Correct option? ? General Accounting A regional bank has total assets of $250 million andequity capital of $20 million. If the bank's return onassets (ROA) is 0.8%, calculate the bank's return onequity (ROE).a. 8%b. 10%c. 12.5%d. 15%

Step 1: Define Return on Equity (ROE)Return on Equity (ROE) measures a company's profitability in…

Answered: A regional bank has total assets of…

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

ChapterM: Time Value Of Money Module

Section: Chapter Questions

Problem 2MC

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Consider a bank with the following balance sheet Assets Liabilities Required reserves Excess reserves T-bills Commercial loans $ 9 million Checkable deposits $ million Bank capital $ 44 million $ 52 million $ 100 million $ 10 million The bank makes a loan commitment for $15 million to a commercial customer. Before the commitment, the bank's capital ratio equals%. (Round your response to two decimal places.)
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Question 3: Refer to the exhibit. If Bank QRS's assets rise by 3 percent and its liabilities rise by 2 percent, by what percentage would its bank capital change compared to its original bank capital (i.e., the value originally in blank (B))? Balance Sheet Bank QRS ($ millions) Assets Reserves (A) Loans 200 Liabilities Checkable Deposits $ 150 O a. 5.7 percent O b. 5.0 percent O c. 1.0 percent O d. 6.2 percent Nontransaction Deposits 50 Securities 60 Borrowings Total Assets $284.5 Bank Capital 6 (B)
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Assume a bank has $200 million of assets with a duration of 2.5 and $190 million of liabilities.....
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A bank has $770 million in checkable deposits. The bank has $85 million in reserves. If the reserve requirement is 10%, the bank's required reserves are _____________ and its excess reserves are _____________. A. $85 million; $0 B. $770 million; $85 million C. $89 million; $21 million D. $77 million; $8 million
Compute the weighted-average marginal cost of funds for XYZ Bank Limited.B. Explain why it is important to use the marginal cost of funds as opposed to average cost of funds in making loan pricing decisions.
You observe the following details about a bank (amounts in million) net interest income: $1,250 net noninterest income: $200 operating expenses: $900 loan loss provisions: $170 gains from trading: $75 Taxes: $150 Total assets: $17,000 Equity: $2,200 What is the bank's ROE? Write your answer expressed as a %, and round to two decimals. For instance, if you think the ROE is 0.0856237, then you write 8.56 below
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A regional bank has total assets of $250 million and equity capital of $20 million. If the bank's return on assets (ROA) is 0.8%, calculate the bank's return on equity (ROE). a. 8% b. 10% c. 12.5% d. 15%