Question
Assets Liabilities Cash $100 Deposits $500 U.S. Treasury Bills $850 Borrowings $200 Loans $50 Equity Capital $300 Total Assets $1000 Total Liabilities and Equity $1000
| Assets | Liabilities |
| Cash $100 | Deposits $500 |
| U.S. Treasury Bills $850 | Borrowings $200 |
| Loans $50 | Equity |
|
| Capital $300 |
|
|
|
| Total Assets $1000 | Total Liabilities and Equity $1000 |
a.) Suppose that this bank wanted to increase its Net Interest Margin (NIM). What advice would you give to the bank?
b.) Suppose that this bank wanted to increase its ROE (Return on Equity) without changing its Net Interest Margin. What advice would you give to the bank?
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Small Fund Management
Authors: K. K.
1st Edition
979-8866391837
