4. Oldhat Financial started its first day of operations with $9 million in capital. $130 million in checkable deposits are received. The bank issues a $25 million commercial loan and another $50 million in mortgages. With the following terms:

• Mortgages: 200 standard 30-year, fixed-rate with a nominal annual rate of 5.25% each for $250,000

• Commercial loan: Three-year loan, simple interest paid monthly at 0.75% per month.

1. If required reserves are 8%, what does the bank balance sheet look like? Ignore any loan loss reserves.

2. How well capitalized is the bank?

3. Calculate the risk-weighted assets and risk-weighted capital ratio after Oldhats first day