are frequents customers always customers

Topics: Value, Financial markets, Value network Pages: 19 (4173 words) Published: April 21, 2014
Electronic copy available at: 1
Karol Śledzik*
University of Gdansk
Faculty of Management
Department of Banking
ul. Armii Krajowej 101
81-824 Sopot, POLAND
The main goal of this paper is to present practical application of taxonomy (Multidimensional Comparative Analysis - MCA) to measure the level of intellectual capital of banks using VAIC™ (Value Added of Intellectual Coefficient) and MV/BV (Market Value to Book Value) ratio. The study includes an estimate of the value of synthetic indicator which is Euclidean distance from Positive Development Pattern (PDP) of the group of 20 banks (10 domestic and 10 European) in 2006-2009 period. As a result, author made a ranking of banks on intellectual capital. KEYWORDS Intangible resources, Intellectual Capital, banks, multidimensional analysis, taxonomy JEL CLASSIFICATION CODES

G32, O3, O16
Functioning of banks on the financial market under conditions of high volatility environment necessitates the use of modern methods and instruments of financial management. In the capital market intellectual capital (also called - intangible resources) should not be considered the as a value added. Intellectual capital (IC) is the absolute requirement of allowing banks to compete. The high level of IC and its effective management determines the bank's strong competitive position and, consequently, the construction of its value. To manage the IC there is necessary to use special valuation tools. Author took S. Bailey's [1] assumptions about the relativity measurement process as the most important factor. The purpose of this paper is to present practical applications of taxonomy which is a multidimensional comparative analysis (MCA) to assess the level of intellectual capital of banks, using VAIC ™ (Value Added of Intellectual Coefficient) and MV/BV ratio (Market Value to Book Value). The main source of empirical data are carried out by the author of the study, covering the period 2006-2009. The research includes the banks listed on the Warsaw Stock Exchange1 and selected European banks2 which are the Peer Group.

* e-mail:
1 The group of ten polish banks consists of: Pekao S.A., PKO BP S.A., BZWBK S.A., BRE Bank S.A., ING BS S.A., Handlowy S.A., Getin Holding S.A., BOŚ S.A., Millennium S.A., Kredyt Bank S.A. 2 The group of ten European banks consists of: Komercni Banka A.S., AKBank T.A.S., OTP Bank Plc, Banco de Sabadell S.A., Banco BPI S.A., Grupo Banco Popular S.A., Spar Nord Bank A/S, Alpha Bank S.A., Intesa Sanpaolo SpA, EFG Eurobank Ergasias S.A.

Electronic copy available at: 2
The paper presents the possibility of using Euclidean distance from the Positive Development Pattern (PDP) to identify those banks which are characterized by the highest levels of intellectual capital. The procedure consisted of the following stages of the calculation: 1. Creating a matrix of observations X

(i = 1,..., n, j = 1,...,m) (1)
- the value of j-th features of the i-th object
The features were adopted intellectual capital indicators (VAIC™ and MV/BV). Objects were 20 banks consisting of 10 banks listed on the Warsaw Stock Exchange and selected 10 European banks. The matrix has been determined for the years from 2006 to 2009. 2. Due to the fact that all the features are stimulants author abandoned procedure to bring uniformity characteristics. The next step of the study was to bring the different variables comparable titers with standardization. As a result of diagnostic standardization of each variable had a mean value of 0 and standard deviation equal to 1. Standardization was made according to the following formula: j

ij j
ij S
x x
(i = 1,..., n, j = 1,...,m) (2)
- the value of j-th features of the i-th object
j x - the arithmetic mean of...

References: [1] Bailey S., A critical dissertation on the nature, measure and causes of value, 1825, source:
[2] Sveiby K.E. 2010, Methods for Measuring Intangible Assets,, (online version);
[3] Daum J.H. 2002, Intangible Assets and Value creation, John Wiley & Sons, United Kingdom;
[4] Andriessen D., 2004, Making sense of Intellectual capital, Designing a method for the
[6] D. Ghosh, A. Wu, 2007, Intellectual capital and capital markets: additional evidence, “Journal
of Intellectual Capital”, Vol
[7] Pulić A, 2004, An Accounting Tool for IC Management, source:
[8] P
[9] Lev B., 2001, Intangibles, Management measuring and reporting, the brooking institution,
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