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3 points Save Answer A bank has issued a line of credit of 26,650 USD to company XYZ. The company drew 12,508 USD out of
3 points Save Answer A bank has issued a line of credit of 26,650 USD to company XYZ. The company drew 12,508 USD out of it. The bank has estimated that the likelihood of the company defaulting is 0.024 (in percent), that the portion of the loan that cannot be recovered in case of default is 0.481 (in percent) and that the percent of the committed, yet un-drawn, balance that is assumed will be drawn in the case of a default is 0.358 (in percent). Calculate the bank's expected loss. EAD = Ldrown+Lundrown*UGD. EL = EAD * LGD * PD A bank has issued a line of credit of 26,650 USD to company XYZ. The company drew 12,508 USD out of it. The bank has estimated that the likelihood of the company defaulting is 0.024 in percent that the portion of the loan that cannot be recovered in case of default is 0.481 (in percent) and that the percent of the committed, yet un-drawn, balance that is assumed will be drawn in the case of a default is 0.358 (In percent). Calculate the bank's expected loss EAD = Ldrown+Lundrown UGD, EL=EAD LGD. PD
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