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Stanbo bank has a credit portfolio of R8bn with an average portfolio PD of 1.2%. The net income or margin is 2.7%. If the portfolio
Stanbo bank has a credit portfolio of R8bn with an average portfolio PD of 1.2%. The net income or margin is 2.7%. If the portfolio collapses, about 40% of recovery can happen. Therefore, the maximum loss would be R3.2bn (40% x 8bn). Hence, roughly the outcome shows a gain of R216m versus a loss of R3.2bn. Stanbo bank maintains 10% capital adequacy ratio and the portfolio exposure (RWA) is R8bn.
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Income Tax Fundamentals 2013
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill
31st Edition
1111972516, 978-1285586618, 1285586611, 978-1285613109, 978-1111972516
