Why is ROE generally much higher than ROA for banks relative to other industries?

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Fundamentals of corporate finance

ISBN: 978-0470876442

2nd Edition

Authors: Robert Parrino, David S. Kidwell, Thomas W. Bates

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Question Posted: Jun 08, 2012 12:17 AM

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Why is ROE generally much higher than ROA for banks relative to other industries?

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Banks have a very small equity base relative to firms ...View the full answer

Fundamentals of corporate finance

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