Ukrainian banks — financial condition analysis (CAFELS)

CAFELS is VRAnalytics' adapted banking rating framework: CAMELS-style component analysis with Flows (F) replacing Management (M), using net cash flow and activity composition alongside capital, assets, earnings, liquidity, and sensitivity.

The composite score and probability of default (PD) are derived from these six pillars. Scores are research tools — not credit ratings or investment advice. Open a bank-level report or read the full methodology PDF for calculation details.

CAMELS vs CAFELS

Letter CAMELS (classic) CAFELS (VRAnalytics)
CCapital adequacyCapital adequacy — unchanged
AAsset qualityAsset quality — unchanged
FManagementFlows — NCF, operating / investing / financing split, composition of activities
EEarningsEarnings — unchanged
LLiquidityLiquidity — unchanged
SSensitivity to market riskSensitivity — unchanged

Replacing Management with Flows makes the assessment objective and data-driven: cash generation, sustainability of operating cash, and how activities are funded can be measured directly from bank reporting.

Six CAFELS components

C

Capital adequacy

Evaluates the strength and growth of regulatory and own funds relative to risk-weighted exposures and balance-sheet size.

  • Equity / assets ranked vs banking-market mean, median, and percentile
  • Leverage ratio, debt-to-equity (D/E), ROCE, working capital ratio
  • Simplified CAR and RWA (EBA/CRR standardised approach weights)
A

Asset quality

Assesses credit risk in the loan and investment portfolio, asset concentration, and deterioration signals in balance-sheet structure.

  • Asset composition and loan-book share
  • ECL / assets (%) from provision accounts ending in 9
  • Benchmark vs median ECL among banks with similar asset structure — above market is unfavorable
  • Relative asset growth and balance-sheet risk signals
F

Flows

Replaces Management (M) in CAMELS. Measures how the bank generates and uses cash — net cash flow (NCF) and the composition of operating, investing, and financing activities.

  • Operating, investing, and financing cash flows
  • Net cash flow (NCF) level and month-to-month change
  • Activity composition (CashMVNT structure)
  • FinManagement quality and FinStability from cash-flow sustainability
E

Earnings

Covers profitability, income quality, and expense efficiency — whether earnings are sufficient to absorb losses and support capital.

  • Profit / loss after tax and ROA
  • Income and expense category mix
  • Profit drivers versus sector and peers
L

Liquidity

Examines the ability to meet short-term obligations: liquid assets, funding structure, and reliance on volatile funding sources.

  • Cash, NBU placements, and interbank balances
  • Marketable securities (incl. amortised cost, FVOCI, trading)
  • Deposit vs wholesale funding mix
S

Sensitivity to market risk

Captures exposure to interest-rate, FX, and other market moves that can erode capital or earnings under stress.

  • Financial stability indicators (FinStability)
  • Market-sensitive balance-sheet items
  • Sector stability dynamics over time

Composite score and PD

Component signals from C, A, F, E, L, and S are combined into a single probability of default (PD) estimate for each bank and reporting date. The PD maps to a letter score on the VRAnalytics scale (from aaa to c).

For monitoring, points are shown as (1 − PD) × 100 — higher is better. Use the calculator below for bank-level CAFELS component ratings, or open a full report for 12-month history.

Open bank financial condition reports Score methodology (PDF)

Calculate CAFELS for a bank

Select a Ukrainian bank to compute component ratings (1 = strong, 5 = weak) from the same balance-sheet, cash-flow, ROA, and income/expense ratios used across VRAnalytics.