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Oldhat Financial starts its first day of operations with $9 million in capital. A total of $130 million in chequable deposits is received. The bank
Oldhat Financial starts its first day of operations with $9 million in capital. A total of $130 million in chequable deposits is received. The bank makes a $25 million commercial loan and another $50 million in residential mortgages. Other cash available is held as reserve.
a). What does the bank balance sheet look like?
b). Calculate the risk-weighted capital ratio after Oldhats first day.
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