Banking Practice Exam

All of the listed metrics—Return on Assets (ROA), Return on Equity (ROE), and Assets per Depositor—are indeed measures of bank productivity, each providing unique insights into different aspects of a bank's operational efficiency and effectiveness.

Return on Assets (ROA) assesses how effectively a bank uses its assets to generate profit. A higher ROA indicates that the bank is more efficient in converting its investments into net income, reflecting a strong management performance.

Return on Equity (ROE) evaluates the profitability relative to shareholders’ equity, highlighting how well a bank utilizes its equity base to produce profit. A higher ROE points to the bank's capacity to deliver returns to shareholders, showcasing overall financial health and operational performance.

Assets per Depositor calculates the average assets managed for each depositor, helping to understand how well the bank is leveraging its deposit base. This metric can indicate how efficiently a bank is using its deposits to generate income through loans and other investments.

Each of these metrics provides valuable insight into different facets of bank productivity, reinforcing the idea that assessing bank efficiency and performance requires a comprehensive view through multiple lenses. Therefore, the correct choice encompasses all as valid measures of bank productivity.