Compute the Leverage (Tier 1) capital ratio in % using the following balance sheet. Assets Liabilities...
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Compute the Leverage (Tier 1) capital ratio in % using the following balance sheet. Assets Liabilities & Equity Amount Risk weight Cash 10 0% Deposits 1000 Treasury securities 150 0% Subordinated Debt 330 Mortgage Backed Securities 150 150% Perpetual Preferred Stock 30 Tier I Commercial Loans 200 100% Common Stock 20 CET1 Residential RE Loans 400 50% Retained Earnings 20 Consumer Loans 500 100% Allowance for loan losses (10) TOTAL 1400 1400 Tier 2 capital limits (maximum): Allowance for loan losses: Subordinated debt: 1.25% of risk-weighted assets 50% of Tier I capital 5.5 3.5 5 4 4.5 Compute the Leverage (Tier 1) capital ratio in % using the following balance sheet. Assets Liabilities & Equity Amount Risk weight Cash 10 0% Deposits 1000 Treasury securities 150 0% Subordinated Debt 330 Mortgage Backed Securities 150 150% Perpetual Preferred Stock 30 Tier I Commercial Loans 200 100% Common Stock 20 CET1 Residential RE Loans 400 50% Retained Earnings 20 Consumer Loans 500 100% Allowance for loan losses (10) TOTAL 1400 1400 Tier 2 capital limits (maximum): Allowance for loan losses: Subordinated debt: 1.25% of risk-weighted assets 50% of Tier I capital 5.5 3.5 5 4 4.5
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