Friday, 12 October 2012

Chart(s) of the Day: ROE and Equity/Asset Ratio for U.S. Banks

That's a poor return on equity...

 
For highly leveraged balance sheets...
 
 
Better make sure that is reflected accordingly in the valuations if you consider buying shares in U.S. banks. And don't forget to add a margin of safety for all the known and unknown balance sheet exposures.

And certainly do not forget all the U.S. treasury and agency securities the banks are sitting on, especially the overvalued long term treasury securities.


 

No comments:

Post a Comment