Onshore Bank has $35 million in assets, with risk-adjusted assets of $25 million.
Onshore Bank has $35 million in assets, with risk-adjusted assets of $25 million. Core Equity Tier 1 (CET1) capital is $1,200,000, additional Tier I capital is $420,000, and Tier II capital is $430,000. The current value of the CET1 ratio is 4.8 percent, the Tier I ratio is 6.48 percent, and the total capital ratio is 8.2 percent.
Calculate the new value of CET1, Tier I, and total capital ratios for the following transactions:
a. The bank issues $3.5 million of CDs and uses the proceeds to issue category 1 mortgage loans with a loan-to-value ratio of 70 percent.
Save your time - order a paper!
Get your paper written from scratch within the tight deadline. Our service is a reliable solution to all your troubles. Place an order on any task and we will take care of it. You won’t have to worry about the quality and deadlines
Order Paper Now