Ratings are deduced from a system commonly known as the CAMELS rating system
. In this system, there are six components of bank safety and soundness:
The CAMELS rating system
assesses banks according to capital, assets, management, earnings, liquidity, and sensitivity to market risk.
In particular, Bangladesh Bank (BB) to interest rate movement through the introducing of revised CAMELS rating system since 1 July 2006.
Hence the present study is made on Comparative Study of Financial Performance of Banking Sector in Bangladesh: an application of CAMELS rating system with 6562 branches of 48 banks in Bangladesh.
In particular, BB started placing much emphasis on banks sensitivity to interest rate movement through the introduction of revised CAMELS rating system since 1 July 2006.
(1.) Under the CAMELS rating system
, bank supervisors rate institutions according to six factors: capital adequacy, asset quality, management quality, earnings, liquidity, and sensitivity to market risk.
The expanded rating system is known as the CAMELS rating system
. Because our data sample extends only through 1995, none of the examinations in our sample includes this new component.