Bank Analysis School - September 2023

Internal Use Only

How much Support is Provided by Current Levels of Earnings and Capital (12/31/2018)?

Earnings:

• Return on Average Assets is 0.04% • Net Interest Margin is 3.63%

Capital:

• Tier 1 Leverage Ratio is 8.16%

Internal Use Only

Is Oversight of Interest Rate Risk Adequate for the Size and Risk Profile of the Bank?  Policy and risk limits  Earnings forecasted over at least a two-year period  Static earnings simulation  Economic value of equity modeled  Range of severe scenarios (e.g., 400 basis points, non-parallel)  Stress testing of critical assumptions  Document key assumptions  Independent review  Back-testing