A bank has estimated its net income for 2020 is $2,000,000. It has also estimated the following ratios of its capital: CET1 = 7% Tier 1= 7.50% Tier 1+2= 9% Under Basel 2, what is the maximum, it can pay out in dividends? a $0.00 b $400,000.00 c $800,000.00 d $1,200,000.00

A bank has estimated its net income for 2020 is $2,000,000. It has also estimated the following ratios of its capital: CET1 = 7% Tier 1= 7.50% Tier 1+2= 9% Under Basel 2, what is the maximum, it can pay out in dividends? a $0.00 b $400,000.00 c $800,000.00 d $1,200,000.00

International Financial Management

14th Edition

ISBN:9780357130698

Author:Madura

Publisher:Madura

Chapter12: Managing Economic Exposure And Translation Exposure

Section: Chapter Questions

Problem 3BIC

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Question

A bank has estimated its net income for 2020 is $2,000,000. It has also estimated the following ratios of its capital:

CET1 =                  7%
Tier 1=                  7.50%
Tier 1+2=             9%

Under Basel 2, what is the maximum, it can pay out in dividends?

	a	$0.00
	b	$400,000.00
	c	$800,000.00
	d	$1,200,000.00

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