Question
Lawrence State Bank has Tier 1 capital to risk weighted assets of 7.75%,total capital (Tier 1 &2)to risk weighted assets of 9.75%, common equity to
Lawrence State Bank has Tier 1 capital to risk weighted assets of 7.75%,total capital (Tier 1 &2)to risk weighted assets of 9.75%, common equity to risk weighted asets of 6.45%, and a Tier 1 capitalto total assets ratio of 4.95%.What type of bank is this under the new or updated (Basel III compliant) U.S.Prompt Corrective Action (PCA)standards?
PCA Category Total Tier 1 CET1 Tier 1 RBC RBC RBC Leverage Ratio Ratio Ratio Ratio Well Capitalized 10% 8% 6.5% 5% Adequately 8% 6% 4.5% 4% Capitalized Undercapitalized
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Introduction to Finance Markets Investments and Financial Management
Authors: Melicher Ronald, Norton Edgar
15th edition
9781118800720, 1118492676, 1118800729, 978-1118492673
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