Question No. 5: Using the following information for New River National Bank, calculate that bank's ratios...

 

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Question No. 5: Using the following information for New River National Bank, calculate that bank's ratios of Tier I-capital-to-risk-weighted assets and total -capital-to-risk-weighted assets under the terms of the Basel I agreement. Does the bank have sufficient capital? 1. On-balance-sheet items (Assets) Loans to corporations U.S. treasury securities Deposits due from banks Secured loans Cash Answer: * * Amounts $ 150,000 70,000 60,000 140,000 20,000 Off-balance-sheet items Long-term unused commitments * * SLCs Total off-balance-sheet item Tier I capital Tier II capital Amounts $ 170,000 160,000 350,000 11,000 10,000 Question No. 5: Using the following information for New River National Bank, calculate that bank's ratios of Tier I-capital-to-risk-weighted assets and total -capital-to-risk-weighted assets under the terms of the Basel I agreement. Does the bank have sufficient capital? 1. On-balance-sheet items (Assets) Loans to corporations U.S. treasury securities Deposits due from banks Secured loans Cash Answer: * * Amounts $ 150,000 70,000 60,000 140,000 20,000 Off-balance-sheet items Long-term unused commitments * * SLCs Total off-balance-sheet item Tier I capital Tier II capital Amounts $ 170,000 160,000 350,000 11,000 10,000

Answer rating: 100% (QA)

Capitaltoriskweighted assets as per Basel I Capital Adequacy Ratio CAR Tier I Cap... View the full answer