Here again is the balance sheet information for Cipher Bank. It will be repeated

Question

Here again is the balance sheet information for Cipher Bank. It will be repeated in future questions to make things a bit easier. Note that you can, and may have to, calculate anything marked with a "???," and anything not included or otherwise calculable $0. Assets Liabilities and Owner's Equity Buildings and furniture $900 Checking depos Cash $80 Commercial paper $500 Deposit in the Fed $320 Government agency bonds $800 oroig trom the Fe Home mortgages $1200 Loan to Bank A $400 Loans to firms $1100 Loans to households $1300 Municipal bonds $1400 US government bonds $600 Savings deposits $800 Time deposits $200 Borrowing from Bank B $500 Other liabilities $1000 Equity $??? Total assets $8600 Total liabilities and owner's equity ???

Explanation / Answer

Here, Equity is Total Assets - Total Liabilities = 8600 - 6200 = $ 2400

Rate Sensitive Assets = Home mortgages (1200x0.80=960) + Loan to Bank ($400) + Loan to HH ($ 1300) + Loan to Firm ( $550) + Commercial Paper ($ 500) + Deposit in Fed ( 320) + Govt Agency Bonds (800) + Bonds (2000) = $ 6830

Rate Sensitie Liabilities = Borrowing from Banks and Fed = $ 2100

Thus GAP = RSA - RSL = $ 6830 - $ 2100 = $ 4730

Related Questions

Navigate

• Browse (All)
• Browse H
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.