Problem $2.$ Assume you are manager at a banking institution and you estimate the bank has liquidity deficit of $$125$ million over the planning period.

The bank has $$560$ million in liquid assets and a $$750$ million commercial loan portfolio.

a$.$ What is the bank's current volume of volatile sources of funds?

b$.$ Bank management wants to re$-$estimate its potential liquidity position under the assumption that commercial loans must increase by $3\%$ to meet the demands of good customers. What is the estimated liquidity surplus$/$deficit under this assumption?