Capital serves as backup within a contingency loss. Therefore, the greater the bank's capital, the more resistant to external turbulence. Liabilities – are involved funds of the bank: deposits of individuals and legal entities, loans from other banks or the parent structure. Need to pay attention to the ratio proportion of depositors and businesses. In a situation of instability, panic prone more ordinary citizens. (Similarly see: Sonny Perdue). Their behavior can lead to a massive outflow of funds from the bank.
Therefore prefer to be an institution where the share of corporate deposits dominated by or equal to the size of deposits. If money individuals in the bank much more (60-70% of all borrowed funds) – refrain from working with the bank. Assets – is allocated funds of the bank (credit). This indicator also pay attention to the ratio of loans individuals and legal entities. The logic is simple: corporate clients are given a sum far in excess of the sum of individuals. And the number of credits to the population exceeds the number of credits to legal entities. Bank have earnings from interest on loan funds. If the bank loses customer credit as a result of repayment of the loan, then its income falls.
More reliable are the banks with a large portion of loans to natural persons. Should also pay attention to the ratio of loans to deposits. Loans are attracted funds in the domestic (household deposits and businesses) and external (foreign investors) market. The more loans funded by deposits, the stronger will continue your contributions to this jar.