Gladys Bank & Trust has $360 million in consumer loans with an average interest rate of 7.25
Question:
Gladys Bank & Trust has $360 million in consumer loans with an average interest rate of 7.25 percent. The bank also has $240 million in home equity loans with an average interest rate of 5 percent. Finally, the company owns $60 million in government securities with an average rate of 3 percent.
Managers at Gladys Bank & Trust estimate that next year its consumer loan portfolio will fall to $320 million and the interest rate will increase to 8.75 percent. They also estimate that its home equity loans will increase to $280 million with an average interest rate of 7 percent, and its government securities portfolio will increase to $75 million with an average rate of 6.5 percent.
Required
Estimate the revenues for the coming year for Gladys Bank & Trust.
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