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Hello,could you please help me out, solving problems 2 and 10 on chapter 13? 6- The financial statements for THE Bank are shown below: Balance
Hello,could you please help me out, solving problems 2 and 10 on chapter 13?
6- The financial statements for THE Bank are shown below: Balance Sheet THE Bank Assets cash demand deposits fromt other Fis investments federal funds sold loans reserve for loans losses premises Total assets Income statement THE Bank interest income interest expense provision for loan losses noninterest income noninterest expense taxes $200 $600 $1,800 $900 $6,900 $500 $750 $10,650 liabilities and equity demand deposits small time deposits jumbo CDs federal funds purchased equity Total liabilities/equities $2,450 $1,630 $80 $240 $410 $40 a) calculate THE bank's earning assets earnings assets = investment +securities + net loans- loans losses earnings assets $9,100 b) Calculate THE Bank's ROA. ROA= ROA= $530.00 0.049765258 C) Calculate THE Bank's total operating income. total operatig income $2,690 0.2256055363 d) Calculate THE Bank's spread. spread 4% $ $ $ $ $ 2,450.00 4,800.00 1,425.00 1,000.00 $ 7,225.00 975.00 $10,650 8- Megalopolis Bank has the following balance sheet and income statement. Balance Sheet (in millions) Assets cash and due from banks investment securities repurchase agreements loans fixed assets other assets Total assets Liabilities and equity demand deposits NOW accounts retail CDs debentures total liabilities common stock paid-in capital retained earnings total equity total liabilities and equity $9,000 $23,000 $42,000 $90,000 $15,000 $4,000 $183,000 Income statement interest on fees and loans interest on investment securities interest on repurchase agreements interest on deposits in banks total interest income interest on deposits interest on debentures total interest expense net interest income provision for loan losses noninterest income noninterest expenses income before taxes taxes net income $9,000 $4,000 $6,000 $1,000 $20,000 $9,000 $2,000 $11,000 $9,000 $2,000 $2,000 $1,000 $8,000 $3,000 $5,000 For Megalopolis, calculate: a) return on equity 0.1785714 17.86% b) return on assets 0.0273224 2.73% c) asset utilization 12% d) equity multiplier 6.5357143 6.54 X e) profit margin 0.2272727273 f) interest expense ratio 22.73% 50% g) provision for loan loss ratio 9% h) noninterest expense ratio 5% i) tax ratio 14% $19,000 $89,000 $28,000 $19,000 $155,000 $12,000 $4,000 $12,000 $28,000 $183,000 9- Anytown bank has the following ratios: a) profit margin B) asset utilization C) equity multiplier 21% 11% 12 X calculate anytown's ROE and ROA: ROE ROA 2.3100% 0.2772 Chapter 13 2- Two depository institutions have composite CAMELS ratings of 1 or 2 and are \"well capitalized.\" Thus, each institution falls into the FDIC Risk Category I deposit insurance as Insitution 1 Tier I leverage ratio (%) loans past due 30-89 days /gross assets (%) nonperforming assets/gross assets (%) net loan charge-offs/ gross assets (%) net income before taxes/risk weighted assets (%) adjusted brokered deposits ratio (%) CAMELS components: C A M E L S Calculate the initial deposit insurance assessment for each situation institution 2 10.25 0.6 0.45 0.08 2.4 0 7 0.82 0.9 0.25 1.65 25.89 1 1 1 2 1 2 2 1 1 1 3 3 surance assessment scheme. Further, the institutions have the following financial ratios and CAMELS ratings: Chapter 13 continued 10- What is the contribution to the asset base of the following items under the Basel requirements? Under the U.S. capital-to-assets rule? a) $10 million cash reserves. b) $50 million 91-day U.S. Treasury bills. c) $5 million U.K. government bonds, AAA rated. d) $1 million general obligation municipal bonds e) $40 million repurchase agreements (against U.S treasuries) f) $500 million one-to four- family home mortgages g) $500 millions commercial and industrial loans, BBB rates. h) $100,000 performance related standby letters of credit to a blue chip corporation i) $7 million commercial letter of credit to a foreign, A rated company j) $8 million banker's acceptane conveyed to a U.S., AA rated corporation k) $17 million three-year loan commitment to a private agent l) $17 million three-month loan commitment to a private agent m) $30 million standby letter of credit to back a corporate issue of commercial paper n) $4 million five-year interest rate swap with no current exposure ( the counterparty is a private agent) o) $6 million two-year currency swap with $500,000 current exposure ( the counterparty is a private agent )Step by Step Solution
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