A Bank has AMD 50B in capital and 100B in deposits (out of which half is in USD) with the average rate of 5%. It has 6B in Central Bank reserves. The Bank keeps equivalent of AMD 14B (out of which 4B is in AMD and 10B is in USD) on its nostro accounts paying 1% interest. The Bank should keep at least AMD 1B and equivalent of AMD 1B on its AMD and USD nostro accounts in order to organize operations. There is AMD 10B in securities (available for sale) paying 6% on average and equivalent of AMD 110B (out of which half is disbursed in USD) in loans paying 12%. The rest of the assets are in property used for banking activities. The Bank doesnt need to keep anything in excess of required reserve with the CB. The exchange rate is AMD 500 = 1USD. 1 Create the initial balance sheet of the bank. 2 Calculate if the Bank is compliant with the Central Bank reservation requirement. The required reservation rate is 14% for foreign currency denominated resources and 2% for AMD denominated resources. 3 Calculate the Net Interest Margin. 4 Now suppose that 20% of AMD deposits were called back by the depositors. Please show the the changes on the balance sheet and calculate the new NIM. 5 Indicate if the bank was compliant with the regulatory asset liquidity requirements before and after the outflow. (Highly liquid assets expressed in all currencies / Total assets expressed in all currencies >15 %). 6 Calculate the FX position and indicate its direction before and after the deposit outflow. 7 If after the deposit outflow the exchange rate changes to AMD 550 = 1USD how much would the revaluation gain or loss be for the bank.