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Question
A bank currently just meets its total capital requirements of 8%. The bank currently has a dividend payout ratio of 35%. Assets are expected to grow at 5%.If the bank expects its ROA to be .45% and the bank does not wish to change its dividend payout ratio from 35%, how much new equity capital (as a percent of total assets) must the bank issue to support the growth in assets?
a. 0.001075%
b. 0.01075%
c. 0.1075%
d. 1.075%
e. 10.75%
Answer
This answer is hidden. It contains 104 characters.
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