FIN208 Financial Markets Services

Financial Markets ServicesTU Board 2024

The financial statements for City Bank (CB) are shown below: AssetsLiabilities and equityCashRs 450Demand depositsRs 5,510Demand deposits from other FIs1,350Small time…

The financial statements for City Bank (CB) are shown below: AssetsLiabilities and equityCashRs 450Demand depositsRs 5,510Demand deposits from other FIs1,350Small time deposits10,800Investments4,050Jumbo CDs3,200Federal funds sold2,025Federal funds purchased2,25015,525Equity2,200Gross loans(1,125)Reserve for loan losses1,685PremisesRs 23,960Total liabilities / equityRs 23,960Total assets Income statement City Bank Interest incomeRs 2,600Interest expense1,650Provision for loan losses180Noninterest income140Noninterest expense120Taxes90 The industry average (IA) for ROA is 1%, asset utilization is 10%, net interest margin is 11%, and spread ratio is 2.3%. a. Calculate the rupee value of City bank's earnings assets. b. Calculate the bank's ROA and asset utilization ratio. c. Calculate the bank's spread. d. Calculate the bank's net interest margin. e. Evaluate the bank's performance on the basis of calculated ratios. What other factors can be examined to evaluate the bank performance? Explain.

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