Question

The financial statements for MHM Bank (MHM) are shown below:

Balance Sheet MHM Bank
Assets				Liabilities and Equity
Cash and due from banks	$	1,960		Demand deposits	$	10,660
Demand deposits at other FIs		1,500		Small time deposits		10,390
Investments		6,150		Jumbo CDs		7,710
Federal funds sold		3,030		Federal funds purchased		510
Loans (less reserve for loan losses of 2,800)		20,130		Other liabilities		2,480
Premises		2,310		Equity		3,330
Total assets	$	35,080		Total liabilities/equity	$	35,080

Income Statement MHM Bank
Interest income	$	4,128
Interest expense		2,104
Provision for loan losses		500
Noninterest income		740
Noninterest expense		1,015
Taxes		275

a. Calculate the dollar value of MHM’s earning assets.
b. Calculate the dollar value of MHM’s interest-bearing liabilities.
c. Calculate MHM’s spread. (Do not round intermediate calculations. Round your answer to 3 decimal places. (e.g., 32.161))
d. Calculate MHM’s interest expense ratio. (Round your answer to 3 decimal places. (e.g., 32.161))
  

Answer 1