In the economic spread analysis, a tax penalty is allocated to a banks interest spread on loans

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In the economic spread analysis, a tax penalty is allocated to a bank’s interest spread on loans but no tax credit is allocated to the interest spread on deposits. Why does that not violate the Modigliani and Miller theorem?

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Valuation Measuring and managing the values of companies

ISBN: ?978-0470424704

5th edition

Authors: Mckinsey, Tim Koller, Marc Goedhart, David Wessel

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Question Posted: Aug 12, 2015 02:29 AM

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In the economic spread analysis, a tax penalty is allocated to a banks interest spread on loans

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The Modigliani and Miller theorem states that the capital structure of ...View the full answer

Valuation Measuring and managing the values of companies

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