Question: 3) Determine and write down in the space provided for each of the following whether the capital item is considered as part of Tier 1

 3) Determine and write down in the space provided for each

3) Determine and write down in the space provided for each of the following whether the capital item is considered as part of Tier 1 or Tier 2 capital. Note: Problem # 3 and # 4 are not related. (5 points) ($ millions) Tier 1 or Tier 2 Equity reserves Undivided profits Equity commitment notes Surplus Subordinated debt capital instruments Minority interest in the equity accounts of consolidated subsidiaries $25 30 10 60 5 5 (b) Calculate the maximum RWA amount (in millions) that the bank would maintain to meet the minimum Tier 1 risk-based capital ratio requirements. (5 points) (c) Calculate the maximum RWA amount that the bank would maintain to meet the minimum total risk-based capital ratio requirements. (5 points)

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