1. Consider the two banks below. Compute the RoE for both banks and explain what they show. If the banks face 25% of the loans due to default, might this be a sign that the bank is taking on more risk? Why the regulators in the Central Bank prefer the high capital? Explain your answer. Bank of Sylhet Asset Liability Reserve (Required Reserve+ Deposit = 50 mil. Excess Reserve) = 5 mil. + 5 mil. Loan = 20 mil. Bank capital = 10 mil. Securities = 20 mil. Other Asset = 10 mil. Bank of Dhaka Asset Liability Reserve (Required Reserve+ Deposit = 55 mil. Excess Reserve) = 5 mil. + 5 mil. Loan = 20 mil. Securities = 20 mil. Bank capital = 5 mil. Other Asset = 10 mil