A Bank has the following balance sheet (in millions), with the risk weights in parentheses. In addition, the bank has $30 million in commercial direct-credit substitute standby letters of credit to a public corporation and $30 million in 10-year FX forward contracts that are in the money by $2 million. a. What are the risk-adjusted on-balance-sheet assets of the bank as defined under the Basel III? (I have this answer which should follow into question B) Cash = $19 x 0% = 0 Mortgage Loan = $65 x 50% = $32.50 Consumer Loans = $155 x 100% = $155 Therefore, the Total Risk-Adjusted On-Balance Sheet Assets is $187.50. (Unless you suggest to round to $188 for below calculations please let me know) b. What are the: Common Equity Tier I (CET1) Risk-Based Capital Ratio Tier I Risk-Based Capital Ratio The Total Risk–Based Capital Ratio? *PLEASE HELP WITH B!!! Confused with which numbers on the balance sheet to include in the Common Equity Tier 1 Capital (CET 1), Additional Tier 1 Capital (Tier 1) and Tier 2 Capital (Total Tier 1 + Tier 2). PLEASE Do no copy and paste from other answers*** I have checked those solutions already and they don't meet the text completely. Thank YOU *Will thumbs up if helped! :)
A Bank has the following
In addition, the bank has $30 million in commercial direct-credit substitute standby letters of credit to a public corporation and $30 million in 10-year FX forward contracts that are in the money by $2 million.
a. What are the risk-adjusted on-balance-sheet assets of the bank as defined under the Basel III? (I have this answer which should follow into question B)
Cash = $19 x 0% = 0 Mortgage Loan = $65 x 50% = $32.50 Consumer Loans = $155 x 100% = $155
Therefore, the Total Risk-Adjusted On-Balance Sheet Assets is $187.50. (Unless you suggest to round to $188 for below calculations please let me know)
b. What are the:
Common Equity Tier I (CET1) Risk-Based Capital Ratio
Tier I Risk-Based Capital Ratio
The Total Risk–Based Capital Ratio?
*PLEASE HELP WITH B!!! Confused with which numbers on the balance sheet to include in the Common Equity Tier 1 Capital (CET 1), Additional Tier 1 Capital (Tier 1) and Tier 2 Capital (Total Tier 1 + Tier 2).
PLEASE Do no copy and paste from other answers*** I have checked those solutions already and they don't meet the text completely.
Thank YOU *Will thumbs up if helped! :)
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