Assets Cash Investments (< 1 year) Short-term loans (< 1 year) Long-term fixed-rate loans (maturity> 1 year) Total the bank's one-year repricing gap is (million) Return 0.00% 4.00% 6.00% 6.75% Million $ $ 35 $ 200 $225 $ 250 $ 710 Liabilities and Equity Fixed-rate deposits Rate-sensitive deposits Fed fund borrowings Long-term borrowings at fixed rate (maturity> 1 year) Equity Total Cost 3.50% 2.00% 2.50% 5.50% Millions $ $ 240 $ 260 $25 $ 119 $ 66 $ 710
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- If Capital Two Bank (CTB) finances a $250,000 2-year fixed-rate loan with a $200,000 1-year fixed-rate CD, based on the repricing model, what is the change in CTB's net interest income for the 1-year maturity bucket when interest rates decrease by 100 basis points? OA. $500 OB. $2,000 OC.-$500 ⒸD.-$2,000A bank makes an amortizing loan of $200,000 with a maturity of 8 years and equal payments every year. What is the principal outstanding at the end of year 6 if the interest rate is 6%? A $27,041.78 B $30,384.41 C $59,048.42 D $86,092.20Bank of Charub ($ million)Assets: Liabilities and Net Worth:270 day US Treasury bills $500m 1 year Certificates of Deposit $550m2 year consumer loans Demand Deposits $750mFixed rate, 12% p.a. annually $275m 2 year Bonds $175m7 year commercial loans $350m Fixed rate, 7.5% p.a. annuallyFixed rate, 9% p.a. annually Overnight Fed Funds $350m10 year fixed rate mortgages $675mFixed rate, 6.5% p.a. monthly10 year floating rate mortgages $125m Equity $100mLIBOR+50bp, monthly roll dateNotes: The 1 year Certificates of Deposit pay 1.95% p.a. annually. The demand depositsare non-interest bearing and have a duration of zero. The 7 year commercial loans have aduration of 4.75 years. The fixed rate mortgages have a duration of 8.3 years. All valuesare market values. 4. What is the duration of the 2 year consumer loans if they yield 6% p.a. with acoupon rate of 12% p.a. paid annually?a. 1.87 yearsb. 3.84 yearsc. 2 yearsd. 0.5 yearse. 1.9 years
- Bank of Charub ($ million)Assets: Liabilities and Net Worth:270 day US Treasury bills $500m 1 year Certificates of Deposit $550m2 year consumer loans Demand Deposits $750mFixed rate, 12% p.a. annually $275m 2 year Bonds $175m7 year commercial loans $350m Fixed rate, 7.5% p.a. annuallyFixed rate, 9% p.a. annually Overnight Fed Funds $350m10 year fixed rate mortgages $675mFixed rate, 6.5% p.a. monthly10 year floating rate mortgages $125m Equity $100mLIBOR+50bp, monthly roll dateNotes: The 1 year Certificates of Deposit pay 1.95% p.a. annually. The demand depositsare non-interest bearing and have a duration of zero. The 7 year commercial loans have aduration of 4.75 years. The fixed rate mortgages have a duration of 8.3 years. All valuesare market values.1. What is the duration of the floating rate mortgages?a. 0.25 yearsb. 10 yearsc. 2 yearsd. 0.08 yearse. There is not enough information to answer the questionBank of Charub ($ million)Assets: Liabilities and Net Worth:270 day US Treasury bills $500m 1 year Certificates of Deposit $550m2 year consumer loans Demand Deposits $750mFixed rate, 12% p.a. annually $275m 2 year Bonds $175m7 year commercial loans $350m Fixed rate, 7.5% p.a. annuallyFixed rate, 9% p.a. annually Overnight Fed Funds $350m10 year fixed rate mortgages $675mFixed rate, 6.5% p.a. monthly10 year floating rate mortgages $125m Equity $100mLIBOR+50bp, monthly roll dateNotes: The 1 year Certificates of Deposit pay 1.95% p.a. annually. The demand depositsare non-interest bearing and have a duration of zero. The 7 year commercial loans have aduration of 4.75 years. The fixed rate mortgages have a duration of 8.3 years. All valuesare market values. 5. What is the convexity of the 2 year consumer loans if they yield 6% p.a. witha coupon rate of 12% p.a. paid annually?a. 4.98b. 2.83c. 3.85d. 1.95e. 2.01Bank of Charub ($ million)Assets: Liabilities and Net Worth:270 day US Treasury bills $500m 1 year Certificates of Deposit $550m2 year consumer loans Demand Deposits $750mFixed rate, 12% p.a. annually $275m 2 year Bonds $175m7 year commercial loans $350m Fixed rate, 7.5% p.a. annuallyFixed rate, 9% p.a. annually Overnight Fed Funds $350m10 year fixed rate mortgages $675mFixed rate, 6.5% p.a. monthly10 year floating rate mortgages $125m Equity $100mLIBOR+50bp, monthly roll dateNotes: The 1 year Certificates of Deposit pay 1.95% p.a. annually. The demand depositsare non-interest bearing and have a duration of zero. The 7 year commercial loans have aduration of 4.75 years. The fixed rate mortgages have a duration of 8.3 years. All valuesare market values. 2. What is the duration of the 2 year bonds they are selling at par at 7.5% p.a.interest, compounded annually?a. 1.93 yearsb. 1 yearc. 2 yearsd. 1.5 yearse. 3.86 years
- Bank of Charub ($ million)Assets: Liabilities and Net Worth:270 day US Treasury bills $500m 1 year Certificates of Deposit $550m2 year consumer loans Demand Deposits $750mFixed rate, 12% p.a. annually $275m 2 year Bonds $175m7 year commercial loans $350m Fixed rate, 7.5% p.a. annuallyFixed rate, 9% p.a. annually Overnight Fed Funds $350m10 year fixed rate mortgages $675mFixed rate, 6.5% p.a. monthly10 year floating rate mortgages $125m Equity $100mLIBOR+50bp, monthly roll dateNotes: The 1 year Certificates of Deposit pay 1.95% p.a. annually. The demand depositsare non-interest bearing and have a duration of zero. The 7 year commercial loans have aduration of 4.75 years. The fixed rate mortgages have a duration of 8.3 years. All valuesare market values.3. What is the face value of the 2 year consumer loans if they yield 6% p.a. witha coupon rate of 12% p.a. paid annually?a. $175 millionb. $165 millionc. $247.7 milliond. $155 millione. $172 millionUSE THE FOLLOWING INFORMATION FOR THIS QUESTION: Installment note payable borrowed from the bank Present value interest factor from table Signed for Annual interest rate Payments are made 195,060 $7,802 $99,442 The outstanding loan balance at the end of year 3 equals what amount? $103,420 zero $287,000 unable to determine 2.77509 3 years 4% Annually7 lender appraised value : $8,400,000 cash flow :$444,000 Using Information Above what would be the loan amount assuming a 75% loan-to-value and a 9% debt yield? Round to nearest dollar.
- A bank offers 10.21 percent compounded semi-annually on its business loans. Calculate the EAR. Select one: a.10.07% b.9.63% c.11.03% d.10.47%Consider the following Balance Sheet for Forward Thinking Commercial Bank(FTCB) (in millions) ASSETS LIABILITIES Floating rate mortgages 250 Demand deposits 300 (currently 14% annually) (currently 5% annually) 30 years fixed rate loans 1 year CD 50 (currently 9% annually) 120 (currently 8% annually) Equity 20 370 370 a. What is FTCB expected net interest income (NII) at year end? b. What is FTCB expected net interest income at year end if interest rates fell by seven percent (7%). c. What is FTCB expected net interest income at year end if interest rates grew by 300 basis points on assets, but decline by 2% on liabilities.QUESTION: 1 State Bank's balance sheet is listed below. Market yields are in parentheses, and amounts are in millions. Assets Liabilities and Equity $ 20 $ 250 20 Cash Fed funds (5.05%) 3-month T-bills (5.25%) 2-year T-notes (6.50%) 8-year T-notes (7.50%) 5-year munis (floating rate) (8.20%, repriced @ 6 months) 6-month consumer loans (6%) 1-year consumer loans (5.8%) 5-year car loans (7%) 7-month C&l loans (5.8%) 2-year C&l loans (floating rate) (5.15%, repriced @ 6 months) 15-year variable-rate mortgages (5.8%, repriced @ 6 months) 15-year variable-rate mortgages (6.1%, repriced @ year) 15-year fixed-rate mortgages (7.85%) 30-year variable-rate mortgages (6.3%, repriced O quarter) 30-year variable-rate mortgages (6.4%, repriced @ month) 30-year fixed-rate mortgages (8.2%) Premises and equipment Total assets Demand deposits Savings accounts (1.5%) MMDAS (4.5%) (no minimum balance requirement) 3-month CDs (4.2%) 6-month CDs (4.3%) 1-year CDs (4.5%) 2-year CDs (5%) 4-year CDs (5.5%)…
