2023 annual reports of Australia and New Zealand Banking Group (ANZ) and Commonwealth bank of Australia (CBA). Compile a table with the following data from these two banks (5 Marks): Asset ANZ Amount % of total assets CBA Amount % total assets of Average Amount % of total assets Cash Trading securities Investment securities Loans Other assets Total assets When constructing this table please note that: The annual reports of banks are normally for the total group of companies with consolidated figures and separate figures for the bank only (parent entity). Please use group figures for this case study. Cash is with some banks shown as cash and liquid assets - Use the total amount of cash and liquid assets as cash if cash is not shown separate as cash only. Total assets = the total assets in the balance sheets of the banks. Therefore you have to calculate other assets as Total assets - loans - investment securities - trading securities - cash. Step 2: Discuss each of the asset types contained in the table that you constructed in step 1 by providing the following explanations: 1. Cash (3 Marks) a. The purpose and importance of the type of asset. b. The average monetary size (as % of total assets) of banks and differences between the % sizes of this asset between banks. If the differences in the % sizes of this asset between banks are significant, please try to provide possible reasons for the differences by considering information provided in the annual reports of the banks. c. Methods/instruments that banks use to hedge the risks pertaining to this type of asset. d. The income generated from the type of asset compared to the income generated from other types of assets. 2. Trading securities (3 Marks) a. The purpose and importance of the type of asset. b. The average monetary size (as % of total assets) of banks and differences between the % sizes of this asset between banks. If the differences in the % sizes of this asset between banks are significant, please try to provide possible reasons for the differences by considering information provided in the annual reports of the banks. 1/6

c. Methods/instruments that banks use to hedge the risks pertaining to this type of asset. d. The income generated from the type of asset compared to the income generated from other types of assets. 3. Investment securities (3 Marks) a. The purpose and importance of the type of asset. b. The average monetary size (as % of total assets) of banks and differences between the % sizes of this asset between banks. If the differences in the % sizes of this asset between banks are significant, please try to provide possible reasons for the differences by considering information provided in the annual reports of the banks. c. Methods/instruments that banks use to hedge the risks pertaining to this type of asset. d. The income generated from the type of asset compared to the income generated from other types of assets. 4. Loans (3 Marks) a. The purpose and importance of the type of asset. b. The average monetary size (as % of total assets) of banks and differences between the % sizes of this asset between banks. If the differences in the % sizes of this asset between banks are significant, please try to provide possible reasons for the differences by considering information provided in the annual reports of the banks. c. Methods/instruments that banks use to hedge the risks pertaining to this type of asset. d. The income generated from the type of asset compared to the income generated from other types of assets. Step 3: Summary/conclusion Use the information contained in the table (step 1) and your answers provided in step 2 to write up a conclusion about whether the average monetary/percentage sizes of the different assets are optimum or whether banks can increase/decrease the sizes of the different assets to increase their profits without increasing risks substantially (3 Marks).