Most diversified portfolio

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Consider the following loan categories:

Loan Type

Singapore Banks Total ($b)

Bank A ($b)

Bank B ($b)

Bank C ($b)

Bank D ($b) *

Real Estate

4,800

21

40

10

 

Commercial

10,200

171

48

12

 

Industrial

3,200

42

40

10

 

Consumer

2,800

18

64

8

 

Travel and Hospitality

14,000

20

60

45

 

Other

15,000

48

40

10

 

  1. Bank D is only investing in short-term government securities.

Which bank has the most diversified portfolio? Show all calculations. [Hint: Use the formula presented in the course.]

b)Explain why the approach that you employed in Question 7a has benefits and limitations. Ensure that the benefits and limitations are justified and clearly explained. What impact would COVID -19 have on your answer.

Reference no: EM133111172

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