Noninterest income is widely used in the literature to account for the degree of the universal business model by banks. This paper proposes a novel measure of universal banking constructed using the relative contribution of each operating segment to total assets using an entropy approach. We here propose a novel dataset containing the Universal Banking Index (UBI) at both country and bank levels. Using a sample of international banks, we evaluate the extent to which our proposed metric affects banks’ profitability, stability, liquidity and capitalisation. Results suggest that a higher degree of diversification is associated with increased stability. In addition, banks that feature a more diversified business model, as proxied by the UBI, are also better capitalised, as opposed to banks with high noninterest income share. Our results suggest that regulatory‐induced restriction on universal banking may indeed reduce the benefits of risk sharing across operating segments, exposing banks to heightened risks.

中文翻译：

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一种衡量通用银行业务的新方法

非利息收入在文献中被广泛用来解释银行普遍商业模式的程度。本文提出了一种新的通用银行度量方法，该方法使用熵方法利用每个经营部门对总资产的相对贡献来构建。我们在这里提出一个新颖的数据集，其中包含国家和银行级别的通用银行业指数（UBI）。我们使用国际银行的样本来评估我们提出的指标对银行的盈利能力，稳定性，流动性和资本化的影响程度。结果表明，更高程度的多元化与增加的稳定性相关。此外，与具有较高非利息收入份额的银行相比，受瑞银（UBI）代理的具有更多元化业务模式的银行的资本也更高。