Let’s assume that you have been asked to calculate risk-based capital ratios for a bank with the following accounts:
3.10. Let’s assume that you have been asked to calculate risk-based capital ratios for a bank with the following accounts:Cash _ $5 millionGovernment securities _ $7 millionMortgage loans _ $30 millionOther loans _ $50 millionFixed assets _ $10 millionIntangible assets _ $4 millionLoan-loss reserves _ $5 millionOwners’ equity _ $5 millionTrust-preferred securities _ $3 millionCash assets and government securities are not considered risky. Loans secured […]