Question
Friendly Financial has $150 million in consumer loans with an average interest rate of 13 percent. The bank also has $102 million in home equity
Friendly Financial has $150 million in consumer loans with an average interest rate of 13 percent. The bank also has $102 million in home equity loans with an average interest rate of 10 percent. Finally, the company owns $28 million in corporate securities with an average rate of 8 percent.
Managers at Friendly Financial estimate that next year its consumer loan portfolio will rise to $271 million and the interest rate will fall to 11 percent. They also estimate that its home equity loans will fall to $90 million with an average interest rate of 10 percent, and its corporate securities portfolio will increase to $29 million with an average rate of 8 percent.
Required:
Estimate Friendly Financials revenues for the coming year. (Enter your answer in thousands of dollars.)
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