During the latest financial tsunami in March 2009 (and November 2008),if investors believe the financial institution has to make a 10% loss provision for the asset it is holding

Economics Nov 09, 2020

During the latest financial tsunami in March 2009 (and November 2008),if investors believe the financial institution has to make a 10% loss provision for the asset it is holding. How can we use the relationship between the return on assets, the return on capital and the asset-capital leverage for banks and financial institutions to discuss the effect the loss provision on the financial institution's capital and share price? Will the share price drop to zero?