On 1/1/2020, Treadwater bank has loans of $100 million, deposits of $40 million, an Allowance for Loan Losses (ALL) balance of $20 million, and a net interest margin of $10 million. Assume deposits are the only liabilities of the bank.

Please remember to show all calculations.

A. What is the value of Treadwater's Bank Capital (Net Worth) on 1/1/2020? (3 Points)

B. What is Treadwater's ROE on 1/1/2020? (3 Points)

Now by 12/31/2020, Treadwater had to write off $5 million of its loans:

C. Show why Treadwater's bank capital has or has not changed between 1/1/2020 and 12/31/2020. (1 Points)

D. Calculate the ROE on 12/31/2020 (1 Points)

By 12/31/2021, Treadwater's loans now total $195, the ALL is $15 million, and deposits are now $80 million. During the year its Provision for Loan Losses were $20 million and its net interest margin increased to $40 million.

F. Calculate the bank's ROE on 12/31/21? (4 Points)

H. Is the bank in a better or worse financial position by 12/31/21 compared to 12/31/20? Why or why not? (3 Points)