Sigma Bank Has the Following Balance Sheet in Millions of Dollars.Unless

question 39

Multiple Choice

Sigma Bank has the following balance sheet in millions of dollars.Unless mentioned otherwise, all assets are associated with corporate customers (not governments or sovereigns) .Values are in millions of dollars.Refer to table 20-8 for appropriate risk weights. $$\begin{array} { | l | r | l | r | } \hline \text { Cash } & \$ 40 & \text { Deposits } & \$ 370 \\\hline \begin{array} { l } \text { Municipal General } \\\text { Obligation Bonds }\end{array} & \$ 60 & & \\\hline \begin{array} { l } \text { Residential Mortgages } \\\text { 1-4 family } \\\left( 80 \% { - 90\% } \text { LTV } \right) \end{array} & \$ 100 & \begin{array} { l } \text { Perpetual Preferred } \\\text { Stock }\end{array} & \$ 20 \\\hline \begin{array} { l } \text { Commercial loans } \\\text { BB + rated }\end{array} & \$ 200 & \text { Equity } & \$10\\\hline \text { Total Assets } & \$ 400 & & \$ 400 \\\hline\end{array}$$ Off balance sheet contingent liabilities (Refer to Table 20-10) $40 million direct-credit substitute standby letters of credit issued to a U.S.corporation.
$40 million commercial letters of credit issued to a corporation
Off-balance sheet derivatives (Refer to Table 20-11)
$200 million 10-year interest rate swaps
$100 million 2-year forward DM contracts
What is the minimum required Tier I and Total risk-based capital for the on-balance-sheet assets in order for the DI to be adequately capitalized?

• A)$8 million; $8 million.
• B)$16.87 million; $16.87 million.
• C)$17.22 million; $22.96 million.
• D)$22.96 million; $28.70 million.
• E)$10.8 million; $8 million.

Recognize the implications of silence as a means of acceptance in forming a contract.

Analyze how cultural differences influence the interpretation and enforcement of contracts.

Identify the conditions under which a contract can be considered binding, including the role of acceptance.

Understand the legal consequences of the death of an offeror or the illegality of the subject matter of an offer on the offer itself.

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Definitions:

Dendrites

The branched projections of a neuron that receive electrochemical stimulation from other neural cells.

Axon

A thin, extended part of a neuron, also known as a nerve cell, that often transmits electrical impulses away from the cell's central body.

Glia Cells

Non-neuronal cells in the central nervous system that support, protect, and nourish neurons, playing a crucial role in maintaining homeostasis and forming myelin.

Insulating

The act of preventing the transfer of heat, electricity, or sound from one material to another.