A Proposal on the “i Bank Index,” A Measure of Banks’ Ability to Nurture Client Businesses
Banks can greatly affect the development of firms; we offer an index to measure this ability.
Banks nowadays are required not only to act as providers of capital but also to provide consultation to and continuously support the restructuring and development of client firms through long-term business relationships.
We aim to evaluate banks based on the degree to which they contribute to the growth and development of client firms. Banks can reaffirm the meaning of their existence by making improvements in their client firms’ performance over the long term. It is therefore desirable to align banks’ evaluating index with the aforementioned goal. The new index is defined as the difference between the average for a specific indicator of management among a bank’s client firms and the national average on the particular indicator. The new index will highly value banks that are able to improve the performance of client firms according to those indicators.