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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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