Consider a bank with the following balance sheet: Assets Required reserves $11 Excess reserves $41 Loans $75 million mil

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Consider A Bank With The Following Balance Sheet Assets Required Reserves 11 Excess Reserves 41 Loans 75 Million Mil 1 (61.01 KiB) Viewed 34 times

Consider a bank with the following balance sheet: Assets Required reserves $11 Excess reserves $41 Loans $75 million million million Liabilities Checkable deposits $140 million Bank capital - $13 million Assume that required reserves are 8%. In order to avoid insolvency, regulators decide to provide the bank with $22 million in bank capital. Assume that bad news about mortgages is featured in the local newspaper, causing a bank run. As a result, $40 million in deposits is withdrawn. Show the effects of the capital injection and bank run on the balance sheet. (Round your responses to the nearest whole number.) million Assets Required reserves $ 8 Excess reserves $ 26 Loans $ 75 Liabilities Checkable deposits $ 100 million Bank capital $ 9 million million million Was the capital injection enough to stabilize the bank? The bank now has a capital ratio of 8.3%, and the bank is well capitalized (Round your response to one decimal place.) If the bank regulators decide that the bank needs a capital ratio of 10% to prevent further runs on the bank, how much of an additional capital injection is required to reach the 10% capital ratio? Bank regulators need to inject an additional $ 2.9 million to reach the 10% capital ratio. (Round your response to one decimal place.)