Notes on Valuation of Financial Companies

DuPont scheme

NI: Net Income

PBT: Profit Before Tax

OI: Operating Income

TI: Total Income

NII: Net Interest Income

TA: Total Asset

NI/PBT: highlights the impact of tax expenses on the net result. There is a limited possibility for the bank to
control such a ratio.

PBT/OI: highlights the impact of extraordinary items on PBT.

OI/TI: the level of this ratio is mainly driven by the impact of impairment charges on the loan portfolio and
operating expenses. It is important to analyze the two components separately (through asset quality ratios
and cost income).

TI/NII: influenced by the level of specialization of the bank. It highlights the impact of commission and
trading income on total income.

NII/TA: approximation for the net interest margin (which is computed only on interest bearing assets and
liabilities).

TA/Shareholders Equity: Proxy for the level of financial leverage (does not include off-Balance Sheet
obligations).