Analysis of Singapore Banks and Finance Firms
As a fundamental investor, I always look at financials statement to analysis if a company is good enough to invest in. However, there is always 2 types of balance sheet we need to take note – The regular one and the Financial Institutions (FI) one. Normal Balance Sheet FI Balance Sheet In the past, if I want to invest in a FI, I used to tell myself – I don’t know how to analyze their financials, let’s skip them! But as days, weeks, years went past, and you realise that there are numerous financial firms in of Berkshire Hathaway picks , that’s probably an indication for me to start to learn how to analyze a FI financials. After jotting down a list of criteria and factors, I reduce it to these 4 criteria. 1. Return on Assets (ROA) Formula: (Net Profit - One-time Gain) / Total Assets x 100% In my opinion, Return of Assets is the most powerful ratio of them all to calculate the performance of a FI. I believe it is mention by Warren Buffet before (lost track of th...