The following is the book value of the assets of a bank: Asset Book Value (in millions) U.S. Treasury securities $ 50 Municipal general obligation bonds 50 Residential mortgages 400 Commercial loans 200 Total book value $700 a. Calculate the credit risk-weighted assets using the following information: Asset Risk Weight U.S. Treasury securities 0% Municipal general obligation bonds 20 Residential mortgages 50 Commercial loans 100 b. What is the minimum core capital requirement? What is the minimum total capital requirement?
The following is the book value of the assets of a bank: Asset Book Value (in millions) U.S. Treasury securities $ 50 Municipal general obligation bonds 50 Residential mortgages 400 Commercial loans 200 Total book value $700 a. Calculate the credit risk-weighted assets using the following information: Asset Risk Weight U.S. Treasury securities 0% Municipal general obligation bonds 20 Residential mortgages 50 Commercial loans 100 b. What is the minimum core capital requirement? What is the minimum total capital requirement?
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
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The following is the book value of the assets of a bank:
|
Asset |
Book Value (in millions) |
|
U.S. Treasury securities |
$ 50 |
|
Municipal general obligation bonds |
50 |
|
Residential mortgages |
400 |
|
Commercial loans |
200 |
|
Total book value |
$700 |
a. Calculate the credit risk-weighted assets using the following information:
|
Asset |
Risk Weight |
|
U.S. Treasury securities |
0% |
|
Municipal general obligation bonds |
20 |
|
Residential mortgages |
50 |
|
Commercial loans |
100 |
b. What is the minimum core capital requirement?
What is the minimum total capital requirement?
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