Question
Please show work Lathrop Bank and Trust Co. has calculated its daily average deposits and vault cash holdings for the most recent two-week computation period
Please show work
Lathrop Bank and Trust Co. has calculated its daily average deposits and vault cash holdings for the most recent two-week computation period as follows:
Net transaction deposits = $ 85,500,380 Nonpersonal time deposits under 18 months to maturity = $ 171,483,005 Eurocurrency liabilities = $ 7,213,406 Daily average balance in vault cash = $ 1,894,026
Suppose the reserve requirements posted by the Board of Governors of the Federal Reserve System are as follows:
Net transaction accounts: $10.5 to $57.6 million 3% More than $57.6 million 10% Nonpersonal time deposits: Less than 18 months 3% 18 months or more 0% Eurocurrency liabilities-all types 3%
a. What is this savings bank's total required level of legal reserves?
b. How much must the bank hold on a daily average basis with the Federal Reserve bank in its district?
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started