Bank Balance Sheet & Leverage Ratio

Stylized balance sheet of depository institution to illustrate (1) high leverage, (2) dependency on spread (ROA - COF) and (3) key ratios: leverage, and Basel's Tier 1 leverage ratio

Category:

Education

Tags:

• bank
• balance
• sheet
• leverage
• Tier
• Basel

[ernestdautovic]

well done!



[djmulligan1]

thank you, this assisted me in reading today's paper about big American banks not wanting to receive huge deposits (depositors motivated by worries about Europe) because of the lowering of capital-asset ratios.

[BIueViolin]

Great video . So what a hell am I being teached at university ?!!? I mean seriously?!

Nothing about the core capital leverage or risk-based Tier I capital.

[bionicturtledotcom]

@bionicturtledotcom ... and the liabilities i am showing are on-balance sheet, so your 6x doesn't apply to my stylized example anyway

[bionicturtledotcom]

@jeremyj2e the point is the *stylized* example is to emphasis that off-BS assets do contribute to RWA, not to size them realistically (obviously). I didn't drill down to intangibles (obviously). Liabilities at 6x equity is not misleading: it's a bank, they are leveraged. But thank you for the useless nitpicks

[fal2grace]

Thank you very much.

[adrock182]

EXCELLENT

[makkala123]

I was under the impression that reserves were also part of tier2 capital. Is is not true?

[ano5505]

thanks for wonderful video

regards

anoop mohanty...

[iskanderbadshah]

this is great. thank you.