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Based on the following information about Banks A and B, compute for each the return on assets (ROA), return on equity (ROE), and leverage ratio.
Based on the following information about Banks A and B, compute for each the return on assets (ROA), return on equity (ROE), and leverage ratio. a. Bank A has net profit after taxes of $2 million and the following balance sheet: Assets Bank Balance Sheet (in millions) Liabilities and Capital $10 Deposits $90 $75 Borrowings $15 $35 Bank Capital $15 Reserves Loans Securities Instructions: Enter your responses rounded to two decimal places. The return on assets (ROA) for Bank A: percent The return on equity (ROE) for Bank A: percent The leverage ratio for Bank A: b. Bank B has net profit after taxes of $1.5 million and the following balance sheet: Assets Reserves Loans Securities Bank Balance Sheet (in millions) Liabilities and Capital $10 Deposits $65 $55 Borrowings $10 $30 Bank Capital $20 Instructions: Enter your responses rounded to two decimal places. The return on assets (ROA) for Bank B: percent The return on equity (ROE) for Bank B: percent The leverage ratio for Bank B
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