Question

Publicly traded banks generally trade close to a Price/Book ratio of 1x because _______.

Strong competition in their local markets

Little product differentiation

Assets and liabilities are worth close to the market value

All of the above

Answer 1

Publicly traded banks generally trade close to a Price/Book ratio of 1x because

answer-All of the above

because in publicly traded banks there is a strong competition as there are so many players avialable in the market and also most of the banks offer more or less same product so there is little product differentiation and also assets and liabilities are worth close to the market value so publicly traded banks generally trade close to a Price/Book ratio of 1x.