This research presents the results of a financial analysisof the Security Pacific Corporation, a holding company whose major operating company is the Security Pacific Bank (Brophy, 1990). Included in this analysis are (1) an industry analysis, (2) a description of the bank's goals and objectives, (3) an analysis of the bank's management team, and (4) a financial analysis, to include (a) a ratio analysis, (b) income trends, (c) analysis of dividend payments, (d) analysis of capital structure, and (e) an assessment of the financial statement notes. INDUSTRY ANALYSIS
The current trough to peak cycle of American economic per formance is (in May 1990) in its 89th month. Thus, in light of the 45 month mean for the past eight cycles, it is not surpris ing that many economists expect a recession, however mild, by early 1991. Nevertheless, most economists project continued economic growth, albeit sluggish growth for the coming year or two (Value Line 1990).
In 1990, the American banking industry is in the ninth year of deregulation. At this time, there is a blurring of the functions of the major players in the industry, as well as the
1 2presence of many new players. Commercial banks, which were prohibited from dealing in securities by the Securities Exchange Act of 1933, are once again permitted to engage in such activities to a limited extent. Non bank organizations, such as securities brokers, are permitted to engaged in some commercial banking activities (Shafran, 1990).
The Federal Reserve Board is attempting to extend its regulatory authority to non bank organizations, when they engage in banking activities. These attempts by the Board are being challenged in federal courts by the non bank organiza tions which will be affected.
The distinction between commercial banks and thrift insti tions has also been blurred. Thrift institutions are now per mitted to engage in all retail banking activities, and...