Question

The financial statements for First National Bank (FNB) are shown below:

Balance Sheet First National Bank
Assets					Liabilities and Equity
Cash	$	520			Demand deposits	$	5,390
Demand deposits from other FIs		1,700			Small time deposits		11,200
Investments		4,400			Jumbo CDs		3,550
Federal funds sold		2,235			Federal funds purchased		2,600
Loans		16,225			Equity		2,550
Reserve for loan losses		(1,825	)
Premises		2,035
Total assets	$	25,290			Total liabilities/equity	$	25,290

Income Statement First National Bank
Interest income	$	2,950
Interest expense		1,960
Provision for loan losses		250
Noninterest income		210
Noninterest expense		490
Taxes		70

a. Calculate the dollar value of FNB’s earning assets.
b. Calculate FNB’s ROA. (Round your answer to 2 decimal places. (e.g., 32.16))
c. Calculate FNB’s asset utilization ratio. (Round your answer to 2 decimal places. (e.g., 32.16))
d. Calculate FNB’s spread. (Round your answer to 2 decimal places. (e.g., 32.16))

Answer 1

The answer for above problem is explained below.

Calulao of tre dollor Valuc of FNK,s Assets Earning Assetsご|Tnvestorent SCC u itics Net oans Net Loans コキ 16,635- Earning AsSets 1,035 Calca of FNds RoA RoA xLOO Total ASSets 10 - $50 Net -Income = $ 390

Total Asse女ご $25,290 A X100 5,240 Ron 1.54% of FNgs asser otiizabion sato: Total ncome xloo Assets ob li zahon- Tota! ASSets 3,160 Assets Utilizahm- 63,'60 35 290 Assets Utilization 12.49% 6 ] sCatculaon of FNds Spread

Spread 书al ,035 f (1,200 t 3550 +率2,600 0.14 02 O.1 2Xloo 9H3ゾ