Estimating the Overall Financial Performance of Mexican Banks Using a New Method for Quantifying Subjective Information
Posted: 16 Apr 1998
In this article we estimate the overall financial performance of Mexican banks using a new method (hereafter ASPID) for quantifying subjective information. Financial analysts typically collect considerable numerical information on multiple criteria that pertain to the financial performance of firms and must eventually aggregate (or synthesize) this information into an overall assessment. Unfortunately, analysts can only make subjective evaluations concerning the relative importance of different criteria under consideration, such that the final results of comprehensive evaluations tend to be subjective also. The proposed method attempts to overcome this problem by generating stochastic estimates of overall performance based on multiple criteria for which numerical information is available in addition to subjective judgments concerning the relative importance of these criteria.
JEL Classification: G21
Suggested Citation: Suggested Citation