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Imagine a bank with the assets below ( with respective risk weights ) and subject to a traditional capital requirement. Banking regulation requires the bank's
Imagine a bank with the assets below with respective risk weights and subject to a traditional capital requirement. Banking regulation requires the bank's capital ratio to be at least
List of Assets in the Bank's Balance Sheet
Cash and Reserves, Value $ Risk Weight
Mortgage Loans Value $ M Risk Weight
Mortgage Loans Value $ M Risk Weight
C&I Loans, Value $ M Risk Weight
Consumer Loans, Value $ Risk Weight
Calculate the minimum amount of equity capital in dollars that the bank needs to have to satisfy the capital requirement.
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