The Big Apple Bank has the following common size income statement where each item is as a % of total average assets (from its Uniform Bank Performance Report) Earnings and Profitability Analysis (% Ave. Total Assets)

2016 2015

Total Interest Income (IR%) 3.69 3.25

Total Interest Expense(IE%) 0.40 0.35

Net Interest Income (NIM) 3.29 2.90

Total Non-interest Revenues (NIR%)1.34 1.50

Total Non-Interest Expense (NIE%) 2.74 2.50

Burden % 1.40 1.00

Provision for Loan Losses (PLL%) 0.17 0.60

Pretax Operating Income (OROA%) 1.72% 1.30%

Equity to Assets 10.01% 8.00%

b. Given the change in NIM with a rise in rates in 2016, what type of funding gap did the bank likely have?

c. What was the banks asset utilization each year? (Hint AU = IR% + NIR%)

d. Given the OROA & AU, what was the NPM each year for the bank? (NPM=OROA/AU (as a fraction))

e. What were the OROEs each year? (Hint OROE = OROA x EM or OROA/ Equity to assets as a fraction)