RISK ANALYSIS OF BANKS IN ECUADOR THROUGH THE CAMELS METHODOLOGY

Authors

  • Andrea Calahorrano Universidad Técnica de Cotopaxi
  • Nathaly Guadalupe Sancan Universidad Técnica de Cotopaxi
  • Efrén Montenegro Universidad Técnica de Cotopaxi

DOI:

https://doi.org/10.37135/kai.03.10.06

Keywords:

Financial risk, financial institutions, CAMELS, risk rating

Abstract

This investigation tried to develop a risk analysis through the application of the CAMELS method in the five largest banks in Ecuador, selected under the criteria of assets, liabilities, equity, liquidity funds and financial profits, allowing a monitoring of the entities of control and institutions to make timely decisions and measures to avoid possible financial imbalances, reduce risk and uncertainty in the markets and thus strengthen public confidence. The approach used is quantitative, under a phenomenological and empirical methodology, where a database of the Superintendency of Banks of Ecuador was used, on the indicators: capital (C), asset quality (A), governance (M), profitability (E), liquidity (L) and market risk (S), managing to establish a good positioning of the financial entities under study. The best positioned institutions were Pichincha, Internacional and Bolivarian, which showed a high rating, being Optimum (A) and Above Expected (B); in comparison to Banco del Pacífico and Guayaquil, which showed a rating within what was expected (C) and below what was expected (D).

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References

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Sahlu Desta, T. (2016). Financial Performance of "The best African Banks": A compartive analysis through CAMEL rating. Journal of Accounting and Management, 6(1), 1–20.

Superintendencia de Bancos (2021). Balance General. Quito, Ecuador

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Published

2023-01-16

Issue

Vol. 6 No. 10 (2023): Kairós, Revista de Ciencias Económicas, Jurídicas y Administrativas

Section

Articles

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How to Cite

RISK ANALYSIS OF BANKS IN ECUADOR THROUGH THE CAMELS METHODOLOGY. (2023). Kairos: Journal of Economy, Law and Administrative Sciences, 6(10), 116-128. https://doi.org/10.37135/kai.03.10.06