Balance sheet mismatch: A balance sheet is a fiscal statement showing a company's assets, liabilities and capital on a specified date. A 'mismatch' in a balance sheet indicates that the maturities of the liabilities differ (are typically shorter) from those of the assets and/or that some liabilities are denominated in a foreign currency whilst the assets are not.
Banking soundness: The financial health of a single bank--measured by annual returns on total assets and equity--or of a country's banking system.
ROE: The return on equity, which equals total amount less preferred dividends divided by total common equity multiplied by 100.
ROA: The return on assets, which equals net income before preferred dividends plus interest expense on debt minus interest capitalised multiplied by i; minus the tax rate and divided by previous year's total assets multiplied by 100.
Asset liability management: Refers to the prudent management of assets to ensure that liabilities are sufficiently covered by productive assets at all times.
Assets under management: Funds managed by an investment company on behalf of investors.
Intermediation: The process of transferring funds from the ultimate source (savers) to the ultimate user (borrowers). A bank 'intermediates' credit when it obtains money from depositors and on-lends it to borrowers.
Collateral: Security pledged for the repayment of a loan.
Liquidity: The ability to convert an asset into cash quickly.
Basel II Accord: A comprehensive revision of the Basel capital adequacy standards issued by the Basel Committee on Banking Supervision.
Total capital: Common equity, preferred stock, minority interests, long-term debt, non-equity reserves and deferred tax liability in untaxed reserves.
Common equity: Shareholders' total funds minus preferred equity.
Risk capital: Money allocated for speculative investment activities.
Tangible assets: Total assets minus intangible assets such as deferred tax assets and goodwill.
Total debt: All interest-bearing and capitalised lease obligations.
Short-term debt: That portion of debt payable within one year.
Time draft: A demand for payment on a specified future date--comprising banker's acceptance, bill and sight draft.
Time bill: A banker's acceptance or bill of exchange that is not payable until some specific future time. This contrasts with a banker's draft or sight bill, which is good for immediate payment at sight.
HOW WE RANKED THE TOP 100
The Top 100 African banks were ranked according to 'Tier...