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Question
Timothy Gartner, an employee in the Bank of Trust and Faith, has requested for a loan of $200,000 to buy a private cruise. The bank has an unimpaired capital and surplus of $38 million and $75 million in total time and savings deposits. Average revenue for the bank in the last three years is $18.5 million and a net interest income of $5.2 million. What is the maximum amount of loan the bank can grant to Timothy?
A. $950,000
B. $200,000
C. $25,000
D. $100,000
E. The bank cannot make loans to its own employees
Answer
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