Suppose that Bank of Najah has the following info:

Checkable deposits $500 million.

Borrowed funds from the Central Bank $20 million.

Reserves $115 million.

Commercial loans $210 million.

Mortgage loans $120 million.

Consumer loans $65 million

Government Securities $35 million.

Assuming that the required reserves ratio is 12%

1. Write down the banks balance sheet.
2. Calculate its capital asset ratio. Comment on the result.
3. Does the bank meet Basel requirements?
4. The bank is considering buying Government securities, how much could it buy given the state ( ) of the balance sheet?
5. Suppose the bank sells half the amount of its Gov. securities to the Central bank for $18 million, and made a new consumer loan of $5 million:
   1. Show what happens to the banks balance sheet.
   2. Show what happens to the banks capital.
   3. In the simple model what would happen to the money supply.

      Suppose that Bank of Najah has the following info:

      Checkable deposits $500 million.

      Borrowed funds from the Central Bank $20 million.

      Reserves $115 million.

      Commercial loans $210 million.

      Mortgage loans $120 million.

      Consumer loans $65 million

      Government Securities $35 million.

      Assuming that the required reserves ratio is 12%

   4. Write down the banks balance sheet.
   5. Calculate its capital asset ratio. Comment on the result.
   6. Does the bank meet Basel requirements?
   7. The bank is considering buying Government securities, how much could it buy given the state ( ) of the balance sheet?
   8. Suppose the bank sells half the amount of its Gov. securities to the Central bank for $18 million, and made a new consumer loan of $5 million:
      1. Show what happens to the banks balance sheet.
      2. Show what happens to the banks capital.
   9. 3. In the simple model what would happen to the money supply.