The bank has the following balance sheet:

$\backslash$table$[[$Total Assets,$200,$Total Liabilities,$200],[$Loans$,100,$Deposits,$160],[$Securities$,100,$Equity,$20],[,,$Junior debt,$10],[,,$Senior debt,$10]]$

$2\mathrm{.}1.$ A loan commitment of $x$ is exercised and financed only through the sale of securities $($at $50\%$ of the face value$).$ What is the size of $x$ above which it becomes necessary to start converting senior debt into equity to replenish capital to the level of $20?$

$2\mathrm{.}2.$ Consider again the initial balance sheet. What is the maximum amount of loan commitments that can be exercised so that the bank can still have equity equal to $20$ without

$1$

raising any external capital? Assume that loan commitments are still financed by selling securities at $50\%$ of the face value and that deposits cannot be used for recapitalizing the bank.