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Please answer the attached question in the attached image about tier one bank ratio and other ratio 3. Consider the following balanoe sheet of Assume

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Please answer the attached question in the attached image about tier one bank ratio and other ratio

image text in transcribed
3. Consider the following balanoe sheet of" Assume that the bank does not have off balance sheet commitments. Assets Liabilities and Equities m Treasury Securities 10 10 year subordinate Debts 16 Commercial Loan [33+] 15 Perpetual noncumulative 1 Preferred shares Single Family Mortgages 40 Common stock 2 Consumer Loans 35 Retained Earnings 4 Commercial Loans [CCC+] 24- Total Liabilities and Equities 5 134 Allowance for Loan Losses [$ 10] Physical Assets $15 Total Assets $134 Risk Weight of Asses Assets Risk Weight Cash and Reserves (1% Treasury Securities (1% 2 Commercial Loan (133+) 100% Single Family Mortgages 50% Consumer Loans 100% Commercial Loans (CCC+) 150% Ph sical Assets 100% Tier 1 vs. Tier 2 capital 10 Ear subordinate Debts Tier 2 Perpetual noncumulative Preferred shares Tier 1 Common stock Tier 1 Retained Earnings Tier 1 Reserve for Loan Loss es Tier 2 Using the information given about risk weights and capital categories, calculate the following three capital adequacy ratios [leverage ratio, tier 1 capital ratio and total risk based capital ratio]

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