1. Why is it important for all of us students of finance to have a clear understanding of what the FED does?

2. The table below shows the balance sheet of all commercial banks based on aggregate data found in the Federal Reserve Bulletin. Compare the data in the table to the balance sheet of Bank of America (

BOA

) which can be found at 

https://www.marketwatch.com/investing/stock/bac/financials/balance-sheet

.  Specifically, add two columns to the table to present BOA percentages (

10

points).

All banks

BOA

As far as BOA is concerned, use 2019 data.   Use your table to compare the percentages of loans and securities in the balance sheet of BOA (2019) with the percentages of loans and securities presented in the balance sheet of all commercial banks (2016).  Limit your comparison to 200 words per category compared (loans (5 points) and securities (5 points)).   Remember to add the number of words and references.

The balance sheet of all commercial banks in 2016 in the table below (items as a percentage of total)

State and local government and other securities

10

8

Total

100

***** Source: http://www.federalreserve.gov/releases/h8/ and http://www.federalreserve.gov/releases/h6/.

3. Bank of America Balance sheet also show: (5 points)

Customer liability on acceptances

Capitalized lease obligations

ESOP Debt guarantee

Other appropriate reserves

Accumulated minority interests

Briefly define each term do not exceed 100 words per term defined) (1 point per term defined total 5 points).  Remember to add the number of words and the references.

4. Find a recent event/article/commentary published in the popular press about:

     Securities Brokers and/or Dealers and/or Investment Banks

     How financial institutions manage credit risk?

     How financial institutions manage interest rate risk? 

The event/article/commentary must be recent (must have occurred after December 2019).   Summarize the event/article/commentary and explain why you have selected that event/article/commentary (maximum 200 words).  Email the link for the event/article/commentary.   Add the number of words and the references. (5 points per article, 15 points total)