Using the formulas developed in this chapter and in Chapter 6 and the information that follows, calculate the ratios of total capital to total assets for the banking firms listed below. What relationship among these banks€™ return on assets, return on equity capital, and capital-to-assets ratios did you observe? What implications or recommendations would you draw for the management of each of theseinstitutions?

Name of Bank Net Income Total Assets Net Income Total Equity Capital (or ROE) (or ROA) 1.25% 1590 First National Bank of Hopkins Safety National Bank Iisher State Bank Mercantile Bank and Trust 0.25% Company Lakeside National Trust 1.2% 13% 11% 390 0.9% -0.5%