Fifth Bank has the following asset portfolio on its balance sheet (and zero off-balance-sheet business). ASSETS...
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Fifth Bank has the following asset portfolio on its balance sheet (and zero off-balance-sheet business). ASSETS Cash $50 Municipal Bonds $100 Residential Mortgages $250 Commercial Loans $500 $100 $1,000 Junk Bonds Total Assets VALUE ($million) In addition to the credit-risk-weighted assets, the bank also has $100 million in market-risk-weighted assets, and $45 million in operational-risk-weighted assets. Select one: Assuming the capital conservation buffer is 2.5% and the counter-cyclical buffer is 0.5%, what is the minimum dollar amount of Tier 1 capital that Fifth Bank is required to hold to meet the Basel III capital adequacy standards? a. 91.6 million CREDIT RISK WEIGHT 0% 20% 35% 100% 150% O b. 99.28 million O c. 81.23 million d. 67.69 million Fifth Bank has the following asset portfolio on its balance sheet (and zero off-balance-sheet business). ASSETS Cash $50 Municipal Bonds $100 Residential Mortgages $250 Commercial Loans $500 $100 $1,000 Junk Bonds Total Assets VALUE ($million) In addition to the credit-risk-weighted assets, the bank also has $100 million in market-risk-weighted assets, and $45 million in operational-risk-weighted assets. Select one: Assuming the capital conservation buffer is 2.5% and the counter-cyclical buffer is 0.5%, what is the minimum dollar amount of Tier 1 capital that Fifth Bank is required to hold to meet the Basel III capital adequacy standards? a. 91.6 million CREDIT RISK WEIGHT 0% 20% 35% 100% 150% O b. 99.28 million O c. 81.23 million d. 67.69 million
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Financial Institutions Management A Risk Management Approach
ISBN: 978-0071051590
8th edition
Authors: Marcia Cornett, Patricia McGraw, Anthony Saunders
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