medium · Corporate Credit Analysis
A bank analyst is evaluating the CET1 ratio for Heritage Bancorp. Heritage has Total Assets of $100B, of which $20B are cash (0% risk weight), $50B are mortgages (50% risk weight), and $30B are corporate loans (100% risk weight).
If Heritage has $5B in Common Equity Tier 1 capital, what is its CET1 ratio?
- 10.00%
- 7.14%
- 5.00%
- 9.09%
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