Question 1 (40 marks) The following is AXXA Bank Balance Sheet: Liabilities and Equities (RM million) Deposits 88 Asset (RM million) Securities 30 Reserves X1 Loans X2 Others X3 Total 100 Stockholder's Equities X4 Total 100 Assume that the bank keeps no excess reserves and that required reserves (X1) equal five percent of total deposits. The bank also lends 55 percent of its total sources of funds. Based on the above information, calculate X1, X2, X3 and X4. Show your workings in the answer sheets. (10 marks) (b) Assuming that AXXA Bank's reserves and other assets, generate no income. Securities earn a return of 7 percent, while loan earns 10 percent. The bank's deposit cost is 6 percent, Provision of loan losses is 1 percent of total loans, non- interest income is 0.1 percent of total assets, while non-interest expenses equals 0.2 percent of total deposits. The bank's tax rate is 25 percent and its dividend payout ratio are 40 percent. The bank has no gains or losses from securities or other transactions. From this information, calculate the following: (1) Interest income Interest expenses Net interest income (iv) Provision for loan losses (PLL) (v) Net interest income after PLL (vi) Non-interest income (vii) Non-interest expenses (viii) Net non-interest income (expenses) (ix) Pre-tax income Taxes (xi) Net income (xii) Dividends (xiii) Retained earnings (xiv) ROA (xv) ROE (2 marks each; 15 x 2 marks = 30 marks) D