Julian Eastheimer Essay

Julian Eastheimer Essay
As a finance student, you should be able to help Bentley by telling him which companies in Section B should use the financing methods listed in
Section A.
Section A Leasing arrangements Long–term bonds Debt with warrants Friends or relatives Common stock: non–rights Preferred stock (nonconvertible)
Common stock: rights offering Convertible debentures Factoring
Section B
Boudoir's Inc. Timberland Power & Light Ripe and Fresh Canning Company Piper Pickle Company Copper Mountain Mining Company Bull Gator
Saloon and Dance Hall Golden Gate Aircraft Corporation Schooner Yachts Teller Pen Corporation
Financing MethodCompanyReasoning
1. Leasing arrangementsBoudoir's Inc.The ... Show more content on Helpwriting.net ...
Another option is the issuing of preferred stock, the company's common stock is already overvalued in the market; therefore, sourcing additional
capital through common stock might result to lower proceeds. Common stock: rights offeringGolden Gate Aircraft CorporationIssuing additionaldebt to
finance the company expansion would worsen the company's debt ratio as it is already more than average. The company envisions to be profitable by
raising capital from existing stockholders by issuing common stock through rights offering. Convertible debenturesTeller Pen CorporationThe
company's leverage ratio is 28% – 72% of its assets are financed by common equity and the company was profitable in the last reporting period. The
company should easily raise additional funds from creditors and a convertible debenture will be an appealing venture for creditors who would want to
purchase stocks of the company in the future. FactoringRipe and Fresh Canning CompanyThe company's credit terms are 60–day, but it needs to pay
its purchases within 30 days after purchase. Factoring would provide a short–term solution to reduce the gap between average collection and payment
periods.
Answers:
Leasing arrangementBoudoir's, Inc.The company can negotiate for a lease to own arrangements for the new building with a builder/contractor.
Long term bondsTimberland Power & LightGiven that the maximum long term debt

... Get more on HelpWriting.net ...

Banking : Theory And Practice
Banking: Theory & Practice FINA3304: 2015 Group Assignment Task 1: Basel III– Capital adequacy
Basel III consists of a comprehensive set of reform measures intended to improve the regulation, supervision and risk management of the banking
sector (APRA 2013). Being developed mainly in response to the credit crisis of 2007, it requires banks to maintain adequate leverage ratios and meet
certain capital requirements. Basel III builds on the basis of previous Basel I and Basel II and is aimed at improving the banking sector's ability to deal
with financial stress and turmoil, strengthen the banking sectors transparency and improve risk management (Investopedia 2015).
In Australia, the Australian Prudential Regulatory Authority... Show more content on Helpwriting.net ...
Since 2010 APRA has been involved in the active implementation of a series of updates to its prudential standards to ensure consistency with the
capital requirements of the Basel III framework. In September 2012 APRA published a ultimate set of prudential standards that address the foremost
elements of the Basel III capital reforms in Australia. Subsequently, in November 2012 they also issued a package of final actions, including
requirements for counterparty credit risk, which completed APRA's implementation of the Basel III capital reforms for ADIs (McCoach 2014). Graph
1B (see appendix) shows how the minimum Tier 1 capital requirement have been increased, from 4 per cent to 6 per cent of risk–weighted assets, which
will take effect once fully phased in. APRA required ADIs to meet its new capital requirements for CET1 capital andTier 1 capital at the beginning of
2013, which was two years ahead of the phase–in deadline, and also required ADI's to adhere to the full capital conservation buffer requirement at the
start of 2016 as shown in Graph 1B (Reserve Bank of Australia 2013). Australia has implemented certain aspects of Basel III ahead of the scheduled
timeline to ensure that banks and other ADI's have a significant amount of time to prepare for implementation.
The predominant goal of the

Essay about Trends In Australian Bank Capital
LETTER OF TRANSMITTAL
This report's topic is Trends in Australian Bank Capital. The content is as following:
1.The explanation of why "Regulators usually want more equity capital whereas shareholders usually favour less equity capital"
2.The differences between bank equity capital and bank regulatory capital
3.A discussion of the functions of bank capital and the role of the risk–return trade–off
4.The differences between tier 1 and tier 2 capital
5.The components of tier 1 and tier 2 capital and the cost and risk implications of them
6.Details of the trends in the four major Australian banks for the last five years.
1.
In Hogan et al (2004) Page 249 states that ВЎВ§from the shareholdersВЎВ¦ point of view, the appropriate ... Show more content on Helpwriting.net ...
These requirements define what is acceptable as capital and provide for standard methods of measuring the risks incurred by the Bank. APRA has set
minimum ratios that compare the regulatory capital with risk weighted on and off balance sheet assets. The minimum risk–weighted capital ratio is
8%. The following formula is used to calculate the risk–weighted capital ratio:
Risk–weighted capital ratio = Qualifying capital . Total risk–weighted assets
The numerator of the ratio is qualifying capital, which includes Tier 1 capital such as paid–up ordinary shares and retained profits, and Tier 2 capital
such as term subordinated debt after making required deductions for items such as goodwill and equity holdings in other banks.
Equity capital is a permanent commitment of funds which earns the residual income of the firm after all interest and other costs have been paid. In
Orgler/ Wolkowitz Bank Capital 1976, bank equity capital represents ВЎВ§all claims on the bankВЎВ¦s profits, and in the Report of Condition it is
divided into several accounts that include preferred stock, common stock, surplus, undivided profits, and reserves for contingencies and other capital
reservesВЎВЁ. Whereas regulatory bank capital is bank funding which qualifies as bank regulatory capital under the

Nt1310 Unit 1 Assignment
Lesson Standard– Grade 1: Determine or clarify the meaning of unknown and multiple–meaning words and phrases based on grade 1 reading and
content, choosing flexibly from an array of strategies.
a. Use sentence–level content as a clue to the meaning of a word or phrase.
Lesson Goal/Objective– The students will learn to identify words with multiple and similar meanings. The students will be able to recognize the
meaning of the word using the context of the sentence.
Description of Unit– ELD Standard
List of Tier 2– High Frequency/Multiple Meaning Vocabulary–
Field
Gather
Naughty
Fright
List of Tier 3– Low Frequency, Context– Specific Vocabulary–
Lane
Wandered
Scampered
Trembling
Peeked
List of Tier 1– Basic Vocabulary
Ran
Cry
For this language lesson, I would be reading the book, "Peter ... Show more content on Helpwriting.net ...

Another example I would use, would be a picture of 'Peter Rabbit' running, which could be an illustration of the vocabulary words 'wandered' or
'scampered'. During the reading of the story 'Peter Rabbit', I will point to the vocabulary word in the pocket chart and ask my students, 'what is this
word'? and we will say it together; example: 'Trembling'. I would then ask the students a comprehension question like; 'What was Peter Rabbit doing'?
A students response could be; 'Peter Rabbit was trembling with fright'.
An activity that I would have the students do is the sorting of the vocabulary words with similar meanings. I would demonstrate this activity by
using the word 'road'. I would have my students pick out the vocabulary word from the story that had a similar meaning as the word 'road', which
would be 'lane'. Once they were able to identify the vocabulary word from the story, I would ask them if they could tell me another word that may
have a similar meaning from our lists of words. For example, the students would find the word 'street'. Once I had gone over

Factors of Bank Dividend Policy
The current issue and full text archive of this journal is available at www.emeraldinsight.com/0307–4358.htm
Explanatory factors of bank dividend policy: revisited
John Theis and Amitabh S. Dutta
D. Abbott Turner College of Business, Columbus State University, Columbus, Georgia, USA
Abstract
Purpose – The purpose of this paper is to examine the Dickens et al. model of bank holding company dividend policy. They identified five explanatory
factors in a sample of bank holding companies (BHCs). Banking companies typically pay larger dividends and more often than industrial firms.
Investors often look at the dividends as being important return variables. Design/methodology/approach – In this study, a sample of 99 firms with 2006
data ... Show more content on Helpwriting.net ...
They report the market value of the firm first increases as insider holdings increase from 0 to 5 per cent. As insider holdings increase from 5 to 25
per cent, the market value of the firm decreases. As insider holdings increase beyond 25 per cent, the market value of the firms again increases. They
argue their results are evidence of managerial entrenchment. While lower and higher levels of insider holdings support the notion that insider
holdings lead to lower agency costs, the middle level of ownership is a range over which managerial control seems to be linked with a significantly
lower market price of equity. The Morck et al. (1988) non–linearity results may be sample and/or time dependent. However, Wruck (1989) confirms the
range of ''entrenchment'' reported by Morck et al. She finds in a sample of firms announcing a private equity sale firm value increases significantly
for firms with low and high levels of insider holdings. Her findings confirm that, in a middle range of insider holdings, firm value decreases
significantly. In a study tracking the decline of banking in the USA, Gorton and Rosen (1995), find a non–linear relation between insider shareholdings
and risk–taking in lending activity. Using a sample of 458 BHCs, they present a model illustrating how managerial ownership of banks can lead to
entrenchment, resulting in management activities that reduce firm value. Gorton and Rosen's findings support the non–linear effect

Basel Iii
Basel III is a global comprehensive collection of restructured regulatory standards on bank capital adequacy and liquidity. It was developed by the Basel
Committee on Banking Supervision to strengthen the regulation, supervision and risk management of the banking sector (bis.org, 2010). It introduces
new regulatory requirements on bank liquidity and bank leverage in response to the financial downturn caused by the Global Financial Crisis. Stefan
Walter, Secretary General of the Basel Committee on banking supervision said in November 2010:
"There are many factors that led to the build up of the crisis. At the top of the list is excess liquidity, resulting in too much credit and weak underwriting
standards. The vulnerability of the banking ... Show more content on Helpwriting.net ...
3. Supplementing the risk–based capital requirement with a leverage ratio
One of the primary feature of the Global Financial Crisis, as well as other previous financial crises, was the build up of excessive on and off–balance
sheet leverage in the banking system. The force on the banking system to reduce its leverage caused a forced decline on asset prices worsening the
feedback between looses, deterioration in bank capital and the reduction of credit availability. The framework introduced a leverage ratio requirement,
fixed at 3% (actuaries.asn.au, 2011), which aims to constrain leverage in the banking sector, and introduce additional protection against model risk
and measurement error. This will help alleviate the risk of the deleveraging processes, which can damage the financial system (bis.org, 2010). The
introduced leverage ratio will be a reliable extra measure to the risk–based requirement.
4. Reducing procyclicality and promoting countercyclical buffers Procyclical amplification has been one of the most threatening elements that caused
financial shocks throughout the banking system, financial markets and the economy during the Global Financial Crisis (bis.org, 2010). The Committee
introduced a number of measures which focus on procyclicality and increase the resistance of the banking sector. These measures will help ensure that
the banking sector absorbs shocks instead of transmitting them to the financial system and the economy. One

Case Study Analysis : Company 's Financial Wealth And...
Toghrul Khalafov A4080865 togrul.khalafov@gmail.com Risk Management Report Bluehill Bank Written Coursework Assignment Ratio analysis is
the best way of analysing the company's financial wealth and position. It helps to understand the crucial financial figures of an entity pointing to weak
and possibly risky parts of its finance. Using the results of the analysis managers can strengthen the financial position by determining and eliminating
possible risks related to credits, operations and market fluctuations. One of the important cases that a company cares about is profitability.
Undoubtedly it plays a great role in the overall performance of an entity and define the actions must be made to improve it. Being on of the indicators
of profitability net margin indicates how well companies can convert their revenue into profit. According to the chart that shows changes over the
period of 2008–2011 for three banks, Bluehill , HSBC and Deutsche, Bluehill Bank has a downward trend of net margin changes,from 36% in 2008 to
28.7% in 2011. Though there was a significant increase in revenues, impairment loses on loans and tax payments were increased enormously as well.
That is why the net margin declined over the period but still remained the best among competitors that have only 20%,HSBC, and 12.44%, Deutsche
Bank. In addition, the higher this ratio can be the better it will be for the entity. As a solution in this case managers should focus on impairment losses on

Financial Institutions Management Sample Examination
FIN3FIM Financial Institutions Management Sample Examination Solutions
FIN3FIM Financial Institutions Management
1
Sample Examination 3
The following information, and Questions 1, 2 and 3 below, relate to Chartwell Banking Corporation for the year ending 31 December 2007.
Profit and Loss Statement for the period 1 January to 31 December 2007 $m 48.0 12.0 60.0 31.0 17.0 48.0 12.0 4.2 7.8
Interest Revenue Non–interest Revenue Total Operating Revenue Interest Expense Non–interest Expense Total Operating Expenses Operating Profit
before Tax Income Tax (35%) Operating Profit after Tax
Balance Sheet as at 31 December 2007
Assets Cash Treasury Notes Commercial Paper Certificates of Deposit Treasury Bonds Corporate Bonds... Show more content on Helpwriting.net ...
The total amount of capital required is equal to: 1046.45 Г— 8% = $83.716 million.
FIN3FIM Financial Institutions Management 4 Sample Examination 3
Question 2 (a) Calculate the following ratios for Chartwell Banking Corporation. (i) (ii) (iii) Interest Margin Net Margin (after tax) Asset Utilisation (iv)
(v) (vi) Return on Assets Leverage Multiplier Return on Equity
Interest Margin Net Margin Asset utilisation Return on

Financial Crisis Evolution Of Bank Capital
TABLE OF CONTENT:
Introduction 2
Defining Bank Capital 2
Measure of Bank Capital
How Capital Absorbs Risk 2–4
Covers Credit Risk
Prevents Liquidity Problems
Manages Operational Risk
Restricts banks from taking excessive risk
Manipulation of Capital Standards 4–7
Quality of Capital Resources
Internal Rating Based (IRB) approach under Basel–II
Securitization
Credit Derivatives ... Show more content on Helpwriting.net ...
Capital in banks play an essential role of helping banks remain solvent by absorbing losses caused due to stress conditions. In this paper, we shall
analyse how capital helps banks manage their risk, what led to banks failing during the financial crisis and what measures have been adopted to avoid
(or better manage) such situations in future.
DEFINING BANK CAPITAL
Banks' capital is defined to be the difference between the assets and liabilities of a bank.
It is the net worth of the bank or its value to investors. It is stated along the liabilities side of the balance sheet.
Main characteristics of bank capital
No contractual repayment requirements: Unlike other liabilities, bank capital is perpetual. As long as bank continues to be in business, it is not obliged
to repay the shareholders.
Low priority in case of bankruptcy: In case of insolvency or bankruptcy, capital investors only receive what remains after paying all the creditors.
Capital generally ranks low in case of claims as compared to most of the other claimants.
Constituents of bank capital

Tier 1 Capital also known as core capital includes permanent shareholders' equity and disclosed reserves.
Tier 2 Capital (supplementary capital) includes undisclosed reserves, revaluation reserves, general provisions, hybrid capital instruments and
subordinate term debt subject to certain conditions.

The Global Financial Crisis
The global financial crisis has raised many concerns for the need to restructure the approach of risk and regulation in the financial sector (KPMG
2011). Figure. 4 has shown the structures of Basel III. It aims to increase the capital and liquidity of banks and therefore maintaining the stability in
banking sector with full effect in 2019 (Banks For International Settlements 2011).
EUROPE – Preparedness
On 26 June of 2013, Capital requirement regulation (CRR) and directive(CRD) has been adopted for Basel III in Europe. Basel III permits the capital
buffer increase gradually to 2.5% in 2019 (Banks For International Settlements 2011). There is minor deviation in adapting this approach in Europe.
Given that small institution may adapt Basel ... Show more content on Helpwriting.net ...
Secondly, banks will have a more accurate estimate of liquidity by doing "cash–flow forecasts and portfolio analysis"(Philipp et al. 2010, p. 16). By
having a better understanding, banks can then adjust their asset to "adjust their short–term asset and liability structure"(Philipp et al. 2010, p. 16) to
ensure they can fulfill the new capital requirement. More specifically, taking BNP Paribas as an example, it cuts dividend to increase retained earning
to boost CET1 capital and sell impair Greek sovereign debt to reduce risk weighted asset (Yuting et al. 2012).
From our point of view, banks are all computing different strategies regarding on their own company–specific risk. However, it is common for banks to
cut dividends in order to meet the CET1 requirement (Yuting et al. 2012), which deteriorate shareholders' interest.
Potential Challenges: (1) Capital stress (2) Funding stress
For simpler explanation, four banks from Europe are selected namely, BNP Paribas, Banco Santander, DeutscheBank and Unicredit for comparison.
The European Banking Authority (EBA) requires banks to reach a Common Equity Tier 1 ratio of 9% by the end of June 2012" (P.15HECparis).
This period is shorter than the one set by Basel III. This imposes extra stress on banks to increase their liquidity within a short time. Furthermore,
EBA has also decided a Stress Test in 2011 based on the RWAs, CET1 and buffer. Compared to other banks, Banco Santander in Spain would have the
largest shortfall of

Disadvantages Of Single Rulebook
2.1.5 Single Rulebook
The single rulebook gives support to the banking union and it is important to the financial sector regulation in the EU in general. It consists of legal acts
that all financial institutions in the EU must follow. The single rulebook, among other things:
highlights capital requirements for banks
makes better protection for depositors
regulates the prevention and management of bank failures
The single rulebook is based on pillars– the rules are most important for the banking union – are:
capital requirements directive IV (CRD IV) and capital requirements regulation (CRR)
amended directive on deposit guarantee schemes (DGS)
bank recovery and resolution directive (BRRD) (http://www.consilium.europa.eu/en/policies/banking–union/single–rulebook/)
The Capital Requirements Directive IV (CRD IV)
This directive as part of the Basel III requirements is passed into member states' national law, stating the guidelines on ... Show more content on
Helpwriting.net ...
The risk–weighted assets refer to safer assets are attributed a lower allocation of capital, while riskier assets are given a higher risk–weight. Moreover,
the riskier the assets, the more capital the bank has to set aside. The capital is assigned certain grades according to its quality and risk. Tier 1 capital is
considered to be the going concern capital. The going concern capital allows a bank to continue its activities and keep it solvent. The highest quality
of Tier 1 capital is called common equity tier 1 (CET1) capital. Tier 2 capital is considered to be gone concern capital. The gone concern capital
permits an establishment to repay depositors and senior creditors if a bank became insolvent. A minimum total capital ratio that banks and investment
firms are required to hold should be equal to at least 8%.

Key Elements For The Basel IIi Capital Adequacy Framework
1.Introduction
In the aftermath of the financial crisis of 2007 – 2009, the Basel Committee of Banking Supervision launched a program that substantially revised the
existing capital adequacy guidelines. As a result, the Committee released a new version of bank capital and liquidity standards, referred to as "Basel
III", in December 2010. Subsequent guidance was issued in January 2011 regarding minimum requirements for regulatory capital instruments. The G20
, including United States and the European Union, publicly endorsed the Basel III standards at their November 2010 Summit in Seoul, and relevant
countries around the world have made efforts to study its impacts on their banking industry and to find the best ways to implement them into law in
their respective jurisdictions. There have been numerous worldwide debates and discussions since its introduction. However, the core principle of more
stringent capital requirement has not been changed and it is now unavoidable for impacted financial institutions to comply with the new standards. The
purpose of this paper is to summarize the key elements for the Basel III capital adequacy framework and discuss its practical implications on the
financial industry.
2.Background of Basel Committee and Its Accords
The Basel Committee on Banking Supervision (BCBS) was originated from the collapse of the Bretton Woods system in 1973 that was followed by
the financial market turmoil. The failure of Bretton Woods caused large foreign

Essay about finance
Introduction
In this report, I will analyze the financial performance of SDB by comparing it with its industry peers. SDB's asset quality, earnings capability and
capital adequacy are the three aspects I will pay attention to when evaluate its financial performance. Then I will discuss whether it is appropriate for
Newbridge to pay 1.6 times book value for 18% shares in SDB. And what is appropriate range for the price Newbridge can offer. The objective of this
report it to assist Newbridge to make right decisions on whether to invest SDB or not and if invest what is appropriate price to pay for each share.
Part 1 SDB' financial performance
In order to analyze the financial performance of SDB, there are three aspects we ... Show more content on Helpwriting.net ...
Large amount of NPL may also on the other hand provide higher interest revenue for SDB on the high–risk loan they made, so to determine its
financial performance we have to also consider its earnings capability.
Earnings capability
The key earnings measurements of SDB are ROAA (net income/average total assets) and ROAE (net income/average equity). ROAA is called return
on average asset. It is an indicator shows how much bank earns as a percentage of total assets. ROAE is an indicator for return on equity. And From
2000 to 2002, the SDB' s ROAA and ROAE are decreasing over time. Based on Exhibit 10 (Jin, Xuan, & Bai, 2009), the average ROAA for
industry peers is 0.6%, higher than SDB'S ROAA, which is 0.3%. The average ROAE for industry peers is 26.8%, which is much higher than
9.1% for SDB. These data shows SDB is not a profitable bank as the profitability of both bank's total assets and average equity are lower than
industry peers. Moreover, the overall financial performance of SDB is worse compare with its industry peers. This is because not only the ROAA
and ROAE are lower than other banks but also other measure of firm earning capability are performing poor than industry peers. For example, the
Operating expense/Operating income ratio for average industry peers is 55.3% and for SDB is 58.3% (Jin, Xuan, & Bai, 2009). Which means for
every operating income SDB generated, it has to spend more than others.
There

The Effects of Bank Regulation on the Relationship Between...
Comparative Economic Studies, 2015, (31–54) © 2015 ACES. All rights reserved. 0888–7233/15 www.palgrave–journals.com/ces/ Survey Article The
Effects of Bank Regulation on the Relationship Between Capital and Risk ALESSANDRA TANDA Department of Economics, Management and
Quantitative Methods, UniversitГ degli Studi di Milano, Via Conservatorio, 7, Milan 20122, Italy. E–mail: alessandra.tanda@unimi.it Capital
regulation acts as an external force in the determination of bank capital and risk levels. Changes in the regulatory framework can inп¬‚uence banks'
decisions. Starting from the debate of the prudential regulation after the п¬Ѓnancial crisis, this paper reviews the main empirical contributions on the
role of capital... Show more content on Helpwriting.net ...
THE EFFECTIVENESS OF THE BASEL REGULATORY FRAMEWORK ON BANK CAPITAL Bank activity is characterized by asymmetric
information. Depositors cannot monitor the quality of banks' assets and doubts on the solvency of banks might lead to panic and 'bank runs'
(Llewellyn, 1999). If this should occur, depositors will be induced to withdraw their savings, causing a liquidity crisis for the bank that can potentially
lead to the failure of the intermediary. Moreover, doubts regarding the solvency of one bank can create worries about Comparative Economic Studies
A Tanda Capital Regulation and Banks' Behavior 33 the solvency of other banks, leading to a generalized panic. Bank runs are considered as extreme
events that are potentially highly disruptive. This was demonstrated during the latest п¬Ѓnancial crisis, when banks faced the threat of a bank run, not
only by depositors, but also by institutional investors. In fact, following the 2007–2008 crisis, the interbank market almost dried up, suggesting that
bank runs may move from the retail to the wholesale market. To prevent bank runs and their effects, governments usually create implicit or explicit
guarantees to protect depositors (for a concise review see Allen et al., 2009). Deposit insurance schemes however might produce unwanted effects and
increase moral hazard because they can induce banks to take higher risks.1 Prudential authorities enforce capital regulation2 in order to limit bank

Camel Rating in Banking
THE CAMEL RATING SYSTEM IN BANKING SUPERVISION A CASE STUDY
Uyen Dang
Arcada University of Applied Sciences International Business 2011
DEGREE THESIS Arcada Degree Programme: Identification number: Author: Title: Supervisor (Arcada): Commissioned by: Abstract:
International Business 10312 Uyen Dang The CAMEL rating system in banking supervision. A case study Andreas Stenius
Banking supervision has been increasingly concerned due to significant loan losses and bank failures from the 1980s till now. In the light of the
banking crisis in recent years worldwide, CAMEL is a useful tool to examine the safety and soundness of banks, and help mitigate the potential risks
which may lead to bank failures. The research has been ... Show more content on Helpwriting.net ...
21 2.3.5 Earning ability ............................................................................................. 22 2.3.6 Liquidity
....................................................................................................... 23 2.4 2.5 3 Composite rating and exposure limit
............................................................... 25 The significance of CAMEL rating framework in banking supervision ......... 26
CASE STUDY– APPLYING THE CAMEL FRAMEWORK IN ANALYZING
BANK X AT AMERICAN INTERNATIONAL ASSURANCE (AIA) VIETNAM ...
................................................................................................................................. 28 3.1 3.2 AIA Vietnam profile
........................................................................................ 28 The CAMEL approach to bank analysis on Bank X........................................ 28
3.2.1 Bank X's Capital Adequacy ......................................................................... 29 3.2.2 Bank X's Asset Quality
................................................................................. 30 3.2.3 Bank X's Management ................................................................................. 31 3.2.4 Bank
X's Earning ......................................................................................... 32 3.2.5 Bank X's Liquidity

Regional Land Revenue System Of Colonial India
Term Paper for the Course:
Regional Land revenue system in colonial India
Submitted by
Rammilan Singh Yadav
Registration No. 67259
Centre for Economic Studies and Planning
Jawaharlal Nehru University New Delhi
1.Introduction
After the breakdown of Bretton woods system of managed exchange rates in 1973 many banks incurred large foreign currency losses. on 26june 1974
so many banks had released payments of dutsche marks which was German currency at that time in Frankfurt for exchange of US dollar that was to be
delivered in US New York. Due to time difference herstatt stop doing operation between the times of respective payments. Responding to herstatt
debacle the G–10 countries, Spain and Luxemburg formed a standing committee for in 1974 under the bank for international settlements (BIS) known
as basel committee on banking supervision because headquarter of BIS is in Basel so this committee got its name from there. The committee
comprises representative from central banks of different countries and their regulatory authorities
2.Basel 1
The Basel committee on banking supervision (BCBS) in 1998 published a set of minimum capital requirement for banks. It focused entirely on credit
risk or default risk, these were known as Basel 1. Basel 1 defined capital requirement and structure of risk weights for banks. Under Basel1 assets of
banks were classified in five categories according to credit risk carrying risk weights of 0, 10, 20, 50, and 100 percent and no

Essay about Financial Analysis of Anz and Nab
|–– |
|[Financial Analysis of ANZ and NAB |
| Group Assignment |
| |
| |
| |
| ... Show more content on Helpwriting.net ...
However, a lower P/E ratio can also be generated with one–off abnormal earnings (Phan, 2011).
In 2008, share prices dropped mainly due to the US sub–prime crisis, which started in 2007 (Lixi, 2008). This had a huge impact on the P/E ratio for
2008, which is slightly below the threshold of 10 times. The P/E ratio for ANZ was higher than NAB in 2009 and there was lesser fluctuation in
ratio. Share prices tend to rise with improved economic conditions, and with stimulus packages being distributed all over the world, there was uplift
in the global economy, hence driving share prices (Larsen, 2012). However, falling earnings over 2009 caused both P/E ratios to rise. NAB's P/E
ratio increased a significant amount and overtook ANZ's. Over the 5 years, NAB's P/E ratio fluctuation is observed to be consistently higher than
ANZ's. Moreover, NAB's higher P/E ratio might be due to investors' high expectations, which were not supported by earnings.
The P/E ratios returned to a more normal course in 2010 due to improved earnings (See Appendices 1). In 2011, earnings were higher than in 2010
but the drop in market share price caused P/E ratio to decrease again. This drop might be linked to concerns over the uncertainties around sovereign
debt in Europe.
2) Return on Equity (ROE)
According to Forbes,

Balance Sheet and Total Capital Ratio Essay
1гЂЃ(1) What are the primary line items within Citigroup's balance sheet and income statement?
Balance Sheet
Asset
Cash and due from banks
Deposits with banks
Federal funds sold and securities borrowed or purchased under agreements to resell
Trading account assets
Investments
Total loans, net
Liability
Total deposits
Short–term borrowings
Long–term debt
Equity
Common stock
Additional paid–in capital
Retained earnings
Income Statement
Income
Total revenue
Total provisions
Total operating expenses
Net income These are primary line items because of they are either great in amount or great in significance (Referred to as key performance indicators).
1гЂЃ(2) Using the balance sheet as a reference, what happens during ... Show more content on Helpwriting.net ...
Accordingly, banking regulators assessed minimum values for each of these key measures. At 2007, "adequately capitalized" (i.e., minimum) levels
were 4% for the Tier 1 capital ratio, 8% for the total capital ratio, and 3% for the leverage ratio; "well capitalized" levels were 6% for Tier 1 capital,

10% for total capital, and 5% for leverage. Well capitalized banks qualified for, among other things, lower premiums assessed by the Federal Deposit
Insurance Corporation (FDIC). Undercapitalized banks (e.g., below the 8% minimum required total capital) received a warning from the FDIC;
continued violation of capital requirements triggered further regulatory costs, including intervention or (in the extreme) takeover by government
regulators.
2гЂЃ(2) Using Citigroup as an example, estimate the major calculations underlying its 2007 Tier 1 Capital ratio.
Calculation: Tier 1 Capital Ratio= 89,226(Total Tier 1 Capital)/1,235,321(Risk Adjusted Assets) =7.12%
3гЂЃDescribe the relevant provisions of fair value accounting under SFAS 157(ASC 820). What does a measure like net income mean as a firm
moves towards increasing use of fair value accounting (as opposed to historical cost of assets)? The changing nature of business from cost–bases assets
and liabilities to more market–oriented assets and liabilities drove the move towards increasing use of fair value accounting. Under the momentum, a
measure like net income

Essay on analysis of SDB
1.0 Abstract
This report aims to provide an analysis of a proposed investment in Shenzhen Development Bank (SDB) by Newbridge in 2002 and assess whether the
P/B ratio of 1.6 for Newbridge to pay for its 18% stake in SDB is appropriate. The analysis of Newbridge's acquisition of SDB's stocks is based on
several aspects of SDB's asset quality, earnings capability and capital adequacy. According to price–to–book ratio of SDB's industry peers and some
acquisition precedents by foreign investors, Newbridge made a correct decision that it paid 1.6 times book value of SDB's stake on a basis of SDB's
performance. This is because of SDB's high P/B ratio and low ROE indicating that SDB's share price was overvalued; therefore, Newbridge's ... Show
more content on Helpwriting.net ...
This indicates that SDB's ability of making profits is stronger than the average level. Meanwhile, SDB's non–interest income level and operating
expense were above the average level in 2002. Nevertheless, SDB's ROAA was 0.9% in 2000 and was only 0.3% in 2002. This ratio was merely half
of the average ROAA of other five joint–stock banks in 2002 indicating that SDB's profitability of the assets was relatively weak as well as its ROAE
at the same time. SDB's ROAE was only one–third of the average ROAE of five joint–stock banks. Therefore, SDB's performance was not good
compared with its industry peers; the reason of SDB's bad performance is that an increasing assets generating low net income.
3.3 Capital adequacy
In commercial banking, capital adequacy ratio (CAR) is used to monitor a bank's situation of capitalization by regulators and managers. CAR is
calculated as the sum of tier 1 capital (equity and retained earnings) and tier 2 capital (subordinated debt and reserves) and dividing it by its
risk–weighted assets. SDB's CAR decreased from 10.6% in December 2001 to 9.5% in December in 2002, but still above the Chinese regulatory
floor of 8%. It is particularly worth mentioning here that SBD's CAR was 0.7% higher than the average CAR of other five joint–stock banks in 2002.
Not all the time the CAR is good if high; a high CAR means that a bank's large amount of money is stuck in

Hsbc Bank Swot Analysis
HSBC bank is the leading banking service provider in the United Kingdom and is regarded as the largest banking and financial service
organisation in the world. The international network of the bank consists of 7500 offices in about 80 countries. The headquarters of the bank is
located in London and operates in about 1800 sites. The aim of this paper is to provide critical evaluation of the performance and management of
HSBC from last 5 years. Moreover, the SWOT and PEST analysis are used as the qualitative tool for analysing the position and performance of the
bank. On the basis of this evaluation, the position and condition of the bank for next 5 years is evaluated. Financial Position of HSBC It is noticed
from the financial statements of the company that the financial position of HSBC is not very much stable and they are facing difficulties within their
performance. The operating income of the bank is very fluctuating, which means that the organisation does have control over their expenses in relation
to sales. The bank earned highest operating income in 2011 which declined massively that is by 48.9% in next year. This decrease in the operating
income was very dreadful for the bank because it became essential for them to gain their position so that worth can be maintained with same pace.
However, the... Show more content on Helpwriting.net ...
For that reason, it is imperative from the prospect of top officials of HSBC bank to consider this technique in order to assess the overall internal
environment of their business. However, with the help of proper internal assessment of business operations HSBC can easily manage their business
activities that would help them to remain stable in the era of strong competition (Camillo, 2015). Moreover, SWOT stands for Strength, Weaknesses,
Opportunities, and Threats that are demonstrated below from the HSBC perspective (Ryan,

Economics Of Banking Chapter Summary
H.Keiding: Economics of Banking (Prel.version:September 2013) Chapter 18, page 1 Chapter 18 Capital Regulation and The Basel Accords 1.
Introduction: why capital regulation? 2. Eп¬Ђects of capital regulation 2.2. A model where banks have equity in excess of regulatory demand. There
is some empirical evidence that banks choose a composition of funding where the share of equity is larger than what is demanded by regulators.
Below we consider a simple model of largely competitive п¬Ѓnancial markets, due to Allen, Carletti and Marquez (2011), where this is the case. We
consider a one–period economy with п¬Ѓrms having access to a risky investment and in need of п¬Ѓnancing, and banks that lend to the investors and
monitor them. An investment... Show more content on Helpwriting.net ...
If this is a result of market forces, it must be a market where all bargaining power is left with the borrowers, none with the banks. Therefore, it may
be questioned whether the result can be seen as a decision by banks to hold more than the minimal capital required. If instead we introduce a regulator,
determining k so as to maximize a social welfare function deп¬Ѓned as we get that rL в‰Ґ 2 в€’ k, and inserting this into (1) we get that k в‰
Ґ 1 1 B
+ О = q(y в€’ rL ) + q(rL в€’ (1 в€’ k)rD ) в€’ krE в€’ q2 = q(y в€’ (1 в€’ k)rD ) в€’ krE в€’ q2 , 2 2 while otherwise everything is as before, then fo
large enough y (namely y в‰Ґ 2, the capital ratio k may be chosen as 0, since the banks' gain with rE = 2 is large enough to give incentives for q = 1.
If y < 2, the capital ratio must be positive, whereas q may be less than 1. H.Keiding: Economics of Banking (Prel.version:September 2013) Chapter
18, page 3 2.3. A model where capital regulation may increase risk. To see that capital regulation may work in ways that run counter to intuition, we
look at a simple model proposed by Hakenes and Schnabel (2010). It is in many respects close to the one which we used in the discussion of
competition and risk (Chapter 11). We assume that there are N banks which are п¬Ѓnanced either by deposits D j or by equity E j , j = 1, . . . , N. The
banks compete for depositors and for loans. Borrowers are entrepreneurs, who may choose risky projects, all of equal size 1, characterized

Evaluating Basel
END TERM PROJECT
COMMERCIAL BANK MANAGEMENT
TOPIC 5
BANK CAPITAL MANAGEMENT– CAPITAL ADEQUACY FRAMEWORK
Submitted to:
Submitted by: Group 5
Prof. D.N. Panigrahi
Abhishek Singh (2014013)
Anisha jain (2014042)
Bakul Malik (2014072)
Gurusha Godwani (2014100)
Ketki Chaturvedi (2014133)
CHAPTER 1
BANK CAPITAL MANAGEMENT– CAPITAL ADEQUACY FRAMEWORK
INTRODUCTION
Bank capital is often defined in tiers or categories that include shareholders' equity, retained earnings, reserves, hybrid capital instruments, and
subordinated term debt. Capital ratios are commonly measured as a percent of bank assets or risk–weighted bank assets.
Bank capital serves as an important cushion against unexpected losses. It creates a strong ... Show more content on Helpwriting.net ...
Banks list their capital adequacy ratios in their financial reports. The CAR is important to shareholders because it is an important measure of the
financial soundness of a bank.

Two types of capital are measured with the CAR. The first, tier 1 capital, can absorb a reasonable amount of loss without forcing the bank to cease its
trading. The second type, tier 2 capital, can sustain loss in the event of liquidation. Tier 2 capital provides less protection to its depositors.
Because of the nature of risk under which banks operate, capital regulations require banks to maintain a minimum level of equity per loans and other
assets. This required minimum is designed for protection, allowing banks to sustain unanticipated losses. The minimum is also designed to offer
depositors confidence in the security of their deposits given the asymmetric information.
An individual depositor cannot know if a bank has taken risks beyond what it can absorb.
Thus, depositors receive a level of assurance from shareholders' equity, along with regulations, audits and credit ratings.
The amount of equity a bank receives from shareholders sets the limit on the value of deposits it can attract. This also limits the extent to which the
bank can lend money. If a bank sustains large losses through credit or trading, eroding the bank's net worth, this causes a decreased fund base through
which a bank can offer loans.
The CAR provides

Bank Treasury
There was a general increase in the Bank's portfolio of both assets and liabilities for the year ending December 31, 2010 when compared to the
previous comparative period. This was mainly attributed to increases in the Bank's loans and advances, investment securities and customer deposits.
Assets for the year ending December 31, 2010 increased by $240,359 (29.22%) when compared to the previous year and this was primarily due to
increases in Loans and Advance and Investment Securities which were $127,732 (29.41%) and $101,654 (39.97%) respectively. Although there was an
increase in the Loans and Advance figure, General Loan Loss Reserve also increased by $1,261 (63.40%). Included in the Investment Securities are
USD investments totaling ... Show more content on Helpwriting.net ...
Core capital is way above the obligatory 50% however there has been a decrease from 27.50% in 2009 to 25.06% in 2010. This position is still way
within the required margin but ALCO should continue to monitor this on an ongoing basis.
Scenario 3 – March 9th, 2011
The Central Bank has just advised of that they will be floating a new 20 year bond (GOTT 2031 Fixed Rate, Coupon 6.25%) for the completion of the
Solomon Hochoy highway extension project. Total issue size is TTD1 billion.
Suggestion
The Bank's investment portfolio as at December 31, 2010 includes a 20 year gov't fixed rate bond, coupon 5.875% that has 17 years remaining to
maturity. This bond would have been purchased at a discount which means that the yield to maturity would be more than 5.875%. On March 09,
2011 the bond had a coupon rate of 6.60% and a market price of $106.92, therefore the market value of the portfolio would have been improved.
Based on a comparison of the government yield curve, there was an upward trend, which suggests that return on the portfolio would be increased upon
maturity. The new gov't instrument had a coupon rate of 6.80% as at March 09, 2011 and given the upward rising of the yield curve, it appears that a
20 year tenor would also give an increased average market yield and therefore has the potential to increase the return on the total portfolio. Whilst the
security is government and the instrument is

Basel Capital Accord
ROLE OF CAPITAL IN SECURING A STRONG BANKING SYSTEM– THE IMPERATIVES OF BASEL III ACCORD Dr.T.V.Rao, M.Com.,Ph.D.,
CAIIB,ACIBS(UK), Professor, B.V.Raju Insitute of Technology, Narasapur, Medak Dt., Telangana State ABSTRACT:
The stability of the Financial System largely depends on the strength and resilience of the Banking System. Indian Banks which suffered from negative
capital adequacy, negative earnings and high NPAs in the Seventies and eighties are now on a robust footing thanks to the reforms brought about by the
Narasimham Committee I and II and on account of the strong resolve of the Govt. and the Reserve Bank of India. It is a matter of pride that the Indian
Banks have now become fully Basel II Compliant, and that they ... Show more content on Helpwriting.net ...
of Banks with CA above 10%| 5| 22| 24| | | | | TOTAL| 25| 25| 25|
PRIVATE SECTOR BANKS PERIOD| 1996| 2002| 2008| No. of Banks with negative CA|––| ––| ––| No. of Banks with CA of below 8%| 1| ––| ––|
No. of Banks with CA between 8–10%| 4| 1| 1| No. of Banks with CA above 10%| 10| 14| 14| | | | | TOTAL| 15| 15| 15|
FOREIGN BANKS PERIOD| 1996| 2002| 2008| No. of Banks with negative CA| ––| ––| ––| No. of Banks with CA of below 8%| 1| ––| ––| No. of
Banks with CA between 8–10%| 3| 1| ––| No. of Banks with CA above 10%| 5| 8| 9| | | | | TOTAL| 9| 9| 9|
POSITION OF SCHEDULED COMMERCIAL BANKS
PERIOD| 1996| 2002| 2008| No. of Banks with negative CA| 2| ––| ––| No. of Banks with CA of below 8%| 6| 1| ––| No. of Banks with CA between
8–10%| 21| 4 | 2| No. of Banks with CA above 10%| 20| 44| 47| | | | | TOTAL| 49| 49| 49|
The issue of lower capital adequacy had negative connotations both nationally and internationally. The Reserve Bank of India addressed this issue on
priority and convinced the Government of India to recapitalise the ailing Public Sector Banks. This process started even before the study period, and
by 1996 the no. of Banks with negative capital adequacy are 2 viz., Indian Bank and Vijaya Bank in the Public Sector, while there are no Banks

How The Financial System Has Continuously Since The First...
1 Introduction The financial system has continuously evolved since the first accord was written. The financial crisis has brought light to how
imperative it is to have a stringent but flexible set of accords. Since the period of 1993 to 2008, there has been a 12 fold increase in total assets held
by global systematic important banks while only a seven fold increase in the capital funding of these assets. Global systematic banks are banks whose
distress or failure could lead to severe repercussions to the overall financial market due to their size, complexity and the systemic interconnectedness.
Coupled with the increase in leverage there was also an erosion of the quality of the capital, throughout this period. The market lost confidence in the
banking institution, leading to a major contraction in liquidity available. This transmitted throughout the rest of the economy and only with the help of
a public bailout were the damages curtailed. The globalization and interconnectedness of the financial market has led to the phenomenal growth post
WW2. However with commerce taking place over a global scale, and the financial market connecting lenders and savers throughout the world there has
become an apparent need for oversight and regulation. The breakdown of the Bretton Wood exchange rate in 1973, caused banks to lose substantial
money through unsettled trades and foreign currency losses in the Herstatt risk fiasco. This led to the central banks of the G10 countries to establish

SunTrust Banks: Financial Analysis
[pic] [pic]
SunTrust Banks Financial Analysis
Florida Atlantic University
ACG 6315
TABLE OF CONTENTS
Introduction 3
Description of the Company 3–4
Economic and Industry Analysis 4–5
Competition 5–6
Financial Ratio Analysis 6–9 Capital Adequacy 6–7 Asset Quality 7 Management7–8 Earnings8 Liquidity 8 Sensitivity to Market Risk 9
Assumptions 9
Results of Analysis 9
Conclusion 10
References 11
Appendix 12
Introduction The banking industry has undergone major upheaval in recent years, largely due to the lingering recessionary environment and increased
regulatory environment. Many banks have failed in the face of such tough environmental conditions. These conditions ... Show more content on
Helpwriting.net ...
"Insured institutions set aside $19.5 billion in provisions for loan losses in the fourth quarter, a decline of $13.1 billion (40.1 percent) from fourth
quarter 2010." (FDIC Quarterly, p.1) Unfortunately, the improvements in earnings and loan losses have not extended to Banks' operating revenues.
Banks' operating revenues are not growing due to "lower servicing income (down $8 billion), reduced gains on loan sales (down $4.8 billion), and
lower income from service charges on deposit accounts, which fell by $2.1 billion (5.9 percent)." (FDIC Quarterly, p.2)
Also, while the industry's noncurrent loans and loan losses continue to fall, they still remain well above pre–crisis levels.
Competition Competition is quickly encroaching on SunTrust's territory. The financial crisis helped rivals gain more presence in SunTrust's core

markets through key acquisitions. BB&T bank, one of SunTrust's main competitors, recently increased its presence with its acquisition of
Florida–based BankAtlantic. This acquisition increased BB&T's deposit market share to 6th in the Miami market. (BB&T Corporate Profile) BB&T
Corporation (NYSE: BBT), headquartered in Winston–Salem, N.C., has many similarities to Atlanta's SunTrust Banks. Besides both banks being
headquartered in the South, BB&T is similar in size with $174.8 billion in assets and approximately 1,800 financial centers. BB&T also operates
within a similar footprint and

Critical Analysis
Sheri Ebner
Professor Shelton
A321
–––––––––––––––––––––––––––––––––––––––––––––––––
06 June 2015
Week 1 Assignment 3: Critical Analysis
Part One
Title: Marketing to Children: Accepting Responsibility
Author: Gael O'Brien
Link: http://business–ethics.com/2011/05/31/1441–marketing–to–children–accepting–responsibility/ This article highlights the many issues of
marketing to children, especially in the fast food department. Specifically, this article talks about the issue of obesity and McDonalds, which is one
of the world's largest fast food chains. As of late, cities like San Francisco is voting to ban selling toys with fast food for children, especially when it
exceeds levels of salt, fat, calories, and sugar. ... Show more content on Helpwriting.net ...
It all comes down to personal choice, as the CEO originally stated. Sure, McDonald's should have some responsibility, but they have done that by
changing some of the food choices in Happy Meals. The rest is up to the parents.
Part Two
Calculating Capital Adequacy Standards a. Define Capital Adequacy Standards
Percentage ratio of a financial institution's primary capital to its assets (loans and investments, used as a measure of its financial strength and stability.
According to the Capital Adequacy Standard set by Bank for International Settlements (BIS), banks must have a primary capital base equal at least to
eight percent of their assets: a bank that lends 12 dollars for every dollar of its capital is within the prescribed limits (BusinessDictionary.com).
b. Define Tier 1 & Tier 2
"Tier 1 capital is composed of common equity plus trust–preferred securities minus intangible assets. Tier 2 capital is a bank's loan–loss reserve
amount plus other qualifying securities (e.g. subordinated debt and preferred stock) plus net unrealized gains on marketable securities. Total capital is

the sum of Tier 1 and Tier 2 capital" (Melicher and Norton).
c. Explain the International Implications of CAS
The central banks and other national supervisory authorities of major industrialized countries met

What Changes That Life Insurance Companies Will Face...
This report provides an analysis and illustration on the important changes that life insurance companies will face in capital management practices with
the implement of the new capital regime, publicly known as Life Insurance Capital Adequacy Test (LICAT). The LICAT framework transformed to a
risk–based regime from the current model–based Minimum Continuing Capital and Surplus Requirements (MCCSR).
The Office of the Superintendent of Financial Institutions (OSFI) has published the finalized guideline of LICAT to be effective in 2018. The new
prudential framework represents an evolution in OSFI's regulatory expectation in capital management; it introduces material changes in the behavior of
the capital metric and the assessment of the financial conditions to better characterize each company's risk profiles. As a result, companies need to alter
their investment strategies to accommodate the changes.
Some of the key components in this report include the comparison between MCCSR and LICAT, the analysis on the new solvency metric and its
derivation, and the potential impact of LICAT on lifeinsurance companies.
Table of Contents
1.Introduction ........................................................................................3
2.Minimum Continuing Capital Surplus Requirements ........................................
3.LICAT 's New Solvency Metric .................................................................3
4.Credit Risk .......................................................................................................
4.1.Off–balance sheet activity
4.2.On–balance sheet

Building a Fortress Balance Sheet
erspective P
Insights for America's Business Leaders
Building A Fortress Balance Sheet:
Protect Your Bank's Financial Health While Positioning It For Growth
Executive Summary: – The Vauban Model– Current Market Overview – Stress Testing and the Fortress Balance Sheet – Capital–Raising Strategies
"Ultimately, market participants themselves must address the fundamental sources of financial strains – through deleveraging, raising new capital and
improving risk management."1 – Ben Bernanke
The Vauban Model
Throughout the remainder of the year, banks' capital needs will accelerate as credit losses are expected to continue, despite easing monetary policies
and government intervention. To weather the turbulence in an economy that ... Show more content on Helpwriting.net ...
And don't be alarmed if we continue to see more of this as the market tries to find a floor on valuations. Faced with this situation, you and your
management team should take steps to raise capital now if there is a projected capital need. After all, there is no guarantee that market conditions are
going to improve in the short term, and they could just as easily erode further.
3
"Our primary concern right now – my primary concern – is the stability of our financial system, the orderliness of the markets, and that's where our
focus is."3 – Henry Paulson, Secretary of the Treasury
Play Strong Defense
In anticipation of that other shoe dropping and the additional credit stress that could ensue, consider the following strategies and start building an
unassailable defensive position.

Stress Test YourAsset Classes
Stress testing is a pre–emptive risk management process designed to help determine the impact of charge–offs against your current capital levels and
the amount of capital you'll need to fill the holes caused by lost earnings. This scenario planning enables you to project peak potential losses by asset
type within a specified geography over a defined time horizon. Typically, analytics are applied against a range of potential situations:
Estimated Peak Losses: Expected 2008 Charge–off Rates ($MM)
Asset Class 1–4 Family mortgages Estimated

Questions on Market Risk
Dr. Sudhakar Raju
FN 6700
ASSIGNMENT 4 – QUESTIONS ON MARKET RISK (VALUE AT RISK)
1.What is meant by market risk?
2.Why is the measurement of market risk important to the manager of a financial institution?
3.What is meant by daily earnings at risk (DEAR)? What are the three measurable components? What is the price volatility component?
4.Follow bank has a $1 million position in a five–year, zero–coupon bond with a face value of $1,402,552. The bond is trading at a yield to maturity of
7.00 percent. The historical mean change in daily yields is 0.0 percent, and the standard deviation is 12 basis points.
a.What is the modified duration of the bond?
b.What is the maximum adverse ... Show more content on Helpwriting.net ...
15.What are the advantages of using the Back Simulation (Historical Simulation) approach to estimate market risk? Explain how this approach would
be implemented.
16.Export Bank has a trading position in Japanese Yen and Swiss Francs. At the close of business, the bank had ВҐ300,000,000 and SF 10,000,000.
The exchange rates for the most recent six days (Day 0 being today) are given below:
DAY 012345
Japanese Yen112.13112.84112.14115.05116.35116.32 Swiss Francs1.41401.41751.41331.42171.41571.4123

a.What is the foreign exchange (FX) position in dollar equivalents using the FX rates on Day 0 (today)?
b.What is the definition of delta as it relates to the FX position?
c.What is the sensitivity of each FX position; that is, what is the value of delta for each currency today?
d.Assume that you have data for the 500 trading days preceding today. Explain how you would identify the worst–case scenario with a 95 percent
degree of confidence?
e.Explain how the five percent value at risk (VAR) position would be interpreted for business tomorrow?
17.What is the primary disadvantage to the historical (back) simulation approach in measuring market risk? What affect does the inclusion of more
observation days have as a

Jp Morgan and Dodd-Frank Act
Q. 1. What were the major factors that led to the recent financial crisis? How did we get here? Answer: One of the primary factors that can be
attributed as to have led the recent financial crisis is the financial deregulation allowing financial institutions a lot of freedom in the way they operated.
The manifestation of this was seen in the form of: a) Financial innovations that were not backed up with adequate risk controls and management. b) Too
much reliance on Quantitative Risk Management ultimately leading to mispricing of risk across different financial and non–financial investments that
were the product of the financial innovations made feasible by financial deregulation. c) The influx of liquidity both original ... Show more content on
Helpwriting.net ...
Answer:
The Glass–Steagall Act of 1933 that defined the roles for commercial banks, investments banks and insurance firms was over ridden by the
Gramm–Leach–Bliley Act (1999) which repealed the provisions that restricted affiliations in financial institutions. Hence one solution is to overcome
the incentive problem and the conflict of interests that arise when financial institutions simultaneously undertake financial activities of varied nature.
In addition to the above the internal incentive to bank should be reduced by requiring greater capital requirements as well as improving upon the
definition of what qualifies to be capital. Further in line with the answer to question 3, risk management systems in financial institutions need to be
redefined and strengthened to more comprehensively identify, evaluate, manage and monitor risks.
Yes we need to have some form of regulation. The proposed regulation is not bad as it covers most of the recommendations discussed in this write up
earlier. It reinforces the regulatory role as outlined earlier and requires improving the capital requirements as well as the risk management systems in
place in financial institutions. At the same time the focus is mostly on large, complex financial institutions that have a systematic impact so it allows
some flexibility particularly for smaller and medium size financial institutions.
As for as the key points to consider, the regulation that is

Executive Summary And Analysis
Keeping in mind the end goal to enhance the current examination design, the Staff Selection Board (SSC) has as of late reported to delay the
Combined Graduate Level Examination (CGL) that was to be hung on May 8 and May 22, 2016.Additionally, the commission prior declared to lead
the Tier 2 examination on August 13 and 14,2016. In the interim, this choice of the commission has given more opportunity to the understudies to get
ready well for the Tier I exam.
As indicated by the official notice, the examination for different posts will now be held in the month of August. Till now, no official dates have been
pronounced. According to source, this choice has been taken remembering the enthusiasm of the competitors showing up for the examination.
Additionally, the commission is wanting to roll out couple of improvements like area cut–off, qualifying nature among others. All the applicants are
asked for to keep a track on all most recent overhauls. For more subtle elements, applicants can visit the official site
Staff Selection Commission is an administration organization which is responsible for enlistment of unemployed applicants in various open divisions.
SSC occupations 2016 are all the more frequently diverse posts in various pastors of India. Staff Selection Commission enlistment is generally of
Group D occupations in different clergymen and bureaus of Indian Government. Most recent SSC Govt Jobs 2016 are monstrous in India as it shows an
immaculate chance for Employment

Risk Management Cw1
RISK MANAGEMENT AND INTERNATIONAL INVESTMENT REPORT OF MARYLEBONE BANK
BFBL606.2 Risk Management and International Finance
Tho Cam Vu
Student ID: 13486903
Date: 30th May 2014
Word Count: 3,413
Student ID: 13486903
Date: 30th May 2014
Word Count: 3,413
ABSTRACT
Marylebone Bank is an UK–based bank and had certain investments within the country and international. Marylebone Bank is currently holdings
investments in five FTSE companies in banking industry, also holdings certain assets of cash and equity. The report sets the bank's capital requirement
with the requirement of Basel Accords in order to build up sustainable positive capital frequently to avoid losses, liabilities and liquidity. Firstly, the
report analyzes the risk ... Show more content on Helpwriting.net ...
Operational Risk12 IV. The Capital Requirement under different Basel Accords12 6. Under Basel 1(1988 BIS Accord)13 7. Under Basel 1(1996
Amendment)13 8. Under Basel 214 9. Under Basel 2.515 10. Under Basel 315 V. Conclusion17VI. References18
I. INTRODUCTION
As a risk manager of Marylebone Bank, the primary aim is making sure the bank's capital achieve an appropriate level to meet the obligations, be able
to pay off the risk–taking and bear the expense of unexpected losses. The Basel accord is applied as a guideline to maintain the risk rate to minimum,
avoiding financial clashes. The report examines variety of methods in order to estimate three key risk capital charges in financial institutional
management, which are market risk, credit risk and operational risk.
II. MARKET RISK CAPITAL CHARGE ESTIMATION
There are five companies have been chosen, all of them are in the banking industry and members of FTSE100. They are Barclays, HSBC, Lloyds

Banking, The Royal Bank of Scotland and Standard Chartered. All the historical adjusted close is collected from Yahoo! Finance. 1. Variance–
Covariance Method
The first method to be applied is Variance–Covariance method as to calculate the returns of each company in 500 financial days, in order to calculate
the covariance between the returns of two companies respectively. Combines with the value of assets, which are

Finance Questions and Answers
TUTORIAL 1 – TUTORIAL DISCUSSION QUESTIONS
2. (a) Discuss the role of money in a financial system.
money is a financial asset that facilitates financial and economic transactions
a medium of exchange–swapped for goods and services
a store of value–wealth is held or measured in money terms
a standard of deferred payment–used to record indebtedness
a unit of account–transactions are priced in money terms
currency is generally divisible, portable and durable
(b) Does money have to be currency? If not, what are some alternatives?
money is anything that is universally acceptable as a medium of exchange
further, money generally has the characteristics of being divisible and a store of value
examples: currency, ... Show more content on Helpwriting.net ...
Examples, commercial banks, building societies, credit unions
contractual savings institutions. Their liabilities (sources of funds) are contracts that generate periodic cash flows, such as insurance contracts and
superannuation savings. Their accumulated funds are used to purchase both real and financial assets. Includes insurance offices and superannuation
funds
finance companies. Provide loans mainly to small business and retail customers. Also provide lease finance. No depositors, therefore they borrow funds
in the money and capital markets to finance their activities
investment banks and merchant banks. Specialise in the provision of off–balance–sheet advisory services such as providing advice on mergers and
acquisitions, balance sheet structuring, risk management
unit trusts and managed funds. A unit trust is formed under a trust deed. Investors purchase units issued by the trustee. The trust invests in specificasset
classes (such as equity or property) within the terms of the trust deed
5. As an employee of the finance department of a corporation you are asked to explain the matching principle to an executive of the organisation. You
know that you will need to give practical examples. What are you going to advise the executive?

Matching principal:
short–term assets should be funded by short–term liabilities. Example, use a bank overdraft to finance the purchase of

Internship Report of Corporate Credit in Bank
CHAPTER I
INTRODUCTION
1.1 Background
Basel Capital accord is a capital adequacy framework developed by the Basel committee. In 1988, the Basel Committee decided to introduce a capital
measurement system commonly referred to as the Basel Capital Accord. This system provided for the implementation of a credit risk measurement
framework with a minimum capital requirement of 8% on banks Risk Weighted Assets (RWA). The 1988 framework is also known as "Basel– I".
Since 1988, this framework has been progressively introduced not only in member countries but also virtually in all other countries.
The "international convergence on capital measurement and capital standard –2004" is popularly known as Basel–II. It is a capital ... Show more content
on Helpwriting.net ...
The rationale of Basel II was to reduce the scope for regulatory arbitrage and make regulatory capital requirements more risk–sensitive by incorporating
advances made in banksвЂџ internal risk management practices in calculating regulatory capital requirements. The вЂћInternational Convergence of
Capital Measurement and Capital Standards: A revised FrameworkвЂџ, known as Basel II, was agreed in 2004 and consisted of three pillars
corresponding to minimum regulatory capital requirements in Pillar 1, the supervisory review process in Pillar 2 and market discipline in Pillar 3. 1.
First Pillar
The first pillar deals with maintenance of regulatory capital calculated for three major components of risk that a bank faces: credit risk, operational
risk, and market risk. Other risks are not considered fully quantifiable at this stage.
Credit Risk| Operational Risk| Market Risk| –Standardized Approach–Foundation IRB Approach–Advanced IRB Approach| –Basic Indicator
Approach– Standardized Approach–Advanced Measurement Approach| –Standardized Approach–Internal Model Approach|
2. Second Pillar
This is a regulatory response to the first pillar, giving regulators better 'tools' over those previously available. It also provides a framework for dealing
with systemic

Working Capital Financing and Credit Appraisal
I. EXECUTIVE SUMMARY The project brings out various aspects of working capital management and the means to get it financed from banks. It
starts with explanation of the concept of working capital, description of working capital cycle, management and financing of working capital. This is
supplemented by a brief explanation of the working capital financing of M/s Paras Organics Private Limited. It should be noted that business
transactions are generally carried on credit with a number of days elapsing subsequent to the sale being affected for realization of sale proceeds.
While part of the raw materials may be purchased on credit, the business would still need to pay its employees, meet manufacturing and selling
expenses such as wages,... Show more content on Helpwriting.net ...
Thus, Gross Working Capital = Total Current Assets. * Net Working Capital: It refers to the difference between current assets and current liabilities.
Current liabilities refer to those claims which are expected to mature for payment within an operating cycle and include creditors, bills payable,
outstanding expenses and bank overdraft. It can be positive or negative. A positive net working capital occurs when current assets exceed current
liabilities and a negative working capital occurs when current liabilities exceed current assets. Net Working Capital = Gross Working Capital or Current
Assets – Current Liabilities Net working capital can alternatively defined as that part of the current assets which are financed with long–term funds.
Now, let us have a look at some of the other interesting concepts of working capital: * Zero Working Capital: Zero Working Capital = Inventories +
Receivables – Payables. The rationale behind this concept is that inventories and receivables are the major constituents of current assets which affect
sales. Further, suppliers finance inventories through accounts payable. * Permanent Working Capital: It refers to a certain minimum level of current
assets which is essential for the firm to carry on its business irrespective of the level of operations. This is the irreducible minimum amount necessary

The Basel IIi Regulatory Framework And Its Implication For...
Critically Analyze the Basel III Regulatory Framework and its implication for financial Institutions. Introduction Basel III is a far–reaching set of
reform measures developed by Basel committee on banking administration and risk management of banking industry. The third segment was developed
in response to the deficiencies in financial regulation which were highlighted in 2007 –08 financial crisis. The outcome of the 2008 Financial Crisis
(which begun in 2007), has witnessed numerous changes one of the changes was the need for an enhanced Basel ll framework which had failed
miserably during the 2007– 2008 financial crunch. After the global financial crisis, the G20 and the Basel Committee on Banking Supervision
planned a series of new bank capital and liquidity guidelines called Basel lll. The first version of Basel lll was drafted and published in late 2009.
Later on 12th September 2010 the Basel committee announced the new capital and liquidity ratios and the timeline by which banks need to fulfill the
requirements. Once implemented new changes will have a drastic impact on the banking sector. It will mark an end to asset driven liability
management which will force the banks to adapt the characterized banking or we can say the size of banks balance sheet will be dependent on their
ability attract funds rather than their capacity to secure assets. A cautious study of 2009 accord shows minimal capital requirements, administration
practices and revelations to the

Disadvantages Of Dragon Slayer Bank
3)
As the very definition of demand deposits are customer accounts held by banks for security purposes, earning minute interest levels, a decrease in
demand deposits can become quite troublesome (Investopedia, 2017). With $300m in demand deposits representing 12.07% of Total Liability &
Equity, should this level decrease by any such margin, total assets of equal margin, by definition must be reduced, to satisfy A = E + L.
Resulting from a decrease in demand deposits could force Dragon Slayer Bank to sell off loans at a discount to hold a buffer on the desired level of
capital.
Should Dragon Slayer bank decide against selling loans at a discount, the bank may have to settle with lesser levels of Assets, Liabilities and Equity.
This may expose them to lower share pricing on the stock market, which in turn would lessen dividends (assuming listed on the ASX and pays
dividends to shareholders), less–lucrative contracts could present themselves as the bank could be seen as inadequate or unworthy.
Furthermore, this could present trouble in regards to appropriate cushioning for holding sufficient levels of capital. Under extreme circumstances,
should the bank not be able to hold sufficient capital levels (i.e. 8% up to 2015, and 10.5% from 2016 onwards) necessitated by APRA, a bailout may
perhaps be necessary or even the windup of the company, forced into liquidation.
Moving to a customer point–of–view in regards to decreases in demand deposits. With surges in withdrawals, such as IndyMac Bank in 2008 (Lange,
et. al, 2016, pp 129–130), a weakening capital position could indicate to investors and depositors that their value held with the bank could possibly
decrease. This could result in high levels of customers withdrawing their funds could putting immense pressure on the bank and its monetary levels to
stay profitable.
4)
By looking merely at the Balance Sheet, Dragon Slayer Bank appears to have sufficient assets to cover any unexpected losses that may arise due to
market turns. However, upon APRA's minimum capital requirements, stemming from Basel III, set proportionally for every Financial Institution, it
becomes a lot clearer to identify if the bank would be able to survive unexpected changes.
Below is

Julian Eastheimer Essay

Recommended

Recommended

More Related Content

More from Katie Ellis

More from Katie Ellis (20)

Recently uploaded

Recently uploaded (20)

Julian Eastheimer Essay