Transaction 1: Opening a bank named M&B National (All figures below are in Smi. The initial stock offering of the bank is $160 mi. The stock is purchased using liquid cash assets which are immediately used for property purposes (i.e, land, buildings, ATM facilities, and other equipment). M&B Bank- Balance Sheet Assets Liabilities and Net Worth Property Net Worth Total Total Transaction 2: Customers deposit $160 mi. in funds in the form of Demand Deposits M&B Bank-Balance Sheet Assets Liabilities and Net Worth Property Cash Net Worth Demand Deposits Total Total Transaction 3: Bank Loans Bank issues the maximum funds for loans to its customers. Assume reserve requirements are 25% of deposits and all loan proceeds are deposited with the bank. A bank can hold reserves in two ways: 1. 2. M&B Bank-Balance Sheet Assets Liabilities and Net Worth Net Worth Property Reserves Loans @(fixed 8% rate) Demand Deposits-Existing Demand Deposits-From loans Total Demand Deposits Total Total What is the bank's ROA? What is the Bank's ROE? If the bank's customers withdraw $200 mi in deposits, what would be the reserve position of M&B after the transaction? Is the bank deficient in reserves? Is so, by how much