Calculate the equity capital ratio if 2 million in bad


A bank’s assets consist of :

Cash:                                 3 million

Loans:                               15 million

Securities:                          6 million

Fixed Assets:                    3 million

In addition, the Owners’ Capital is 2.5 million

Calculate the equity capital ratio.

If $2 million in bad loans were removed from the bank’s assets, show how the equity capital ratio would change.

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Financial Management: Calculate the equity capital ratio if 2 million in bad
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