Examine the balance sheet of commercial banks in the following table. Assets $ Billion % Total Liabilities and Net Worth $ Billion % Total Real assets Liabilities Equipment and premises $ 153.7 1.0 % Deposits $ 10,273.3 67.7 % Other real estate 28.9 0.2 Debt and other borrowed funds 963.0 6.3 Total real assets $ 182.6 1.2 % Federal funds and repurchase agreements 985.0 6.5 Other 912.0 6.0 Total liabilities $ 13,133.3 86.6 % Financial assets Cash $ 882.3 5.8 % Investment securities 5,032.1 33.2 Loans and leases 6,663.3 43.9 Other financial assets 1,207.2 8.0 Total financial assets $ 13,784.9 90.8 % Other assets Intangible assets $ 419.4 2.8 % Other 786.7 5.2 Total other assets $ 1,206.1 7.9 % Net worth $ 2,040.3 13.4 % Total $ 15,173.6 100.0 % $ 15,173.6 100.0 %
Examine the balance sheet of commercial banks in the following table. Assets $ Billion % Total Liabilities and Net Worth $ Billion % Total Real assets Liabilities Equipment and premises $ 153.7 1.0 % Deposits $ 10,273.3 67.7 % Other real estate 28.9 0.2 Debt and other borrowed funds 963.0 6.3 Total real assets $ 182.6 1.2 % Federal funds and repurchase agreements 985.0 6.5 Other 912.0 6.0 Total liabilities $ 13,133.3 86.6 % Financial assets Cash $ 882.3 5.8 % Investment securities 5,032.1 33.2 Loans and leases 6,663.3 43.9 Other financial assets 1,207.2 8.0 Total financial assets $ 13,784.9 90.8 % Other assets Intangible assets $ 419.4 2.8 % Other 786.7 5.2 Total other assets $ 1,206.1 7.9 % Net worth $ 2,040.3 13.4 % Total $ 15,173.6 100.0 % $ 15,173.6 100.0 %
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
Problem 1PS
Related questions
Question
Examine the
| Assets | $ Billion | % Total | Liabilities and Net Worth | $ Billion | % Total | |||||||
| Real assets | Liabilities | |||||||||||
| Equipment and premises | $ |
153.7 |
1.0 | % | Deposits | $ | 10,273.3 | 67.7 | % | |||
| Other real estate | 28.9 | 0.2 | Debt and other borrowed funds |
963.0 |
6.3 | |||||||
| Total real assets | $ | 182.6 | 1.2 | % | Federal funds and repurchase agreements | 985.0 | 6.5 | |||||
| Other | 912.0 | 6.0 | ||||||||||
| Total liabilities | $ | 13,133.3 | 86.6 | % | ||||||||
| Financial assets | ||||||||||||
| Cash | $ | 882.3 | 5.8 | % | ||||||||
| Investment securities |
5,032.1 |
33.2 |
||||||||||
| Loans and leases |
6,663.3 |
43.9 | ||||||||||
| Other financial assets |
1,207.2 |
8.0 |
||||||||||
| Total financial assets | $ | 13,784.9 | 90.8 | % | ||||||||
| Other assets | ||||||||||||
| Intangible assets | $ |
419.4 |
2.8 | % | ||||||||
| Other | 786.7 | 5.2 | ||||||||||
| Total other assets | $ |
1,206.1 |
7.9 |
% | Net worth | $ | 2,040.3 | 13.4 | % | |||
| Total | $ | 15,173.6 | 100.0 | % | $ | 15,173.6 | 100.0 | % | ||||
Balance sheet of FDIC-insured commercial banks and savings institutions
Note: Column sums may differ from total because of rounding error.
Source: Federal Deposit Insurance Corporation, www.fdic.gov, March 2016.
a. What is the ratio of real assets to total assets? (Round your answer to 4 decimal places.)
b. What is the ratio of real assets to total assets for nonfinancial firms in the following table? (Round your answer to 4 decimal places.)
| Assets | $ Billion | % Total | Liabilities and Net Worth | $ Billion | % Total | |||||||
| Real assets | Liabilities | |||||||||||
| Equipment and software | $ | 4,442 | 16.3 | % | Bonds and mortgages | $ |
5,404 |
19.9 | % | |||
| Real estate | 9,883 | 36.3 | Bank loans | 818 | 3.0 | |||||||
| Inventories |
1,774 |
6.5 | Other loans | 1,386 | 5.1 | |||||||
| Total real assets | $ | 16,099 | 59.2 | % | Trade debt | 1,786 | 6.6 | |||||
| Other | 4,688 | 17.2 | ||||||||||
| Total liabilities | $ | 14,082 | 51.8 | % | ||||||||
| Financial assets | ||||||||||||
| Deposits and cash | $ | 697 | 2.6 | % | ||||||||
| Marketable securities | 1,116 | 4.1 | ||||||||||
| Trade and consumer credit | 2,322 | 8.5 | ||||||||||
| Other | 6,959 | 25.6 | ||||||||||
| Total financial assets | $ | 11,094 | 40.8 | % | Net worth | $ | 13,111 | 48.2 | % | |||
| Total | $ | 27,193 | 100.0 | % | $ | 27,193 | 100.0 | % | ||||
Balance sheet of U.S. nonfinancial corporations
Note: Column sums may differ from total because of rounding error.
Source: Flow of Funds Accounts of the United States, Board of Governors of the Federal Reserve System, March 2016.
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