Question
Securities (at par) $250 Deposits $975 Loans (at par) $760 Captial $35 a) Based on the above information, how would regulators characterize this FI based
Securities (at par) $250 Deposits $975
Loans (at par) $760 Captial $35
a) Based on the above information, how would regulators characterize this FI based on the Standardized Approach leverage ratio zones of Basel III?
Hint: Is the FI well capitalized, undercapitalized ( calculate leverage ratio)
b)If problem loans reduce the market value of the loan portfolio by 25 percent, what is the value of regulatory defined (book value) capital?
c) If problem loans reduce the market value of the loan portfolio by 25 percent, what is the market value of capital?
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Restructuring And Innovation In Banking
Authors: Claudio Scardovi
1st Edition
331940203X, 978-3319402031
