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Need answers for E and F Return to question 9 Onshore Bank has $35 million in assets, with risk-adjusted assets of $25 million. Core Equity
Need answers for E and F
Return to question 9 Onshore Bank has $35 million in assets, with risk-adjusted assets of $25 million. Core Equity Tier 1 (CET1) capital is $1,200,000, additional Tier I capital is $420,000, and Tier II capital is $430,000. The current value of the CET1 ratio is 4.8 percent, the Tier I ratio is 6.48 percent, and the total capital ratio is 8.2 percent. 02:27:14 Calculate the new value of CET1, Tier I, and total capital ratios for the following transactions. a. The bank repurchases $115,000 of common stock with cash. b. The bank issues $3.5 million of CDs and uses the proceeds to issue category 1 mortgage loans with a loan-to-value ratio of 70 percent c. The bank receives $515,000 in deposits and invests them in T-bills. d. The bank issues $815,000 in common stock and lends it to help finance a new shopping mall. The developer has an A+ credit rating. e. The bank issues $2.5 million in nonqualifying perpetual preferred stock and purchases general obligation municipal bonds. f. Homeowners pay back $5.5 million of mortgages with loan-to-value ratios of 50 percent and the bank uses the proceeds to build new ATMs
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