Loans to Assets Ratio
‘Loans to assets ratio’ is a financial ratio that usually is applied for banks (or credit unions) to measure the relation of the bank’s loan portfolio to the total assets.
Providing loans for clients is a main function of every bank, and it is normal that high part of bank’s assets is in loans form. Usually loans are provided for both: business clients and retail clients, but the exact structure of the loan portfolio depends on the strategy of the financial institution.
High ‘loans to assets’ ratio might mean two things:
Another similar ratio is ‘loan to deposit ratio’.
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