Multiple Choice
A bank has issued $5,000,000 in long term debt and since that time interest rates have risen so that it will only cost the bank $3,000,000 to buy the long term debt back.The bank decides to issue $3,000,000 in new stock and use the proceeds to retire the long term debt.What way of meeting their capital needs is the bank taking?
A) Issuing common stock
B) Issuing preferred stock
C) Issuing subordinated notes and debentures
D) Selling assets and leasing facilities
E) Swapping stock for debt instruments
Correct Answer:
Verified
Correct Answer:
Verified
Q108: A bank has a net profit margin
Q109: The Basel Agreement on new capital standards,as
Q110: Which of the following assets fit(s)into the
Q111: Under the FDIC Improvement Act of 1991,a
Q112: What type of preferred stock has appeared
Q114: Supplemental capital such as the allowance for
Q115: In the field of banking,capital refers principally
Q116: _ is a hybrid form of debt
Q117: Second National Bank is forecasting a return
Q118: A bank has $200 million in assets