Obtain financial statements of two banks (many are online).
Calculate the following...

Question

Obtain financial statements of two banks (many are online). 
Calculate the following ratios:

Borrowed funds to total assets Core deposits to total assets Loans to deposits Commitments to lend to total assets 
Using these ratios compare the two banks' liquidity positions. 
Which is more likely to need to rely on borrowed funds? In which bank would you 
rather be a depositor? In which bank would you rather be a shareholder? Write a 
comparative analysis.
Present your work as a 1-page report in a Word document formatted 
in APA style make sure you site your sources.

David · Accepted Answer

For the present case study we have chosen Bank of America and Deutsche Bank as the 
subject matter of study. Analysis of the various ratios gives the following insights about both the 
banks: 
Solvency analysis 
Borrowed funds to total asset ratio for both the banks is very high this shows that banks 
has borrowed huge funds for their operations, such high level of debt in the capital structure is 
not good for the financial health of the company.  
An organization should always maintain a balance between the debt and equity, best way 
to assess whether a company is carrying more debt or not is to analyze its financial ratios. 
Financial ratios will help to analyze whether a company is overburdened by the debt or not.  
Solvency ratios are helpful in analyzing the long term solvency position of the company 
such as borrowed funds to total assets, debt equity ratio etc.

Obtain financial statements of two banks (many are online). Calculate the following ratios: Borrowed funds to total assets Core deposits to total assets Loans to deposits Commitments to lend to total...

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