Cash and T-Bonds Agency bonds (GNMA) Mortgages Loans (AAA rated) Total Cash and T-Bonds Agency bonds (GNMA) Mortgages Loans (AAA rated) Total Bank A (in $ millions) Assets Basel Weights Risk-Adjusted Assets 800.00 500.00 1,000.00 1,200.00 0% 20% 3,500.00 Bank B (in $ millions) Assets Basel Weights Risk-Adjusted Assets 500.00 800.00 1,200.00 1,000.00 3,500.00 Demand deposits Time Deposits 0% 50% 150% 11. Using information from Question 10, if both banks have the same liabilities as shown below are they in compliance with Basel I standards? Bank A and B Liabilities and Stockholder's equity (in 5 millions) Subordinated Debt (Tier 2) Preferred Stock (Tier 2) Common Stock (Tier 1) Retained Earnings (Tier 1) 1,000.00 1,500.00 85.00 25.00 35.00

11. Using information from Question 10, if both banks have the same liabilities as shown belov are they in compliance with Basel I standands