What is Residual Income

This chapter examines in particular the valuation of banks which can be classified into five parts. It introduces several valuation approaches to find out whether there is a superior method. This chapter starts with a description of bank regulations and their impact on bank valuations and continues with an overview of valuation approaches. The second part applies the banking sector decision Models. The third section shows banking sector valuation models. The fourth part presents the input factors that are needed to value a company. In the last part, financial statements have been used to analyze the main ratios of the Bank of America, and the calculated values were then compared over time (2014-2018) to assess the explanatory power of the bank.