2. The credit risk exposure of the bank is another issue that needs attention. Unibank obtained the following data regarding the national average exposure of all banks and one competitor bank that serves the same target markets as Unibank: Sectors National UniBank Competitor Bank average of all banks 50% 30% 10% 10% Small business 25% Consumer loans Housing loans 30% Corporate loans UniBank would like to estimate how much its loan portfolio deviate from the national average compared to the portfolio of the competitor bank. You are requested to calculate how much the loan portfolios of UniBank and the competitor bank deviate from the national average and to explain whether the deviation of UniBank is better or worse than the deviation of the competitor bank by providing reasons for it. 10% 20% 0% 20% 60% 35%

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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2. The credit risk exposure of the bank is another
issue that needs attention. Unibank obtained the
following data regarding the national average
exposure of all banks and one competitor bank
that serves the same target markets as Unibank:
Sectors
National UniBank
average
of all
banks
Competitor
Bank
Small business 25%
Consumer
loans
Housing loans 30%
Corporate
loans
UniBank would like to estimate how much its loan
portfolio deviate from the national average
compared to the portfolio of the competitor
bank. You are requested to calculate how much
the loan portfolios of UniBank and the competitor
bank deviate from the national average and to
explain whether the deviation of UniBank is
better or worse than the deviation of the
competitor bank by providing reasons for it.
50%
30%
10%
10%
10%
20%
0%
20%
60%
35%
Transcribed Image Text:2. The credit risk exposure of the bank is another issue that needs attention. Unibank obtained the following data regarding the national average exposure of all banks and one competitor bank that serves the same target markets as Unibank: Sectors National UniBank average of all banks Competitor Bank Small business 25% Consumer loans Housing loans 30% Corporate loans UniBank would like to estimate how much its loan portfolio deviate from the national average compared to the portfolio of the competitor bank. You are requested to calculate how much the loan portfolios of UniBank and the competitor bank deviate from the national average and to explain whether the deviation of UniBank is better or worse than the deviation of the competitor bank by providing reasons for it. 50% 30% 10% 10% 10% 20% 0% 20% 60% 35%
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