The Cross Section of Bank Value

78 Pages Posted: 23 Mar 2017 Last revised: 1 Jul 2021

See all articles by Mark Egan

Mark Egan

Harvard University - Business School (HBS); National Bureau of Economic Research (NBER)

Stefan Lewellen

Pennsylvania State University

Aditya Sunderam

Harvard University

Multiple version iconThere are 2 versions of this paper

Date Written: June 30, 2021


We study the determinants of value creation in U.S. commercial banks. We develop novel measures of individual banks' productivities at collecting deposits and making loans, which we relate to bank market values. We find that deposit productivity is responsible for two-thirds of the value of the median bank and most variation in value across banks. Variation in productivity is driven by differences across banks in technology, customer demographics, and market power. We also find evidence of synergies between deposit-taking and lending. Our findings suggest that there is significant heterogeneity in banks' abilities to capture value by manufacturing safe assets.

Keywords: Bank value, safe assets, screening and monitoring, bank synergies, deposit productivity, asset productivity

JEL Classification: G21, G32, E44, D22, D24, L21, L22, L23, L25

Suggested Citation

Egan, Mark and Lewellen, Stefan and Sunderam, Aditya, The Cross Section of Bank Value (June 30, 2021). Available at SSRN: or

Mark Egan

Harvard University - Business School (HBS) ( email )

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National Bureau of Economic Research (NBER) ( email )

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Stefan Lewellen (Contact Author)

Pennsylvania State University ( email )

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University Park, PA 16802
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Aditya Sunderam

Harvard University ( email )

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