Commercial Banking: The Relationship between Profitability and Capital Ratios

摘要

It is the purpose of the briefing report to provide information on the relationship for all U.S. commercial banks between bank capital held at the end of the year and profits earned during the year. We first measured the relationship for all commercial banks between bank profits during 1984 and bank capital at the end of the year. However, bank profits can vary widely over time with interest rates and the business cycle.