Based On Factor Analysis Of Domestic Listed Banks Consolidated Financial Analysis And Evaluation

The author makes financial analysis of the listed banks regarding their profitability, solvency, operation ability, market value, and growth ability. The author also establishes model for the listed banks'financial evaluation system.The disadvantages for the traditional method which uses the weighted value to evaluate the financial status are that, the weights are subjective to the decision-makers'experience and it's difficult for the model to evaluate the relationship between the indices. The factor analysis method utilized in this paper solved the problems referred before by determining the weights on the basis of the first-hand data analysis, therefore guarantees the objectivity. Also, the method reduces the factors and makes them into integrated factors, therefore avoids the repeatedness of information.Former research relating to the performance of listed banks doesn't give much importance to the"market value"factor, while this article adds this factor to the model so the investors can estimate the financial performance of listed banks completely and systematically.This article selects 14 major financial indexes and conducts integrated financial analysis using factor analysis based on the financial reports of the eight listed banks in 2006. According to the overall grades which indicate the performance of the specific bank in 2006, a ranking list is made to estimate the financial status of each bank. Results of this research indicate that the factor analysis simplifies the factor structure and construct an efficient model to estimate the financial performance of the listed banks. The outcome of the model reflects the real financial level of the listed banks, so it is an effective method to analyze the financial reports of listed banks. The results of the model can be an important guideline for the investors.