A bank has total assets of $350 million, and the risky portion of the assets consist of $100 million of home mortgages and $200 million of commercial loans. The bank has an allowance for loan & lease losses or ALL of 3 million, subordinated debt of $5 million, preferred stock of $2 million, and common stock of $20 million.

Under the new or curent (Basel III compliant) U.S. Prompt Corrective Action (PCA) rules what class of capitalization does this bank possess? Also, what is the ratio of total capital (tier1 + tier 2) to risk weighted assets (RWA).

	A.	Well capitalized; total capital ratio of 12%
	B.	Well capitalized; total capital ratio of 8.8%
	C.	Adequately capitalized; total capital ratio of 10.8%
	D.	Adequately capitalized; total capital ratio of 12%
	E.	Well capitalized; total capital ratio of 10.8%