Question

Problems: In order to earn full credit all your work including the complete formula must be shown. (Total 55 points) 1) The following information is available to you on the bank's statements (S million) Total bank assets Interest income on loans Interest expense paid on deposits Non-interest income Total non-interest expenses Provision for loan losses Income taxes 5600,000 14,400 6,000 2.400 3.600 240 120 Calculate the following ratios: (a) Net income after taxes - show complete income statement structure as discussed in lecture (10 points) (b) Net non-interest margin (5 points)

Answer 1

() $14400 ($GODO) $8400 (3L00) $ 2400 $72.00 C120) Income statement Interest income on loans o Interest expense paid on deposito operating income - Non interest orpenses () Non-interest Sncome Camings before taz provision for loan losses C ΣφO) Income tar paid Not focome $664D w Non-interest margin non-interest income non interest expense total ansato earning amets $2400 - $3600 $14,400 $.331. Return on aneb Net income Total aret $6640 $ COD00D 1.14. (4) equity multiplier = Total Assets Total shareholders equity $6000DO $ 5800 OD 1.03 Net income (5) Return on equity shareholders equüty focme Net $G$40 $5eowo = lg. operating margin = operating Interat income on loans $ 8400 = 58.337. $14400 1/1