One of the major off-site monitoring tool is the Statistical CAMELS Off-site Rating (SCOR) system.
This system was designed to help the FDIC in identifying banks and other institutions that have
experienced noticeable financial deterioration.
The SCOR rates not only the CAMELS composite but also each of the 6 CAMELS components. The components are rated by the same method as with the composite rating.
Now we're going to tell you something about rating of the six components:
1. Capital
Capital level is rated in relation to the institution's risk profile. When the level is less than the satisfactory, the rating informs about a need for improvement. Number one indicates a strong capital level, while number 5 warns the respective institution that the capital level is critically deficient.
The SCOR rates not only the CAMELS composite but also each of the 6 CAMELS components. The components are rated by the same method as with the composite rating.
Now we're going to tell you something about rating of the six components:
1. Capital
Capital level is rated in relation to the institution's risk profile. When the level is less than the satisfactory, the rating informs about a need for improvement. Number one indicates a strong capital level, while number 5 warns the respective institution that the capital level is critically deficient.