The risk-weight of the mortgage portfolio is 20%. Aside from the mortgage portfolio, the bank has $55,000 millions of RWA over its corporate and investment banking business unit and lesser portfolios. The bank common equity is $12 billion. The bank has issued $2 billion in eligible preferred stocks and another $1 billion in contingent convertibles. The bank has finally $5 billion in subordinated debt, half of them qualifying for capital recognition.

(b) Compute the % total capital ratio of the bank, differentiate the different tiers and appraise whether the financial institution is adequately capitalised. (15 marks