question archive Bank of America faces the following inflows and outflows during the coming month: 1
Bank of America faces the following inflows and outflows during the coming month: 1
Subject:FinancePrice:3.86 Bought15
Bank of America faces the following inflows and outflows during the coming month: 1. deposit withdrawals of $33 million 2. Customer loan repayments of $2016 million 3. sales of assets $36 million 4. operating expenses of $51 million 5. new loan request accepted of $588 million 6. deposits of $1340 million 7. borrowings from the money market of $43 million 8. nondeposit service fees of $54 million 9. borrowings to be repaid of $46 million 10. divided payment of $280 million 11. extraordinary income of $100. What is Bank of America's projected net liquidity position for the coming month? Using the information given below calculate the ROA for each of the banks. Amounts in thousand's Bank ROE Total Equity Total Asset 1. Barclays bank 4.31% 90.899 443.291 2. Midland bank 10.67% 41.585 381.505 3. National bank 22.79% 51.799 386.696 4. J.P Morgan 7.45% 1.123.318 8.441.249 5. Qatar bank 16.05% 214.197 2.300.388 1. discuss the difference between bank goals and bank objectives in the planning process. What is the ultimate objective of bank? 2.explain the meaning of standard & poors AAA and AA credit ratings. 3. explain the difference between a line of credit and a revolving loan. 4. why is government interested in supporting bank liquidity in the face of financial panic? Should very large banks be prevented from failing by the government? 5. how does the deposit compositions of small and large banks differ?
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Step1
Bank Net Liquidity= Inflows ( Deposits +Bond issue +income + loan re Payment ) only short term - Outflows ( Withdrawls + Bonds Re pay + Expences ) Short term out flows
Step 2
| Bank of America faces the following inflows and outflows | ||
| Millions | Reason of Expanation | |
| Infows | $ | |
| Customer Loan Re payments | 0 | Long term Bank receiving from Customers |
| Sale of Assets | 0 | Long term Assets sale from bank |
| Deposits | 1340 | Receiving from Customer |
| Borrowing from Money Maraket | 43 | Loan Received from money market |
| Non Deposit Service fee collected | 54 | fee received from customers |
| Divedend Payment | 280 | outflow from bank |
| Extraordianry Income | 100 | inflow |
| Total of Infows (A) | 1817 | |
| Outflows | ||
| Deposits Withdrawl | 33 | Customers withdrawal |
| Operation Expences | 51 | outflow |
| New Loans Requested Accepted | 0 | outflow Long term treated |
| Borrowing To Repaid | 46 | outflow |
| Total of Outflow ( B ) | 130 | |
| Net out Flow Liquidity | 1687 |
if we considers All Inflows and out flowa Net liqidity is as follows
| Bank of America faces the following inflows and outflows | ||
| Millions | Reason of Expanation | |
| Infows | $ | |
| Customer Loan Re payments | 2016 | Bank receiving from Customers |
| Sale of Assets | 36 | Assets sale from bank |
| Deposits | 1340 | Receiving from Customer |
| Borrowing from Money Maraket | 43 | Loan Received from money market |
| Non Deposit Service fee collected | 54 | fee received from customers |
| Divedend Payment | 280 | outflow from bank |
| Extraordianry Income | 100 | inflow |
| Total of Infows (A) | 3869 | |
| Outflows | ||
| Deposits Withdrawl | 33 | Customers withdrawal |
| Operation Expences | 51 | outflow |
| New Loans Requested Accepted | 588 | outflow |
| Borrowing To Repaid | 46 | outflow |
| Total of Outflow ( B ) | 718 | |
| Net out Flow Liquidity | 3151 |
| ROA Formula / Return on Assets Calculation. Return on Assets (ROA) is a type of return on investment (ROI) It is most commonly measured as net income divided by the original capital cost of the investment. The higher the ratio, the greater the benefit earned. |
| ROA = Net Income / Average Assets | |||||
| ROE = Net Income / Equity shares | |||||
| Net Income = | ROE * Equity | ||||
| Net Income = | ROE | Equity | Assets | ROA = Net income / Assets | |
| Barclays banks | 391.77469 | 4.31 | 90.899 | 443.291 | 0.88 |
| Midland bank | 443.71195 | 10.67 | 41.585 | 381.505 | 1.16 |
| National Bank | 1180.49921 | 22.79 | 51.799 | 386.696 | 3.05 |
| J p Morgan | 8368.7191 | 7.45 | 1123.318 | 8441.249 | 0.99 |
| Qutar Bank | 3437.86185 | 16.05 | 214.197 | 2300.388 | 1.49 |
Nation Banks high Perfor ROE and ROA
The main difference between objectives and goals is that objectives are precise actions or measurable steps individuals and groups take to move closer to the goal. They are specific targets that typically have a time-bound schedule or timeline for completion.
Bond interest rates in the market, usually referred to as yields, vary based on many factors. Typically, shorter-term bonds carry lower interest rates than longer-term ones. Credit risk also factors into the equation. Although both AA- and AAA-rated bonds qualify as "investment-grade" and are relatively safe, the AAA bond, which holds the highest possible rating, will typically carry the lower rate of interest.
