In order for ratio analysis to be meaningful for a bank holding company,a large portion of the services should be bank-related.

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Ratio analysis is mainly used to assess the financial performance of companies, including bank holding companies. However, for the analysis to be meaningful, a substantial part of the services offered by the company should be related to banking activities. This is because the financial ratios used in the analysis are specifically designed for financial institutions, and may not accurately reflect the performance of companies that have a diverse range of operations. Therefore, a bank holding company that derives a significant portion of its revenue from non-bank related activities may not be accurately assessed using traditional financial ratios.

In Order for Ratio Analysis to Be Meaningful for a Bank