Consider the following data (in $ billions) for the following two banks for 2017.
PNC Financial Services Bank of America Net income $5.34 $18.23 Interest income $10.81 $15.07 Noninterest income $7.22 $9.32 Total assets $380.77 $2281.23 Total equity $47.51 $267.15
(1) Use DuPont Identity to decompose the ROE of the two banks
(2) Which bank’s ROE was higher? What is the reason for the difference in ROE between PNC Financial Services and Bank of America from your DuPont analysis above?
