Considering the balance sheet for all commercial banks in the U.S., the net worth of banks is:

Question

Quizplus · Accepted Answer

Net worth is equal to total assets minus total liabilities, so it cannot be greater than total assets. Additionally, banks typically operate with leverage, which means they have more assets than net worth. Therefore, the net worth of banks is typically a small fraction of total assets. According to recent data from the Federal Reserve, the average net worth-to-total assets ratio for U.S. commercial banks is about 1/11 or 9%.

Considering the Balance Sheet for All Commercial Banks in the U.S