skip to Main Content
The smarter way
to do assignments.

Please note that this is just a preview of a school assignment posted on our website by one of our clients. If you need assistance with this question too, please click on the Order button at the bottom of the page to get started.

Regulators calculate that DLC bank (see Section 2.2) will report a profit that is normally distributed with a mean of $0.6 million and a standard deviation of $2.0 million. How much equity capital in addition to that in Table 2.2 should regulators require for there to be 99.9% chance of the capital not being wiped out by losses?

Table 2.2:

Summary of Balance Sheet for DLC at End of 2012 ($millions)

Assets:

Cash 5

Marketable Securities 10

Loans 80

Fixed Assets 5

Total 100

Liabilities and Net Worth:

Deposits 90

Subordinated Long-Term Debt 5

Equity Capital 5

Total 100

Table 2.3: Summary Income Statement for DLC in 2012 ($ millions)

Net interest income 3.00

Loan Losses (0.80)

Non-interest income 0.90

Non-interest expense (2.50)

Pre-tax operating income 0.60

GET HELP WITH THIS ASSIGNMENT TODAY

Clicking on this button will take you to our custom assignment page. Here you can fill out all the additional details for this particular paper (grading rubric, academic style, number of sources etc), after which your paper will get assigned to a course-specific writer. If you have any issues/concerns, please don’t hesitate to contact our live support team or email us right away.

How It Works        |        About Us       |       Contact Us

© 2018 | Intelli Essays Homework Service®