Consider the balance sheet for the DI listed below Assets Cash Securities Loans Total assets Liabilities and equity $5 Deposits 20 Equity 50 Total liabilities and equity $75 $68 7 b) The stored liquidity management is used to meet the liquidity shortfall. $75 The DI is expecting a $15 million net deposit drain. Show the DI's balance sheet under these two conditions: a) The DI purchases liabilities to offset this expected drain. c) Bank D.U reported a debt to equity ratio of 11 at the end of year 2022. If the 'bank's total assets at the end of year 2022 was $34 million, how much of its assets were financed with equity? d) If the Swiss Franc to U.S. Dollar is expected to appreciate in the near future, would a U.S. bank in Basel, Switzerland, prefer to be net long or net short in its asset positions? Please also explain the reasons.

Consider the balance sheet for the DI listed below Assets Cash Securities Loans Total assets Liabilities and equity $5 Deposits 20 Equity 50 Total liabilities and equity $75 $68 7 b) The stored liquidity management is used to meet the liquidity shortfall. $75 The DI is expecting a $15 million net deposit drain. Show the DI's balance sheet under these two conditions: a) The DI purchases liabilities to offset this expected drain. c) Bank D.U reported a debt to equity ratio of 11 at the end of year 2022. If the 'bank's total assets at the end of year 2022 was $34 million, how much of its assets were financed with equity? d) If the Swiss Franc to U.S. Dollar is expected to appreciate in the near future, would a U.S. bank in Basel, Switzerland, prefer to be net long or net short in its asset positions? Please also explain the reasons.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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