Bank Analysis School Case Study eBook

Capital Analysis – Sunny State Bank

Objective : Analyze the capital adequacy of Sunny State Bank to determine the component rating and answer the questions below.

Materials Needed: Description

Location

Sunny State Bank UBPR and Depository Deep Dive

Case Study E-Binder (Resource Materials)

Sunny State Bank Capital Plan

Case Study E-Binder (Capital)

Examiner Memo of Capital at Sunny State Bank

Emailed

Capital Basics Job Aid

E-Binder (Capital)

UFIRS Capital Rating Definitions

E-Binder (Resource Material)

Discussion Questions:  What happened to Total Bank Equity Capital from 12/31/20X4 to 12/31/20X5? What were the largest drivers of change (what happened during the year)?

 What about Average Assets and Tier 1 Capital?

 What about Risk Weighted Assets and Total Assets for Leverage Ratio?

 What are the bank’s four capital ratios? How do they compare to the prior year? What would you say looks like the reason the ratios changed (i.e. break down the numerator and denominator)?

 What is the capital designation of this bank?

 Based on this, what do you think of the Capital Plan? What are some options the bank has if they wanted to raise additional capital?

 How would you rate Capital at Sunny State Bank, and why?

 What other component areas that you see at this bank could impact how you rate Capital?