The following is the balance sheet numbers reported by Bay Bank for 2020. Based on Basel 1 standards, are the banks adequately capitalized? (in millions) US Treasury Bonds $25 Deposits $297.00 Municipal Bonds $15 Mortgages $75 Bonds (Tier 2 Capital) $8.00 Loans $200 Equity (Tier 1 Capital) $10.00 Total $315 $315.00 Yes, they have sufficient Tier 1 and Tier 1+2 capital No, they do not have sufficient Tier 1 or Tier 1+2 capital No, they have sufficient Tier 1 but insufficient Tier 1+2 capital No, they do have sufficient Tier 1+2 capital but insufficient Tier 1 capital

The following is the balance sheet numbers reported by Bay Bank for 2020. Based on Basel 1 standards, are the banks adequately capitalized? (in millions) US Treasury Bonds $25 Deposits $297.00 Municipal Bonds $15 Mortgages $75 Bonds (Tier 2 Capital) $8.00 Loans $200 Equity (Tier 1 Capital) $10.00 Total $315 $315.00 Yes, they have sufficient Tier 1 and Tier 1+2 capital No, they do not have sufficient Tier 1 or Tier 1+2 capital No, they have sufficient Tier 1 but insufficient Tier 1+2 capital No, they do have sufficient Tier 1+2 capital but insufficient Tier 1 capital

Microeconomics A Contemporary Intro

10th Edition

ISBN:9781285635101

Author:MCEACHERN

Publisher:MCEACHERN

Chapter13: Capital, Interest, Entrepreneurship, And Corporate Finance

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Problem 9QFR

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The following is the balance sheet numbers reported by Bay Bank for 2020. Based on Basel 1 standards, are the banks adequately capitalized? (in millions) US Treasury Bonds $25 Deposits $297.00 Municipal Bonds $15 Mortgages $75 Bonds (Tier 2 Capital) $8.00 Loans $200 Equity (Tier 1 Capital) $10.00 Total $315 $315.00 A Yes, they have sufficient Tier 1 and Tier 1+2 capital b No, they do not have sufficient Tier 1 or Tier 1+2 capital c No, they have sufficient Tier 1 but insufficient Tier 1+2 capital d No, they do have…
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(in millions)
US Treasury Bonds	$25	Deposits		$297.00
Municipal Bonds	$15
Mortgages	$75	Bonds (Tier 2 Capital)	$8.00
Loans	$200	Equity (Tier 1 Capital)	$10.00
Total	$315			$315.00

		Yes, they have sufficient Tier 1 and Tier 1+2 capital
		No, they do not have sufficient Tier 1 or Tier 1+2 capital
		No, they have sufficient Tier 1 but insufficient Tier 1+2 capital
		No, they do have sufficient Tier 1+2 capital but insufficient Tier 1 capital