Question

Two depository institutions have composite CAMELS ratings of 1 or 2 and are ‘well capitalized.’ Thus, each institution falls into the FDIC Risk Category I deposit insurance assessment scheme. Further, the institutions have the following financial ratios and CAMELS ratings: Use Table. Institution 1 Institution 2 Tier I leverage ratio (%) 8.63 7.76 Loans past due 30–89 days/gross assets (%) 0.46 0.57 Nonperforming assets/gross assets (%) 0.36 0.51 Net loan charge-offs/gross assets (%) 0.29 0.33 Net income before taxes/risk-weighted assets (%) 2.16 1.87 Adjusted brokered deposits ratio (%) 0.00 15.57 CAMELS components: C 1 1 A 1 3 M 1 1 E 3 3 L 1 2 S 1 1 Pricing Multiplier Uniform Amount 4.861 Tier I leverage ratio (%) (0.056) Loans past due 30-89 days/gross assets (%) 0.575 Nonperforming assets/gross assets (%) 1.074 Net loan charge-offs/gross assets (%) 1.210 Net income before taxes/risk-weighted assets (%) (0.764) Adjusted brokered deposits ratio (%) 0.065 Weighted average CAMELS component ratings 1.095 Calculate the initial deposit insurance assessment rate for each institution. (Do not round intermediate calculations. Round your answers to 2 decimal places. (e.g., 32.161))

Answer 1