1 Capital ratio, leverage ratio and credit risk, 15 points A commercial bank's T-account in 2018 is shown as below: Table 1: T-Account for Bank A in 2018 Assets Loans: 800 Securities: 100Borrowings: S0 Cash Reserves: S 60 Equity:? Liabilities plus Equity Deposits: $900 The bank pays 10% for the bank deposit to the depositors, the average interest rate on the loans is 15%; and the returns to its securities is 10%. (1) Calculate the value of equity, the value of capital ratio and the leverage ratio? (2) If S 100 of the loans is defaulted, what does the new T-Account look like? What is the new equity value? Will the bank become insolvent