2. The following balance sheet assets for a bank are available (in actual dollars)

Assets

Cash $ 5,000,000

Deposits at domestic banks 2,000,000

Municipal securities 10,000,000

Foreign Government securities 3,000,000

Consumer loans outstanding 20,000,000

Commercial loans outstanding 50,000,000

Total assets (on balance-sheet) $ 90,000,000

Off-balance sheet Assets:

Short-term unused loan commitments to

Individuals 5,000,000

Long-term unused loan commitments to

Private corporations 30,000,000

1. The Tier I capital is $4,400,000 and Tier II capital is $4,400,000.

1. Calculate Tier I capital ratio to RWA. (2 points)
2. Calculate total capital ratio to RWA. (2 points)
3. Based upon the five capital adequacy categories (PCA), answer the following based on Basel regulatory requirement:

Tier I capital ratio is __________ (1 point)

Total capital ratio is __________ (1 point)