Suppose that the assets of a bank consists of $100 million of loans to A rated corporations.

Fantastic news! We've Found the answer you've been seeking!

Question:

Suppose that the assets of a bank consists of $100 million of loans to A rated corporations. The PD for the corporations is estimated as 0,1% and LGD is 60%. The average maturity is 2.5 years for corporate loans. What is RWA?

Related Book For answer-question

Risk Management and Financial Institutions

ISBN: 978-1118955949

4th edition

Authors: Hull John

See More Books

Posted Date: Feb 24, 2024 01:19 AM

See More Questions

Suppose that the assets of a bank consist of $500 million of loans to BBB-rated corporations. The PD for the corporations is estimated as 0.3%. The average maturity is three years and the LGD is 60%....
Suppose the assets of a bank consist of $500 million of loans to BBB-rated corporations. The PD for the corporations is estimated as 0.3%. The average maturity is three years and the LGD is 60%. a....
Suppose that the assets of a bank consists of $100 million of loans to corporations rated A, $10 million of government bonds rated AAA, and $50 million of residential mortgages. What is RWA?
The fieldwork for the 30 June 20X0 audit of Tracy Brewing Company Ltd was finished on 19 August 20X0 and the completed financial statements, accompanied by the signed audit reports, were mailed on 6...
A subsidiary of Corporation A, an electrical utility located in Springfield, and a subsidiary of Corporation B, a diversified manufacturer also located in Springfield, formed a joint venture under...
Otero Fibers, Inc., specializes in the manufacture of synthetic fibers that the company uses in many products such as blankets, coats, and uniforms for police and firefighters. Otero has been in...
Construct a bar graph for each of the following (assume the independent variable is Group and the dependent variable is time): a. $\operatorname{Group} \mathrm{A}(N=21, M=14.05, s=3.63)$; Group B...
Following is a traditional income statement for Mouse Max, a company that manufactures cordless mice for computers. Revenue ................................... $2,500,000 Cost of goods sold...
(a) Use the method of integrating factor to solve the equation below for y: dy dx +ycotx cos x given that when x,y=2 (b) In the circuit below, switch S is closed at 7=0, and the current at that time...
Le Roi du Plastique Sarl has two processes extrusion and thermo-assembly. Consider the June 2022 data for physical units in the thermo-assembly process of Le Roi du Plastique: opening work in...
The Guardians of the Universe launch a satellite that goes into orbit at a distance of 16698 km from the center of the earth. If the orbit is circular what is its speed? The universal gravitational...
Describe the accounting principle which explains losses are assets, and profits and capital are liabilities for a business firm.
What are closing entries? Why are they needed? Name the type of accounts (a) required to be closed and (b) not required to be closed.
What is the major revenue recognition criterion?
What is indicated when the average age of accounts receivable for a firm is 45 days, but credit terms require customers to pay accounts within 30 days?
(a) Discuss some inherent limitations of single-year financial statements for purposes of analysis and interpretation. (b) To what extent are these limitations overcome by the use of comparative...
1.) Land Services, Inc. owns 30% of voting stock of World Investments, Inc. During the year 2018, World Investments, Inc. earned profits of $320,000. Under the equity method, which of the following...
Danielle has an insurance policy with a premium of $75 per month. In September she is in an accident and receives a bill worth $2990 for the repair of her own property. Her deductible is $250 and her...
The probability that the loss from a portfolio will be greater than $10 million in one month is estimated to be 5%. (a) What is the one-month 99% VaR assuming the change in value of the portfolio is...
Estimate the interest rate paid by P&G on the 5/30 swap in Business Snapshot 5.4 if (a) The CP rate is 6.5% and the Treasury yield curve is flat at 6% (b) The CP rate is 7.5% and the Treasury yield...
A company enters into a short futures contract to sell 5,000 bushels of wheat for 250 cents per bushel. The initial margin is $3,000 and the maintenance margin is $2,000. What price change would lead...
Determine whether each of the following statements is true or false: Management accountants should be technically proficient, but they dont need strong oral and written communication skills.
Determine whether each of the following statements is true or false: Management accountants are now more often looked upon as internal business advisors rather than bean counters recording historical...
Determine whether each of the following statements is true or false: The Association of International Certified Professional Accountants (AICPA) issues the Certified Management Accountant (CMA)...

Suppose that the assets of a bank consists of $100 million of loans to A rated corporations.

Question:

Expert Answer:

Heres how to calculate the RWA RiskWeighted Asset for the bank ba... View the full answer

Risk Management and Financial Institutions

Students also viewed these finance questions