Residual income

Residual income

Value of available-for-sale securities				↓
Other comprehensive income (OCI) section of stockholders' equity				↓
Net income				↑(*1)
ROE				↑
Book value				- (*2)
Residual income				↑ (*3)

(*1) A decrease in the value of the available-for-sale securities that bypasses the income statement would artificially increase net income and, consequently, ROE.

(*2) Book value is unaffected as the decrease is accounted for in the OCI section of the shareholders' equity.

(*3) due to higher ROE