Bank Analysis School eBook

Internal Use Only

Economic Value of Equity Results at Tostitos Bank Didn’t Align with the Balance Sheet Structure

At the last exam, EVE was shown to drop 50% in this same scenario! Lesson: Non-maturity deposit decay rates/average lives drive EVE results and can be manipulated to mask the risk of a long-term asset structure.

Internal Use Only

Independent Activity

• See handout with STMR commentary and questions.