Question
In: Accounting
What is the contribution to the asset base of the following items under the Basel III...
What is the contribution to the asset base of the following items under the Basel III requirements? (Leave no cells blank - be certain to enter "0" wherever required. Enter your answers in dollars not in millions.)
| a. | $8 million cash reserves. |
| b. | $46 million 91-day U.S. Treasury bills. |
| c. | $23 million cash items in the process of collection. |
| d. | $4 million U.K. government bonds, OECD CRD rated 1. |
| e. | $4 million French short-term government bonds, OECD CRD rated 2. |
| f. | $3 million general obligation bonds. |
| g. | $40 million repurchase agreements (against U.S. Treasuries). |
| h. | $3 million loan to foreign bank, OECD rated 3. |
| i. | $460 million 1-4 family home mortgages, category 1, loan-to-value ratio 80%. |
| j. | $8 million 1-4 family home mortgages, category 2, loan-to-value ratio 95%. |
| k. | $4 million 1-4 family home mortgages, 100 days past due. |
| l. | $460 million commercial and industrial loans, AAA rated. |
| m. | $460 million commercial and industrial loans, B- rated. |
| n. | $300,000 performance-related standby letters of credit to a AAA rated corporation. |
| o. | $300,000 performance-related standby letters of credit to a municipality issuing general obligation bonds. |
| p. | $6 million commercial letter of credit to a foreign bank, OECD CRC rated 2. |
| q. | $2 million five-year loan commitment to a foreign government, OECD CRC rated 1. |
| r. | $3 million bankers’ acceptance conveyed to a U.S., AA rated corporation. |
| s. | $10 million three-year loan commitment to a private agent. |
| t. | $10 million three-month loan commitment to a private agent. |
| u. | $20 million standby letter of credit to back an A rated corporate issue of commercial paper. |
| v. | $8 million five-year interest rate swap with no current exposure. |
| w. | $7 million two-year currency swap with $600,000 current exposure. |
Solutions
Expert Solution
| Particulars | Basel III | US |
| $8 million cash reserves | 0 | $8000000 |
| $46 million 91-day U.S. Treasury bills. | 0 | $46000000 |
| $23 million cash items in the process of collection. | $3000000 | 0 |
| $4 million U.K. government bonds, OECD CRD rated 1. | $1000000 | $4000000 |
| $4 million French short-term government bonds, OECD CRD rated 2. | $2000000 | $4000000 |
| $3 million general obligation bonds. | ||
| $40 million repurchase agreements (against U.S. Treasuries). | $8000000 | $40000000 |
| $3 million loan to foreign bank, OECD rated 3. | $3000000 | $5000000 |
| $460 million 1-4 family home mortgages, category 1, loan-to-value ratio 80%. | $230000000 | $460000000 |
| $8 million 1-4 family home mortgages, category 2, loan-to-value ratio 95%. | $4000000 | $8000000 |
| $4 million 1-4 family home mortgages, 100 days past due. | $4000000 | 0 |
| $460 million commercial and industrial loans, AAA rated. | $460000000 | $460000000 |
| $460 million commercial and industrial loans, B- rated. | $460000000 | $460000000 |
ekkarill92 answered 1 year agoRelated Solutions
What is the contribution to the asset base of the following items under the Basel III...
What is the contribution to the asset base of the following
items under the Basel III requirements? (Leave no cells blank - be
certain to enter "0" wherever required. Enter your answers in
dollars not in millions. (e.g., 999,888,000))
Contribution to Risk Weighted assets
a.
$24 million cash items in the process of collection.
$
b.
$10 million repurchase agreements (against U.S.
Treasuries).
$
c.
$5 million 1-4 family home mortgages, 100 days past due.
$
d.
$200,000 performance-related standby...
Which of the following differences between BASEL III and BASEL II are not true: I. Basel...
Which of the following differences between BASEL III and BASEL
II are not true: I. Basel III strengthened Basel II capital
requirements by increasing CET1 capital to 6% of a bank's total
assets. II. Basel III established two new financial liquidity
requirements, the Liquidity Coverage Ratio and the Net Stable
Funding Ratio. III. Basel III established a minimum leverage ratio
of Tier 1 Capital to total exposure of 3%. IV. Basel III required a
new "discretionary counter-cyclical buffer" of 2.5%...
Explain what are the two concern areas and the reform measure under the Basel III reform...
Explain what are the two concern areas and the reform measure
under the Basel III reform package to reflect a bank as strong and
have a global capital standard.
Answer in 5 paragraphs with examples. thanks
(ii) Explain how banks in Ghana apply Bank Capital under the Basel Acord (iii) What...
(ii) Explain how banks in Ghana apply Bank Capital under the
Basel Acord
(iii) What is the significance of the Capital Adequacy Ratio
in Ghana?
Identify no less than five minimum standards under Basel II and III, and present the key...
Identify no less than five minimum standards under Basel
II and III, and present the key elements of how these standards
function.
Complete an internet search of the new requirements for Basel II and Basel III, namely the...
Complete an internet search of the new requirements for Basel II
and Basel III, namely the Strengthening of Capital, Global
Liquidity Standards, Leverage ratio, and Risk Coverage. Identify a
financial institution of the group choice or one that the group is
familiar with. Using the latest available financials statements of
the bank the group is familiar with you are required to do an
analysis showing how the new Basel requirements will impact the
bank/ financial institution and what plans the...
Clearly identify the significance of Basel I, II, III Accords.
Clearly identify the significance of Basel I, II, III
Accords.
The Basel III accord requires financial institutions to have two types of buffers. Critically discuss what...
The Basel III accord requires financial institutions to have
two types of buffers. Critically discuss what these buffers are,
their differences and objectives.
Word Count (500
words)
Which of the following statements with regard to classification of a bank’s regulatory capital under Basel...
Which of the following statements with regard to classification
of a bank’s regulatory capital under Basel III is true?
I Tier 1 capital includes retained earnings and surpluses
resulting from the issue of common shares, but not mandatory
convertible bonds
II Common Equity Tier 1 (CET1) capital includes retained
earnings and surpluses resulting from the issue of common shares,
but not contingent convertible bonds
III Tier 1 capital includes retained earnings and surpluses
resulting from the issue of common shares,...
Looking at the below article, answer the following: What flaws in Basel I did Basel II...
Looking at the below article, answer the following:
What flaws in Basel I did Basel II attempt to remedy and what
provisions did it make for doing so? What short-comings in bank
capital regulation remain?
The Rise of Basel II
Soon, a variety of inherent flaws in Basel I’s treatment of
capital became apparent. First, the relationship between
assets’ actual revealed default risk and their risk weights
proved to be less reliable than had been thought. For
instance, all bonds...
ADVERTISEMENT
ADVERTISEMENT
Latest Questions
- Draw a DFA for the following ( ∑ = {0,1}): Set of all strings with.
- In the article from Forbes notes that the goal of a leader is not to clone...
- Many people keep time using a 24 hour clock (11 is 11am and 23 is 11pm,...
- UNIX ONLY -- DIFFICULT LAB ASSIGNMENT This is an extremely difficult subject for me. Could you...
- Do you know why your credit card can be refused even though you are profitable?
- The Following Java expression: S/10 * 10 + 10 – S = C Show that this...
- Year Cash Flow 0 −$9,700 1 5,800 2 2,500 3 3,400 &nb
ADVERTISEMENT