Harrison Bank has the following financial information: $\begin{array}{lr} \text { ROE } & 16 \% \\ \text { Net Income } & \$ 1000 \\ \text { Total Assets } & \$ 62,500 \\ \text { Total Equity } & \$ 6250 \end{array}$ What is the bank's asset utilization ratio?

A) 1.6% B) 10% C) 12.8% D) 16% E) None of the options is correct A) 1.6% B) 10% C) 12.8% D) 16% E) None of the options is correct

Exam 6: Measuring and Evaluating the Performance of Banks and Their Principal Competitors

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The ratio of nonperforming assets to total loans and leases is considered to be a measure of a bank's market risk.

(True/False)

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Question 61

The ratio that equals total interest income divided by total earning assets less total interest expense divided by total interest-bearing liabilities is known as the:

(Multiple Choice)

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(36)

Question 62

Which of the following would be the best example of a ratio used to examine a bank's interest rate risk?

(Multiple Choice)

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Question 63

The difference between such sources of bank income as service charges on deposits and trust-service fees,and such sources of bank expenses as salaries and wages and overhead expenses divided by total assets or total earning assets is called the:

(Multiple Choice)

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(46)

Question 64

Following data pertains to Castle State Bank. -What is the bank's asset utilization ratio?

(Multiple Choice)

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Question 65

Forrest Fennell is planning to invest in Capital City Bank.He is examining the ratios of nonperforming loans to total loans and leases and the provision for loan losses to total loans and leases.What type of risk is Forrest attempting to measure with these ratios?

(Multiple Choice)

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Question 66

Which of the following types of banks tend to enjoy the highest net-interest margins in the industry?

(Multiple Choice)

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Question 67

In recent years,banks have been __________ profitable than (as)S&Ls and Savings Banks.

(Multiple Choice)

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(32)

Question 68

ROA measures how capably the management of a financial institution has been converting the institution's assets into net earnings.

(True/False)

4.9/5

(28)

Question 69

A bank's ROE equals its ROA times its:

(Multiple Choice)

4.8/5

(39)

Question 70

Harrison Bank has the following financial information: ROE 16\% Net Income \ 1000 Total Assets \ 62,500 Total Equity \ 6250 What is the bank's asset utilization ratio?

(Multiple Choice)

4.7/5

(45)

Question 71

________________________ is one of the most widely respected private institutions that rates the credit quality of financial institutions.

(Short Answer)

4.9/5

(37)

Question 72

__________________________ is the risk that the value of the financial institution's asset portfolio will decline due to falling market prices.

(Short Answer)

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Question 73

The ratio of a bank's net operating income to the number of a bank's full-time-equivalent employees is called the employee productivity ratio.

(True/False)

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(35)

Question 74

__________________________ measures the return to stockholders on their investment in a bank.It is the product of net profit margin,asset utilization,and the equity multiplier.

(Short Answer)

4.8/5

(32)

Question 75

Following data pertains to Castle State Bank. -What is Castle State Bank's ROE?

(Multiple Choice)

4.7/5

(45)

Question 76

A phenomenon wherein interest rates and security prices in the financial marketplace move against a troubled firm,forcing it to make crucial adjustments in policies and performance in order to calm investors' worst fears is often referred to as __________________ by economists.

(Short Answer)

4.9/5

(31)

Question 77

Chaos State Bank has an old computer system which can go down for weeks at a time,leaving customers unable to access their accounts online.Many customers have left the bank for banks with more reliable computer systems.Which type of risk would this be an example of?

(Multiple Choice)

4.9/5

(34)

Question 78

According to the text,the ratio of a bank's net after-tax income to pre-tax net operating income is a measure of tax management efficiency.

(True/False)

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(23)

Question 79

A bank's stock price will tend to rise if the:

(Multiple Choice)

4.9/5

(38)

Question 80

Showing 61 - 80 of 118

The ratio of nonperforming assets to total loans and leases is considered to be a measure of a bank's market risk.

The ratio that equals total interest income divided by total earning assets less total interest expense divided by total interest-bearing liabilities is known as the:

Which of the following would be the best example of a ratio used to examine a bank's interest rate risk?

The difference between such sources of bank income as service charges on deposits and trust-service fees,and such sources of bank expenses as salaries and wages and overhead expenses divided by total assets or total earning assets is called the:

Following data pertains to Castle State Bank. -What is the bank's asset utilization ratio?

Forrest Fennell is planning to invest in Capital City Bank.He is examining the ratios of nonperforming loans to total loans and leases and the provision for loan losses to total loans and leases.What type of risk is Forrest attempting to measure with these ratios?

Which of the following types of banks tend to enjoy the highest net-interest margins in the industry?

In recent years,banks have been __________ profitable than (as)S&Ls and Savings Banks.

ROA measures how capably the management of a financial institution has been converting the institution's assets into net earnings.

A bank's ROE equals its ROA times its:

Harrison Bank has the following financial information: ROE 16\% Net Income \ 1000 Total Assets \ 62,500 Total Equity \ 6250 What is the bank's asset utilization ratio?

________________________ is one of the most widely respected private institutions that rates the credit quality of financial institutions.

__________________________ is the risk that the value of the financial institution's asset portfolio will decline due to falling market prices.

The ratio of a bank's net operating income to the number of a bank's full-time-equivalent employees is called the employee productivity ratio.

__________________________ measures the return to stockholders on their investment in a bank.It is the product of net profit margin,asset utilization,and the equity multiplier.

Following data pertains to Castle State Bank. -What is Castle State Bank's ROE?

A phenomenon wherein interest rates and security prices in the financial marketplace move against a troubled firm,forcing it to make crucial adjustments in policies and performance in order to calm investors' worst fears is often referred to as __________________ by economists.

Chaos State Bank has an old computer system which can go down for weeks at a time,leaving customers unable to access their accounts online.Many customers have left the bank for banks with more reliable computer systems.Which type of risk would this be an example of?

According to the text,the ratio of a bank's net after-tax income to pre-tax net operating income is a measure of tax management efficiency.

A bank's stock price will tend to rise if the:

An Overview of the Changing Financial-Services Sector

The Impact of Government Policy and Regulation on the Financial-Services Industry

The Organization and Structure of Banking and the Financial-Services Industry

Establishing New Banks, Branches, ATMs, Telephone Services, and Websites

The Financial Statements of Banks and Their Principal Competitors

Risk Management for Changing Interest Rates: Asset-Liability Management and Duration Techniques

Investment Banking,Insurance,and Other Sources of Fee Income

Risk Management: Asset-Backed Securities, Loan Sales, Credit Standbys, and Credit Derivatives

The Investment Function in Financial-Services Management

Liquidity and Reserves Management: Strategies and Policies

Managing and Pricing Deposit Services

Managing Nondeposit Liabilities

Investment Banking, insurance, and Other Sources of Fee Income

The Management of Capital

Lending Policies and Procedures: Managing Credit Risk

Lending to Business Firms and Pricing Business Loans

Consumer Loans, Credit Cards, and Real Estate Lending

Acquisitions and Mergers in Financial-Services Management

International Banking and the Future of Banking and Financial Services

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