What is the financing requirement

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Reference no: EM132557102

Awoody depository institution (DI) has the following balance sheet (USD millions):

Assets

Liabilities & Equity

Cash                      9

Equity                     5

Loans                      90

Deposits                     75

Securities                      26

Purchased funds             50

Other assets                       10

Other liabilities                       5

Total                              135

The securities portfolio includes $16 million in Treasury-bills (T-bills) and $10 million in Government Bonds. The DI expects a net deposit drain of $20 million.

Question (i) Calculate the financing gap

Question (ii) What is the financing requirement?

Reference no: EM132557102

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