1. Use the Excel spreadsheet below, and your End of Round 3 balance sheet above, to calculate your Tier 1 Capitalization Ratio.
Balance sheet end of round 3 Total Equity $1,141,801,28
Consumer Loans $4,000,000.00
Residential Loans
C & I $4,000.00
Tier 1 Capital = Equity(Total Loans) .
2. Assume that your bank is not obligated to pay taxes. Calculate your bank’s 1) ROA, 2) ROE, and 3) its ratio of bank assets to bank capital. These measures are presented in the text in Chapter 12’s section entitled Bank Capital and Profitability. Show your calculations for each of these three measures in the space below (show algebraically with both the numerator and denominator made clear).