The financial crisis compelled banks to reduce their leverage sharply. Consider the following two views of the balance sheet of a bank before and after the financial crisis.

Bank Balance Sheet: View 1 (in millions)			Bank Balance Sheet: View 2 (in millions)
Assets	Liabilities and Capital		Assets	Liabilities and Capital
Reserves $30	Deposits $800		Reserves $30	Deposits $200
Loans $820	Other borrowed funds $90		Loans $820	Other borrowed funds $110
Securities $150	Bank capital $110		Securities $150	Bank capital $90

Calculate the leverage ratios for each view.

Instructions: Enter your responses rounded to two decimal places.

View 1: Leverage ratio =

View 2: Leverage ratio =

Which balance sheet view is more likely to be that of the bank after the financial crisis?

multiple choice

View 2

View 1