I’m studying and need help with a Management question to help me learn.1. Use the balance sheet for San
Diego Bank in Exhibit A and the industry norms in
Exhibit B to answer the following questions.
a. Estimate the gap and the gap ratio and determine
how San Diego Bank would be affected by an increase
in interest rates over time. b. Assess San Diego’s credit risk. Does it appear high or
low relative to the industry? Would San Diego Bank perform better or worse than other banks during a recession? c. For any type of bank risk that appears to be higher
than the industry, explain how the balance sheet could
be restructured to reduce the risk.2. Select a bank whose
income statement data are available. Using recent
income statement information about the commercial
bank, assess its performance. How does the performance of this bank compare to the performance of
other banks? Compared with the other banks assessed
in this chapter, is its return on equity higher or lower?
What is the main reason why its ROE is different from
the norm? (Is it due to its interest expenses? Its noninterest income?)
Requirements: Enough