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Following are the financial ratios of Dubai Commercial bank and Dubai Islamic bank for comparative analysis. Ratios DUBAI COMMERCIAL DUBAI ISLAMIC BANK BANK Return on

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Following are the financial ratios of Dubai Commercial bank and Dubai Islamic bank for comparative analysis. Ratios DUBAI COMMERCIAL DUBAI ISLAMIC BANK BANK Return on Equity (ROE) 18.65% 16.30% Return on Assets (ROA) 1.26% 1.34% Equity multiplier 12.73 12.20 Required: 1. Analyze ROE (return on equity) and evaluate what it indicates? (2.5marks) 2. Analyze ROA (return on Assets) and evaluate what it indicates? (2.5marks) 3. Analyze equity multiplier and evaluate what it indicates? (2.5 marks) 4. Evaluate why it is said that a high equity multiplier does not always equate to higher investment risk. ( 2.5 marks)

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