Determine the balance sheet changes


Response to the following problem:

The AllStar Bank has the following balance sheet:

Assets  (in millions)                              Liabilities
Cash                   $30                          Deposits      $90
Other assets        140                     Borrow funds     40
                          $170                    Other liabilities    40
                                                                            $170

Its largest customer decides to exercise a $15 million loan commitment. Show how the new balance sheet changes if AllStar uses ( a ) stored liquidity management or ( b ) purchased liquidity management.

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Financial Accounting: Determine the balance sheet changes
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