits …
Savings Deposits
Savings deposits are interest-bearing accounts without a fixed maturity, including statement savings and money market deposit accounts. They are a core, relatively …
Money Market Deposit Accounts
Money market deposit accounts (MMDAs) are interest-bearing savings accounts that allow limited transactions and typically pay more than basic savings. They are …
Interest-Bearing Deposits
Interest-bearing deposits are all deposits on which a bank pays interest — savings, money market, NOW, and time accounts. They are the …
Total Borrowings
Total borrowings are a bank's wholesale, non-deposit funding — Federal Home Loan Bank advances, fed funds purchased, repurchase agreements, and subordinated debt. …
Liquidity Coverage Ratio
The Liquidity Coverage Ratio (LCR) measures whether a bank holds enough high-quality liquid assets to survive a 30-day stress scenario. It is …
Net Stable Funding Ratio
The Net Stable Funding Ratio (NSFR) measures whether a bank's long-term assets are matched by long-term funding sources. It is the structural …
FHLB Advances
Federal Home Loan Bank (FHLB) Advances are collateralized loans from one of the 11 regional FHLBs to member banks. FHLB advances are …
Federal Funds Purchased
Federal Funds Purchased is overnight unsecured borrowing in the interbank market. The fed funds rate that the FOMC targets is the rate …
Repurchase Agreements
A Repurchase Agreement (Repo) is a short-term collateralized loan structured as the sale of securities with an agreement to repurchase them at …
Reciprocal Deposits
Reciprocal Deposits are deposits placed at one bank but swapped through a network (IntraFi/ICS, ModernFi) into multiple receiving banks, each below the …
Cash and Due from Banks
Cash and Due from Banks is the bank's most liquid asset — currency in vault, deposits at the Federal Reserve, and balances …
Loans-to-Assets Ratio
The loans-to-assets ratio is total loans and leases as a percentage of total assets. It measures how much of a bank's balance …
Liquid Assets Ratio
The liquid assets ratio measures cash and readily marketable securities as a percentage of total assets — the on-balance-sheet cushion a bank …
Wholesale Funding Ratio
The wholesale funding ratio measures borrowed money and non-core, rate-sensitive deposits as a percentage of total funding — the share of a …
Deposit Growth Rate
The deposit growth rate is the year-over-year percentage change in a bank's total deposits — a direct read on whether its funding …
Deposits per Branch
Deposits per branch is total deposits divided by the number of physical branch offices — a simple gauge of branch-network productivity and …
Supervision & Ratings
9 metrics
CAMELS Rating
CAMELS is the supervisory rating system examiners use to grade a bank's safety and soundness across six components — Capital, Asset quality, …
Prompt Corrective Action
Prompt Corrective Action (PCA) is the framework that sorts banks into capital categories — from well capitalized to critically undercapitalized — and …
Enforcement Actions
Enforcement actions are formal and informal measures bank regulators take against an institution or its officers — consent orders, cease-and-desist orders, civil …
Bank Failures
A bank failure occurs when a regulator closes an insolvent or critically undercapitalized bank and appoints the FDIC as receiver. Failures cluster …
Consent Order
A Consent Order is a formal public enforcement action where a bank agrees to specified corrective actions without admitting or denying alleged …
Cease and Desist Order
A Cease and Desist Order is a formal supervisory action directing a bank to stop unsafe or unsound practices or violations of …
Memorandum of Understanding
A Memorandum of Understanding (MOU) is an informal, non-public supervisory agreement between a bank and its regulator. MOUs are an intermediate step …
Civil Money Penalty
A Civil Money Penalty (CMP) is a monetary fine imposed by a bank regulator for violations of law, regulation, or supervisory agreement. …
Dodd-Frank Wall Street Reform and Consumer Protection Act
The Dodd-Frank Act (Public Law 111-203, July 2010) is the comprehensive financial reform law passed in response to the 2008 financial crisis. …
Data sources: FFIEC call report schedules, FDIC institution directory, federal regulatory guidance. Definitions are editorial and updated as accounting standards or supervisory thresholds change. See /data-updates/ for the current data freshness window.
Have a metric we should add? Let us know.