Briefly speculate on how the FDIC has contributed to moral hazard.Briefly speculate on whether the Financial Services Modernization Act reduced or increased risk in the banking sector since its passage.What is the objective of CAMELS ratings? Select one of the components and briefly indicate how it supports the objective.Briefly describe an argument you favor for or against a government rescue of failing banks.Briefly describe two provisions of the Financial Reform Act of 2010. How do they support the objective of this act?Briefly speculate on why the Federal Reserve would prefer banks hold more Treasury bills as part of a liquidity strategy. Why would banks tend to not favor holding too much of these?Briefly describe two methods banks use to reduce interest rate risk.Suppose a bank earns $325 million in interest revenue but pays $279 million in interest expense. It also has $624 million in earning assets. What is its net interest margin?If a bank earns $43 million net profit after tax and has $3 billion invested in assets, what is its return on assets?If a bank earns $75 million net profits after tax and has $7.5 billion invested in assets and $600 million equity investment, what is its return on equity?
