Gavin
| | | Group Members:Yimeng (Emon) CHEN-A1169382Wenjing (Nancy) LAI – A1169890Yeqing LIN (Lyn) – A1169406Xutianli LIU(Cherry) – A1169401Xinxin NI (Cecilia) – A1169836 | | | May 2009 | |
Financial Institutions Management II Group Assignment
Project I: Performance Analysis Project II: Risk Analysis
The year 2008 has seen extraordinary influences on the financial institutions. The original melt-down in the sub-prime market affect the credit market globally and severely, which, finally, led to the financial crisis. Existing weakness in financial industry regulation have triggered the global financial system collapse. Compared with commercial banks, the financial crisis is a heavier blow on investment banks since the collapse and bailout of major investment banks around the world, meanwhile, no commercial banks have collapsed thus far.
In project one, we concentrate on the performance of each bank and how they reacted with financial crisis. In project two, interest rate risk and off-balance-sheet risk exposures will be examined using different models
PROJECT 1: PERFORMANCE ANALYSIS
CAPITAL RAISING ACTIVITIES
Bank of America
As a commercial bank, Bank of America raises capital mainly by collecting deposits from businesses and consumers via checkable deposits, savings deposits, and time (or term) deposits. It makes loans to businesses and consumers. It also buys corporate bonds and government bonds. Its primary liabilities are deposits and primary assets are loans and bonds. The commercial bank generates a profit by paying depositors a lower interest rate than the bank charges on loans.
Deposits are the mainly source of capital for a commercial bank.Referring to the 2008 Annual Report of Bank of America, which reveals that the total deposits for the year is $882,997 million, occupies almost 53.8% of the total liabilities, ranking as the largest amount of liabilities of a commercial bank.
Deposits are relatively stable and low cost of
Financial Institutions Management II Group Assignment
Project I: Performance Analysis Project II: Risk Analysis
The year 2008 has seen extraordinary influences on the financial institutions. The original melt-down in the sub-prime market affect the credit market globally and severely, which, finally, led to the financial crisis. Existing weakness in financial industry regulation have triggered the global financial system collapse. Compared with commercial banks, the financial crisis is a heavier blow on investment banks since the collapse and bailout of major investment banks around the world, meanwhile, no commercial banks have collapsed thus far.
In project one, we concentrate on the performance of each bank and how they reacted with financial crisis. In project two, interest rate risk and off-balance-sheet risk exposures will be examined using different models
PROJECT 1: PERFORMANCE ANALYSIS
CAPITAL RAISING ACTIVITIES
Bank of America
As a commercial bank, Bank of America raises capital mainly by collecting deposits from businesses and consumers via checkable deposits, savings deposits, and time (or term) deposits. It makes loans to businesses and consumers. It also buys corporate bonds and government bonds. Its primary liabilities are deposits and primary assets are loans and bonds. The commercial bank generates a profit by paying depositors a lower interest rate than the bank charges on loans.
Deposits are the mainly source of capital for a commercial bank.Referring to the 2008 Annual Report of Bank of America, which reveals that the total deposits for the year is $882,997 million, occupies almost 53.8% of the total liabilities, ranking as the largest amount of liabilities of a commercial bank.
Deposits are relatively stable and low cost of