Answer Happy

Question 4 (3 Marks)
For Admin Bank, what is the credit risk-weighted value of:
1. $150 in bonds issued by
the South Australian Government Financing Authority (AAA),
2. $200, 3-year loan to
Westpac Bank (AA),
3. $80 in documentary letters
of credit secured against shipment of goods for Qantas Airways Ltd.
(BBB+),
4. $120 in commitments
(formal standby facility) to Commonwealth Bank (AA) with a residual
maturity of 6-months,
5. $40 guarantee to
Woolworths Ltd (A-),
6. $400 in housing loans
fully secured by registered first mortgages over residential
property, where the LVR is 70% or less.
Note: the letters in brackets following each term refer to the
credit rating of the relevant sovereign, government entity, bank,
development bank or non-financial corporation.
Please use the following framework to answer the question. Use
as many rows as you need in each
table. Copy and paste the below tables
into the answer box and fill in the blank
cells. Alternatively,
you could copy and paste (as text ,
not html) the tables into
Excel, populate, then paste into the answer panel or
upload the Excel
file.
Table 1: On-balance sheet items, Admin Bank
Item
Exposure ($)
Counterparty Risk Weight (%)
Risk-weighted value ($)
Total On-Balance Sheet Risk Weighted Value:
Table 2: Off-balance-sheet items, Admin
Bank
Item
Exposure ($)
Conversion factor (%)
Counterparty Risk weight (%)
Risk-weighted value ($)
Total Off-balance-Sheet Risk Weighted
Value:
Total credit risk-weighted assets =