Valuation of an Untraded Bank Stock

Loading...
Thumbnail Image
Authors
Whitson, Thomas D.
Issue Date
1974-04-18
Type
Thesis
Language
en_US
Keywords
Research Projects
Organizational Units
Journal Issue
Alternative Title
Abstract
In the past decade much legislation has been passed which permits branch banking or bank holding companies. With the advent of this legislation the purchase and sale of banks has become quite common. Most banks, especially the smaller ones, do not have an active market in their stock where the law of supply and demand can set a price. | Since there is no market place where a price is set, the problem arises of establishing a value. | This paper will examine the various aspects of banking which are factors in the valuation of banks. These factors, in turn, will be applied to the determination of the value per share of the Council Bluffs Savings Bank. Comparative data from other banks will be provided. | The factors, which determine the value of a bank, to be examined are capitalization, earnings, deposits, investments, and community growth. | Three different methods for determining the value of a bank are described, analyzed, and applied to a specific set of facts. The methods are: comparable sales, value analysis from financial statements, and a present-value analysis. Each of these methods provides a different approach to finding a value. | The comparable sales method will use the sales price of four banks which have recently been sold in the state of Iowa. All of the banks to be compared are similar to the Council Bluffs Savings Bank. | The value analysis from the financial statements will compare the financial statements of the Council Bluffs Savings Bank to all banks in the state of Iowa and banks of comparable size in the state of Iowa. An analysis of the income and expenses will also be made.
Description
Citation
Publisher
Creighton University
License
A non-exclusive distribution right is granted to Creighton University and to ProQuest following the publishing model selected above.
Journal
Volume
Issue
PubMed ID
DOI
ISSN
EISSN