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a. Using the following information, how much Tier 1 capital does the bank have? Bank Assets Risk Weight Bank Liabilities Cash and Treasury Securities $2,000

a. Using the following information, how much Tier 1 capital does the bank have?

Bank Assets Risk Weight Bank Liabilities
Cash and Treasury Securities $2,000 0% Deposits $8,000
Repurchase Agreements $1,000 20% Hot Money $6,000
Municipal Bonds $1,500 20% Subordinated $250
Single Family Home Mortgages $2,700 50% Common Stock $100
CMOs $2,500 50% Surplus $300
Commercial Loans $1,500 100% Retained Earnings $350
Agriculture Loans $2,100 100%
Allowance for Loan Loss $ (300) 0%
Bank Bulidings $2,000 100%
Total $15,000 $15,000

b. Based upon the information provided in a., what is the amount of risk-adjusted assets and minimum required Tier 1 capital for the bank.

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