efficiency ratio

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Efficiency Ratio

In banking, a ratio of expenses to revenue. For example, if a bank spends $10 million and makes $15 million in a given month, its efficiency ratio is .67. Banks desire a lower efficiency ratio because this means that the bank is making considerably more than it is spending and is therefore on sound fiscal footing. One way to conceptualize the efficiency ratio is to say it is the measure of what a bank must spend in order to make one dollar. In the above example, the bank must spend 67 cents.

efficiency ratio

The ratio of leasable space to gross space in a building.When planning a building, it is important to balance the need to maximize the efficiency ratio in order to lease the maximum amount of space possible,against the aesthetic need to have wide corridors and open spaces.

References in periodicals archive ?
of Conway set its sights on achieving a sub-40 percent efficiency ratio.
The efficiency ratio is designed to be neutral to countries' stages of development, and the data indeed reflect this neutrality.
Measure labor through a Labor Efficiency Ratio (LER)
They are designed for coolant outlet temperatures of -15 to +15 [degrees]C, and operate with an energy efficiency ratio (EER) of approximately 5.
For the efficiency ratio, the First Look program credit unions reported an average ratio of 92.
The Energy Efficiency and Renewable Energy Network recommends that room air-conditioners should have an Energy Efficiency Ratio of at least 9.
If you are interested in understanding things which impact the cost of the heating and cooling in your home, it is important that you understand the concepts of annual fuel utilization efficiency (AFUE) and seasonal energy efficiency ratio (SEER).
Record loan growth, excellent asset quality and a record efficiency ratio contributed to our favorable third quarter results and helped us achieve our 19th consecutive quarter of record net income and earnings per share," said George Gleason, chairman and CEO.
As part of ISS' decision to support Bancorp Rhode Island's nominees, the report stated "Management informed ISS that it expects BARI's efficiency ratio to decline to 65 percent in the short-term, closer to its peer group average of 61 percent.
The company's efficiency ratio for the quarter improved to a record 43.
Due to the increase in operating expenses of banks in areas related to information-technology enabled systems and personnel costs, the efficiency ratio of the banking sector deteriorated from 63.

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