Evaluation of a bank's return on equity $($ROE$)$

Which of the following are the financial characteristics affecting a bank's return on equity $($ROE$)?$ Check all that apply.

The same income statement items that affect a bank's return on assets $($ROA$)$

The same income statement items that affect a bank's return on assets $($ROA$)$ except loan losses

The bank's degree of finanal leverage

Only noninterest revenues and expenses

Which of the following formulas converts a bank's return on assets $($ROA$)$ into a bank's return on equity $($ROE$)?$

ROE$=$ROA$$ Leverage measure

ROE$=\frac{\text{R}\text{O}\text{A}}{\text{L}\text{e}\text{t}\text{e}\text{r}\text{a}\text{g}\text{e}\text{m}\text{e}\text{r}\text{u}\text{s}\text{u}\text{r}\text{e}}$

ROE$=$ROA$+$ Leverage measure

$))$

$(ure$

Complete the following statement about converting a bank's return on assets $($ROA$)$ into a bank's return on equity $($ROE$).$

When banks use a high degree of financial leverage; banks hold capital to support their assets, which leaves them bank using a very low level of capital experiences a large loss, the loss could its remaining capital. exposed to risk, If a