What happens to the value of bank equity

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Reference no: EM132970135

If the bank managers decide to issue shares of stock to the public the proceeds would go on the balance sheet as cash and this would increase the value of bank equity.

What happens to the value of bank equity when the value of mortgages declines?

What happens to the Net Worth of a bank when the value of its assets falls relative to the value of its liabilities?

What will happen to bank profits if the cost of funds increases but the interest earned on assets remains the same?

Bank revenues are derived from interest they earn on loans they make to customers, from fees they charge customers, from interest they earn on investments and from the sale of assets. Banks have administrative costs and costs that arise from paying interest on deposits and other borrowings.

Reference no: EM132970135

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