Standard Side Bank, a U.S. national bank, has $70 million in unimpaired capital
ID: 2800680 • Letter: S
Question
Standard Side Bank, a U.S. national bank, has $70 million in unimpaired capital and surpluses and $86 million in total time and savings deposits. Average revenue for the bank in the last three years is $12.5 million and a net interest income of $3.2 million. Pluto Inc. has applied for a loan of $9 million to the bank against which it is willing to provide $1 million worth of ten-year treasury securities. What is the maximum amount of loan the bank can make to Pluto?
$10.0 million
$9.4 million
$10.5 million
$8.5 million
$11.5 million
$10.0 million
$9.4 million
$10.5 million
$8.5 million
$11.5 million
Explanation / Answer
National bank, has $70 million in unimpaired capital and surpluses
$86 million in total time and savings deposits
Average revenue for the bank in the last three years is $12.5 million and a net interest income of $3.2 million. Pluto Inc. has applied for a loan of $9 million to the bank
The maximum amount of loan the bank can make to Pluto is $ 8.5 million.
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