Tangible Book Value (TBV)
Book value excluding intangible assets like goodwill.
Definition
Tangible book value strips out goodwill and other intangible assets from total stockholders' equity, leaving only tangible net worth. For banks, TBV per share is often considered a floor valuation since it represents the liquidation value if all assets were sold at book value.
Formula
TBV = Stockholders' Equity - Goodwill - Other Intangibles
Why It Matters
TBV per share is the valuation anchor for bank stocks. During periods of stress, bank stocks often trade down to or below TBV. Growth in TBV per share over time is one of the best measures of long-term shareholder value creation.