Table 2 The widely used parameters... | Emerald Publishing

Table 2

The widely used parameters within CAMELS Model

CAMELS parameters	CALCULATION	literature (source)
Capital adequacy	Capital Adequacy Ratio (CAR) = BASEL Ratio $CAR (%) = \frac{Total regulatory capital}{Risk - weighted assets}$	(Altan et al., 2014; Wanke et al., 2016; Karim et al., 2018)
Assets quality	Asset Quality (AQ) = Gross nonperforming financing ratio $AQ (%) = \frac{Gross nonperforming financing}{Total financing}$	(Sahut and Mili, 2011; Altan et al., 2014; Lahrech et al., 2014; Alqahtani et al., 2017)
Management	Management (MAN) = Cost to Income $MAN (%) = \frac{Operating costs}{Gross income}$	(Dincer et al., 2011; Peltonen et al., 2015; Alqahtani et al., 2017; Munir et al., 2017)
Earnings	Return on assets (ROA) $ROA (%) = \frac{Net income}{Total assets}$	(Dincer et al., 2011; Wanke et al., 2016; Alqahtani et al., 2017; Karim et al., 2018)
	Return on equity (ROE) $ROE (%) = \frac{Net income}{Equity}$	( Dincer et al., 2011; Altan et al., 2014; Lahrech et al., 2014; Peltonen et al., 2015; Munir et al., 2017; Karim et al., 2018)
	Net profit margin (NPM) $NPM (%) = \frac{Net income}{Gross income}$	(Altan et al., 2014; Wanke et al., 2016; Karim et al., 2018)
Liquidity	Liquidity assets ratio (LIQ) $LIQ (%) = \frac{Liquid assets}{Total assets}$	(Dincer et al., 2011; Altan et al., 2014; Lahrech et al., 2014; Peltonen et al., 2015; Alqahtani et al., 2017; Karim et al., 2018)
Sensitivity to market risk	Sensitivity to market risks (SEN) = Net foreign exchange (FX) open position to capital $SEN (%) = \frac{Net foreign exchange (FX) open position}{Total regulatory capital}$	(Gasbarro et al., 2002; Dincer et al., 2011; Roman and Şargu, 2013; Erol et al., 2014; Hofstetter et al., 2018; Karim et al., 2018)

CAMELS parameters	CALCULATION	literature (source)
Capital adequacy	Capital Adequacy Ratio (CAR) = BASEL Ratio $CAR (%) = \frac{Total regulatory capital}{Risk - weighted assets}$	(Altan et al., 2014; Wanke et al., 2016; Karim et al., 2018)
Assets quality	Asset Quality (AQ) = Gross nonperforming financing ratio $AQ (%) = \frac{Gross nonperforming financing}{Total financing}$	(Sahut and Mili, 2011; Altan et al., 2014; Lahrech et al., 2014; Alqahtani et al., 2017)
Management	Management (MAN) = Cost to Income $MAN (%) = \frac{Operating costs}{Gross income}$	(Dincer et al., 2011; Peltonen et al., 2015; Alqahtani et al., 2017; Munir et al., 2017)
Earnings	Return on assets (ROA) $ROA (%) = \frac{Net income}{Total assets}$	(Dincer et al., 2011; Wanke et al., 2016; Alqahtani et al., 2017; Karim et al., 2018)
	Return on equity (ROE) $ROE (%) = \frac{Net income}{Equity}$	( Dincer et al., 2011; Altan et al., 2014; Lahrech et al., 2014; Peltonen et al., 2015; Munir et al., 2017; Karim et al., 2018)
	Net profit margin (NPM) $NPM (%) = \frac{Net income}{Gross income}$	(Altan et al., 2014; Wanke et al., 2016; Karim et al., 2018)
Liquidity	Liquidity assets ratio (LIQ) $LIQ (%) = \frac{Liquid assets}{Total assets}$	(Dincer et al., 2011; Altan et al., 2014; Lahrech et al., 2014; Peltonen et al., 2015; Alqahtani et al., 2017; Karim et al., 2018)
Sensitivity to market risk	Sensitivity to market risks (SEN) = Net foreign exchange (FX) open position to capital $SEN (%) = \frac{Net foreign exchange (FX) open position}{Total regulatory capital}$	(Gasbarro et al., 2002; Dincer et al., 2011; Roman and Şargu, 2013; Erol et al., 2014; Hofstetter et al., 2018; Karim et al., 2018)

Source(s): Retrieved from the literature