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Suppose you have the following financial information of a bank: Assets Amount rate of return on assets Earning Assets: Securities $475 4.50% Loans $725 7.50%
- Suppose you have the following financial information of a bank:
| Assets | Amount | rate of return on assets |
| Earning Assets: | ||
| Securities | $475 | 4.50% |
| Loans | $725 | 7.50% |
| Non-earning assets | $100 | 0.00% |
| Total | $1,300 |
|
| Liabilities&Equity | Amount | rate of cost on liabilities |
| Liabilities | $1,175 | 3.00% |
| Equity | $125 | |
| Total | $1,300 |
| Industry Average |
|
| NIM | 3.54% |
What is the bank's NIM (Net interest margin)? Is the bank performing better or worse than average?
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