The following table shows the balance sheet for ABC Credit Union. Use the information to answer the following question.
Posted: Thu May 26, 2022 7:25 am
The following table shows the balance sheet for ABC Credit
Union. Use the information to answer the following question.
What is the maximum amount of loan losses the bank can
withstand? How would your answer change if, holding total assets
constant, checkable deposits decreased to $400m? Explain your
answer
Assets
Liabilities
Reserves = $50m
Interbank loans = $45m
T-bills = $150m
Corporate bonds = $25m
Commercial loans = $200m
Checkable deposits = $440m
Bank capital = 30
Union. Use the information to answer the following question.
What is the maximum amount of loan losses the bank can
withstand? How would your answer change if, holding total assets
constant, checkable deposits decreased to $400m? Explain your
answer
Assets
Liabilities
Reserves = $50m
Interbank loans = $45m
T-bills = $150m
Corporate bonds = $25m
Commercial loans = $200m
Checkable deposits = $440m
Bank capital = 30