Consider yourself as a member of the asset-liability management (ALM) committee of SAR Bank Limited. Nick Carter is one of the members of the committee. He provided you the following information, based on which you are requested to write a short report (including all formulas and detailed calculation steps) to the ALM committee comparing the probability of book value insolvency of SAR Bank with a peer bank ARS. Nick also supplied following historical ratio schedule, which might be useful to measure the expected return on asset. [6 marks] Historical Ratio Schedule Year 2018 2019 2020 2021 SAR Bank ARS Bank Return on equity 15% -6% 18% 10% Equity multiplier 1.5 2 1.5 2.5 35 105 Return on equity 25% -10% -15% 5% Equity multiplier 1.25 2 1.5 2.5 25 100