This Book ‘The Bank Investors Handbook’ is written by Nathan Tobik & Kenneth Yellen.
I picked up the Book looking for new insights into banking stocks.
However, the Bank is written for the invoice investor in mind.
It covers the basics of banking in a very easy to understand manner.
The Book is very US centric and does not do a good job of illustrating with examples.
One takeaway from the Book I found interesting was the concept of
“Bicycle Stability Vs Table Stability”
A bicycle at speed and a table at rest are both stable items.However, for the bicycle to remain stable it needs to be continually propelled forward, whereas a table is by nature stable.
When banks engage in short term , high interest lending (Consumer,auto ,gold etc) they are in continuous search of new borrowers as the old borrowers churn off.
The authors discuss the different approaches to investing in Bank Stocks.One approach is management change…worked very well in the case of RBL Bank here in India,
Do buy this Book only if you are starting out investing in Bank Stocks.
