Marco Marozzi

Composite indicators are very useful in addressing complex variables that cannot be directly observed: they can be used to assess for example quality of life and customer satisfaction...

After the Basel II accord, banks should not distribute funds without considering which sector firms belong to, as usually done. In this context, we would like to compare firm sector for what concern different financial ratios. Through a suitable multivariate nonparametric test we evaluate whether or not sectors can be distinguished with respect to the ratios. The analysis of a data set about positions from a medium size Italian financial institution clearly contradict the common banking practice of distributing funds without considering which sector firms belong to and strongly recommend for alternative credit treatment.