Heuristics of having a high
tangible capital ratio would aid regulation.
Need to negotiate
a tangible capital ratio, and a transition period.
Need a simple
tangible capital ratio.
Insured commercial banks had high capital levels at the time of the crisis — 10 % (DM: but look at
the tangible capital ratios)
Not exact matches
Here, ROC is the
ratio of the pre-tax operating earnings (EBIT) to
tangible capital employed (Net working
capital + Net fixed
capital).
You will find that many
capital intensive industries tend to have greater debt / equity
ratios as
tangible assets are financed using debt.
Interesting and sometimes compelling idea that may be very illiquid, may be a probability bet with a favourable asymmetrical reward to risk
ratio, or may simply be a low quality business that is very cheap relative on a net - net working
capital or price /
tangible book value basis.