Consider the balance sheets of the following two (fictitious) banks:

Lion Bank

Assets ($m) Liabilities ($m)

Loans80 Deposits90

Reserves20 Capital10

Total100 Total100

Goose Bank

Assets ($m) Liabilities ($m)

Loans95 Deposits80

Reserves5 Capital20

Total100 Total100

Suppose that, as a result of adverse economic conditions, both of these banks experience loan losses of $10m and deposit outflows of $8m. Discuss the main risks facing each bank and the corrective actions they might need to take in this situation.