What is Merchants Bancshares Probability of Financial Distress (%)?
Probability of Financial Distress (%) measures the probability that a company will go bankrupt in the upcoming year given its current financial position. A higher ratio indicates a larger probability of bankruptcy for the company, while a lower ratio indicates a healthier fundamental. As of today, Merchants Bancshares's Probability of Financial Distress (%) is 0.00%.
Like the Altman Z-Score, the PFD measures a company's bankruptcy risk. However, the main drawback of the Z-score is it does not apply to banks and insurance companies. According to Investopedia, the concept of "working capital" does not apply to banks and insurance companies, as financial institutions do not have typical current assets or current liabilities like inventories or accounts payable.
Competitive Comparison of Merchants Bancshares's Probability of Financial Distress (%)
For the Banks - Regional subindustry, Merchants Bancshares's Probability of Financial Distress (%), along with its competitors' market caps and Probability of Financial Distress (%) data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Merchants Bancshares's Probability of Financial Distress (%) Distribution in the Banks Industry
For the Banks industry and Financial Services sector, Merchants Bancshares's Probability of Financial Distress (%) distribution charts can be found below:
* The bar in red indicates where Merchants Bancshares's Probability of Financial Distress (%) falls into.
Merchants Bancshares Probability of Financial Distress (%) Calculation
Probability of Financial Distress (%) (PFD) was developed by John Campbell, Jens Hilscher and Jan Szilagyi in their Search of Distress Risk. It measures the probability that a company will go bankrupt within the next 12 months given its current financial position.
The Probability of Financial Distress (%) was obtained by a logit probability model based on eight explanatory variables. The logit formula to compute the probability of financial distress (LPFD) is given below:
| LPFD | = | -20.12 * NIMTAAVG | + | 1.60 * TLMTA | - | 7.88 * EXRETAVG | + | 1.55 * SIGMA | - | 0.005 * RSIZE | - | 2.27 * CASHMTA | + | 0.070 * MB | - | 0.09 * PRICE | - | 8.87 |
| = | 0.00 |
The Probability of Financial Distress (%) (PFD) was then obtianed by:
| PFD | = | 1 | / | (1 + e^(-LPFD)) | * | 100% |
| = | 0.00% |
The eight explanatory variables are:
1. NIMTAAVG = Net Income to Market Total Assets
*Note that for companies reported quarterly, geometrically declining weighted quarterly Net Income data in latest four quarters are used.
2. TLMTA = Total liabilities to Market Total Assets
3. CASHMTA = Cash to Market Total Assets
For banks, CASHMTA is measured as:
4. EXRETAVG = Excess Return compared to the S&P 500
EXRETAVG is the weighted excess return compared to the S&P 500 in past 12 month. Geometrically declining weights are imposed on the monthly excess return to reflect lagged information. The weight is halved each quarter.
5. SIGMA = Standard Deviation of Daily Returns
For sigma, we use the annualized standard deviation of a company's returns over the past 92 days (or 63 trading days).
6. RSIZE = Relative Size
| RSIZE | = | log (Market Cap | / | Total Market Cap of S&P 500 companies) |
7. MB = Market to Adjusted Book Equity Ratio
8. PRICE
PRICE is measured as the log of the stock price, capped at log(15).
Merchants Bancshares (Merchants Bancshares) Business Description
Traded in Other Exchanges
N/A
Address
Merchants Bancshares Inc is a bank holding company organized under Vermont law in 1983. Merchants Bank, the Company's primary subsidiary, is a Vermont commercial bank with 32 full-service banking offices located throughout the state of Vermont. The Company, through its subsidiary, offers a full range of deposit, loan, cash management, and trust services to meet the financial needs of individual consumers, businesses and municipalities at 32 full-service banking offices throughout the state of Vermont. Its trust division offers investment management, financial planning and trustee services. The Company competes in Vermont for deposit and loan business not only with other commercial and savings banks, and savings and loan associations, but also with credit unions and other non-bank financial providers. It is subject to extensive regulation and supervision, including, in many cases, regulation that limits the type and scope of its activities.
Executives
| Jeffrey L Davis |
director |
275 KENNEDY DRIVE, SOUTH BURLINGTON VT 05403 |
| Pecor Raymond C Iii |
director |
1 KING STREET DOCK, BURLINGTON VT 05401 |
| Richard M Donovan |
officer: Interim PAO, PFO and Treasurer |
C/O FIRST SEACOAST BANCORP, 633 CENTRAL AVENUE, DOVER NH 03820 |
| Bruce M Lisman |
director |
C/O MERCHANTS BANK, 275 KENNEDY DR, S. BURLINGTON VT 05403 |
| Eric Andrew Segal |
officer: Interim PAO, PFO and Treasurer |
6489 DEERFIELD DRIVE, NEW HOPE PA 18938 |
| Thomas J. Meshako |
officer: Treasurer and CFO |
MERCHANTS BANK, P.O. BOX 1009, BURLINGTON VT 05402 |
| John A Kane |
director |
C/O MERCHANTS BANCSHARES, INC., 275 KENNEDY DRIVE, SOUTH BURLINGTON VT 05403 |
| F Sheldon Prentice |
officer: Senior Vice President |
C/O NBT BANCORP, 52 BROAD STREET, NORWICH NY 13815 |
| Charles A Davis |
director |
1 CAPE MAY ST, 1 CAPE MAY ST, HARRISON NJ 07029 |
Merchants Bancshares (Merchants Bancshares) Headlines
Quick Browse
Personalize
Premium Gurus 
Create New Portfolio
Portfolio Contest
MBVT has been successfully added to your