consider a bank with the following balance sheet 637384

Consider a bank with the following balance sheet:

Assets

Liabilities

Required Reserves

$8 million

Checkable Deposits

$100 million

Excess Reserves

$3 million

Bank Capital

$6 million

T bills

$45 million

 

 

Commercial Loans

$50 million

 

 

The bank commits to a loan agreement for $10 million to a commercial customer. Calculate the bank’s capital ratio before and after the agreement. Calculate the bank’s risk weighted assets before and after the agreement. Problems 4 through 11 relate to a sequence of transactions at Oldhat Financial.