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ABC Bank has made 1000 interest-only mortgage loans, reflecting $250,000,000 in balances. After five years, 75 loans have def
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Answer #1

Unit weighted loss given default as per the question = Loss of principal + Loss in interest income = 28,000,000+15,000,000 = USD 43,000,000

Dollar Weighted loss given default = Total loss on default/Total balance = USD 43,000,000/250,000,000 =17.2%

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