XYZ Bank has the following balance sheet (in $million): Loans 100 &nbspXYZ Bank has the...

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Accounting

XYZ Bank has the following balance sheet (in $million):
                 Loans     100
                 Securities             25
Inter-bankLending           0
                 Cash/Reserves     10
-        -
DemandDeposits              110
Bonds                                       20
Equity                                       ?
.   Here’s ABC Bank’s balance sheet (in $million):
                 Loans     2000
                 Securities             250
                 Cash/reserves      12
-        -
DemandDeposits              1000
Bonds                                       200
Inter-bank Borrowing      1040
Equity                                       ?
Return to the original balance sheets for ABC and XYZ. Supposereserve requirements are 3% against deposits. What are total,required and excess reserves for XYZ and ABC?
XYZ lends $5 million to ABC in the federal funds market. Showtheir new balance sheets. What are the new total, required andexcess reserves for XYZ and ABC? What are their new leverage ratioscompared to question 2.
Show the new balance sheets for ABC and XYZ, as well XYZ’s andABC’s new reserves positions on the Federal Reserve’s balanceshee

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3.9 Ratings (554 Votes)

For XYZ Ltd Total Assets 1002510 135 Total Liabilities 11020 130 Thus Total Equity 135130 5 If the reserves requirement is 3 then total reserves 1033 133 See Answer

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In: AccountingXYZ Bank has the following balance sheet (in $million): Loans 100 &nbspXYZ Bank has the following balance sheet (in $million): Loans 100 Securities 25Inter-bankLending 0 Cash/Reserves 10- -DemandDeposits 110Bonds 20Equity ?. Here’s ABC Bank’s balance sheet (in $million): Loans 2000 Securities 250 Cash/reserves 12- -DemandDeposits 1000Bonds 200Inter-bank Borrowing 1040Equity ?Return to the original balance sheets for ABC and XYZ. Supposereserve requirements are 3% against deposits. What are total,required and excess reserves for XYZ and ABC?XYZ lends $5 million to ABC in the federal funds market. Showtheir new balance sheets. What are the new total, required andexcess reserves for XYZ and ABC? What are their new leverage ratioscompared to question 2.Show the new balance sheets for ABC and XYZ, as well XYZ’s andABC’s new reserves positions on the Federal Reserve’s balanceshee