Finance
Instructions
It is relatively easy to find up-to-date information on banks because of their extensive reporting requirements. Go to: https://www.fdic.gov/bank/analytical/qbp/This site is sponsored by the Federal Deposit Insurance Corporation (FDIC). You will find summary data on financial institutions. Go to the most recent Quarterly Banking Profile. Click on All FDIC- Insured Institutions Section. Scroll to the bottom and open Table 1-A. a. Have banks' return on assets been increasing or decreasing over the last 3 years? b. Has the core capital been increasing? Why do you think? c. How many institutions are currently reporting to the FDIC?
Answer
a. Have banks' return on assets been increasing or decreasing over the last 3 years?For the past three years, banks have had an increase and decrease in their return on asset (ROA). For instance, in 2013, ROA was at 1.07, while in 2014 it decreased to 1.01 then increased to 1.05. Based on this trend, it can generally be concluded that the banks ROA has decreased. b. Has the core capital been increasing? Why do you think?For the past three years, the core capital has increased from 9.4 to 9.61 from 2013 to 2015, respectively. This increasing trend can be attributed to the fear of large loan defaults, and banks want to safeguard themselves. The increase can also be as a result of lack of depositors due to low interest rates. c. How many institutions are currently reporting to the FDIC?The to...
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