Change in value unrealized gains or losses ARE reflected on the Balance Sheet

Change in value (unrealized gains or losses) ARE reflected on the Balance Sheet (Change to Shareholder’s Equity)§May be a current or long-term asset, depending on maturity14

Commercial Bank Financial StatementsnBank AssetsnNon-Interest Cash and Due From BanksnVault CashnDeposits held at the Federal ReservenCash Items in Process of Collection (CIPC)§Largest component of this category15

Commercial Bank Financial StatementsnBank AssetsnOther AssetsnBank PremisesnOREO§Often foreclosed propertynBanker’s Acceptances16

Commercial Bank Financial StatementsnBank Liabilities and Stockholder’s EquitynTransaction AccountsnDemand Deposits§Pays no interest§Available to all customersnNOW Accounts§Pays “market” interest rate§Not available to for-profit corporationsnATS Accounts§Pays “market” interest rate§Not available to for-profit corporations19

Commercial Bank Financial StatementsnBank Liabilities and Stockholder’s EquitynTransaction AccountsnMMDAs§Pays market interest rate§Limited to six checks per month§Available to all customers20

Commercial Bank Financial StatementsnBank Liabilities and Stockholder’s EquitynSavings and Time DepositsnSavings Deposits§No MaturitynTime Deposits (CDs)§“Large” or Jumbo CDs§Negotiable§“Small” CDs21

Commercial Bank Financial StatementsnBank Liabilities and Stockholder’s EquitynOther BorrowingsnFed Funds Purchased Repurchase AgreementsnBrokered DepositsnDeposits Held in Foreign Offices§Issued by a bank subsidiary outside the U.S.nFederal Home Loan Bank BorrowingsnSubordinated Notes and Debentures22

Commercial Bank Financial StatementsnBank Liabilities and Stockholder’s EquitynCore DepositsnDeposits that are NOT very interest rate sensitivenRepresent permanent funding basenMade up of:§Demand Deposits§NOW and ATS accounts§MMDAs§Savings Accounts§“Small” Time Deposits23

Commercial Bank Financial StatementsnBank Liabilities and Stockholder’s EquitynNon-Core DepositsnDeposits that are very interest rate sensitivenAKA§Volatile Liabilities§Hot Money§Purchased Liabilities§Short-Term Non-Core Funding24

Commercial Bank Financial StatementsnBank Liabilities and Stockholder’s EquitynNon-Core DepositsnConsist of:§Federal Funds Purchased§Repos§“Large” Time Deposits§Brokered Time Deposits25

Commercial Bank Financial StatementsnBank Liabilities and Stockholder’s EquitynAll Common and Preferred EquitynPreferred StocknCommon Stock26

Commercial Bank Financial StatementsnIncome StatementnInterest Income (II)nIncludes interest and fees from:§Loans§Deposits at other institutions§Trading Account Securities§Municipal Securities§Estimated Tax Benefit = §Municipal Interest Rate/(1 – Marginal Tax Rate) = Tax-Equivalent Municipal Interest Income30

Commercial Bank Financial StatementsnIncome Statementn