Comparing and evaluating the financial performance of US commercial Essay

Comparing and evaluating the financial performance of US commercial banks during the recession - Essay Example The study tells that the recent financial crisis began in 2008 – although signs of the crisis could be identified in 2007; since then, the crisis has being expanded in all countries worldwide causing severe losses to businesses of all industrial sectors. In its primary form, the crisis was related with the banking sector in US; in fact, the subprime products that were promoted by the US banks were proved to be more risky than initially estimated; as a result, US banks were highly exposed to the recession. Many banks in US collapsed – as a consequence of the crisis; however, there were also those banks that managed to limit the losses and protect effectively their equity/ capital. This study will help to understand the effects of recession on the financial performance of US commercial banks using the figures included in these organizations’ financial statements. In other words, it will be an evidence – based study not just a critical analysis of the behavio r of these firms since the beginning of the crisis. On the other hand, the level of resistance of US banks – as identified through this study – would be valuable in order to estimate the expected development of the US banking industry both in the short and the long term – the prospects for the development of US firms that operate in other industrial sectors could be also estimated using similar criteria. The study also identifies the framework of successful strategic decisions – referring to the banking industry – a fact that could further lead to the increase of this sector’s credibility.