Commercial Banks: From the Balance Sheet to the Income Statement and Cash Flow Statement

($ in Millions)

Assumptions:
Taxes, Regulatory Capital, and Operating Assumptions:
Tax Rate: 25.0%
Minimum Common Equity Tier 1 Ratio: 7.0%
Minimum Tier 1 Capital Ratio: 8.5%
Minimum Total Capital Ratio: 10.5%
Minimum Tier 1 Leverage Ratio: 4.0%

% of Allowance for Loan Losses in Tier 2 Capital: 50.0%

Loan Additions in Period Shown: $ 100.0

Commercial Bank - Balance Sheet:

Interest Interest Risk
ASSETS: Beginning: Ending: Rate: Income: Weight:
Cash: $ 100.0 $ 30.0 0.0% $ - 0.0%
Available for Sale Securities: 100.0 100.0 3.0% 3.0 100.0%
Other Securities: 200.0 200.0 2.5% 5.0 100.0%

Gross Loans: 1,000.0 1,100.0 10.0% 100.0 90.0%

Allowance for Loan Losses: (50.0) (55.0)
Net Loans: 950.0 1,045.0

Goodwill & Other Intangible Assets: 30.0 30.0 0.0% - 0.0%

Other Assets: 40.0 40.0 5.0% 2.0 100.0%

Total Assets: $ 1,420.0 $ 1,445.0 $ 110.0

Interest Interest
LIABILITIES & EQUITY: Beginning: Ending: Rate: Expense:
Liabilities:
Deposits: $ 1,000.0 $ 1,000.0 2.5% $ 25.0
Senior Debt: 100.0 100.0 4.0% 4.0
Subordinated Notes: 50.0 50.0 8.0% 4.0
Other Borrowings: 80.0 80.0 5.0% 4.0
Convertible Bonds: 20.0 20.0 0.0% -
Total Liabilities: 1,250.0 1,250.0

Equity:
Common Stockholders' Equity: 120.0 145.0
Preferred Stock: 50.0 50.0 10.0% 5.0
Total Equity: 170.0 195.0

Total Liabilities & Equity: $ 1,420.0 $ 1,445.0 $ 42.0

BALANCE CHECK: OK! OK!

REGULATORY CAPITAL:

Common Equity Tier 1 (CET 1): $ 90.0 $ 115.0

(+) Preferred Stock: 50.0 50.0
Tier 1 Capital: 140.0 165.0

Tier 2 Capital:
(+) Convertible Bonds: 20.0 20.0
(+) Subordinated Notes: 50.0 50.0
(+) Qualifying Allowance for LLs: 25.0 27.5
Total Tier 2 Capital: 95.0 97.5

Total Capital: $ 235.0 $ 262.5

Total Risk-Weighted Assets: 1,325.0 1,415.0

Total Tangible Assets: 1,390.0 1,415.0

Tangible Common Equity Ratio: 6.5% 8.1%

Common Equity Tier 1 Ratio: 6.8% 8.1%
Tier 1 Capital Ratio: 10.6% 11.7%
Total Capital Ratio: 17.7% 18.6%
Tier 1 Leverage Ratio: 10.1% 11.7%

Net Loans / Total Assets: 66.9% 72.3%

Deposits / Total Liabilities & Equity: 70.4% 69.2%
Net Loans / Deposits: 95.0% 104.5%
Cash Flow Statement

Commercial Bank - Income Statement: Loan Loss Reserve Calculations:

Annual Period: Annual Period:
(+) Interest Income: $ 110.0 Beginning Reserve Balance: $ 50.0
(-) Interest Expense: (37.0)
Net Interest Income: 73.0 Net Charge-Offs Calculation:
(-) Gross Charge-Offs: -
Net Fee & Commission Income: 12.0 (+) Recoveries: -
Net Charge-Offs: -
Provisions for Credit Losses: (5.0)
(+) Additions to Provisions: 5.0
Non-Interest Expenses: (40.0)
Ending Reserve Balance: $ 55.0
Pre-Tax Income: 40.0
(-) Income Taxes: (10.0) Key Operating Metrics and Ratios:
Net Income: 30.0
(-) Preferred Stock Dividend: (5.0) Net Charge-Off Ratio: 0.0%
Net Income to Common: $ 25.0 Net Charge-Offs / Reserves: 0.0%
Reserve Ratio: 5.0%
Commercial Bank - Cash Flow Statement:
Annual Period: Return on Common Equity: 18.9%
Cash Flow from Operations: Return on Tangible Common Equity: 24.4%
Net Income to Common: $ 25.0 Return on Assets: 2.1%
Provisions for Credit Losses: 5.0 Return on Tangible Assets: 2.1%
Changes in Operating Assets & Liabilities:
Additions to Gross Loans: (100.0) Net Interest Margin: 5.3%
Changes in Other Securities: - Average Interest Rate on IEA: 7.9%
Changes in Other Assets: - Average Interest on IBL: 3.0%
Changes in Deposits: - Spread: 4.9%
Total Cash Flow from Operations: (70.0)
Net Interest Income / Revenue: 85.9%
Cash Flow from Investing: Overhead Ratio: 47.1%
Sales / (Purchases) of AFS Securities: - Dividend Payout Ratio: 0.0%
(Purchases) of Intangible Assets: -
Total Cash Flow from Investing: -

Cash Flow from Financing:

Changes in Senior Debt: -
Changes in Subordinated Notes: -
Changes in Other Borrowings: -
Changes in Convertible Bonds: -
Preferred Issuances: -
Common Stock Issuances: -
Dividends to Common: -
Total Cash Flow from Financing: -
Net Change in Cash: $ (70.0)
Off-Balance Sheet Assets
Conversion
Balance: Factor:
Unused Commitments: $ 50.0 0.0%
< 1-Year Commitments 50.0 20.0%
> 1-Year Commitments 50.0 50.0%
Non-Sec. Guarantees: 50.0 100.0%
Total: $ 200.0
Silicon Valley Bank - Balance Sheet and Regulatory Capital:
($ in Millions)

Assumptions:
Regulatory Capital Minimums:
Minimum Common Equity Tier 1 Ratio: 7.0%
Minimum Tier 1 Capital Ratio: 8.5%
Minimum Total Capital Ratio: 10.5%
Minimum Tier 1 Leverage Ratio: 4.0%

Commercial Bank - Balance Sheet:

ASSETS: FY 21 FY 22
Cash: $ 14.6 $ 13.8
Available for Sale Securities: 27.2 26.1 <-- Recorded at fair market value, so there are no unrealized losses or gains.
Held to Maturity Securities: 98.2 91.3 <-- Massive unrealized losses here!
Other Securities: 2.5 2.7

Gross Loans: 66.3 74.3

Allowance for Loan Losses: (0.4) (0.6)
Net Loans: 65.9 73.6

Goodwill & Other Intangible Assets: 0.5 0.5

Other Assets: 2.4 3.8

Total Assets: $ 211.3 $ 211.8

LIABILITIES & EQUITY: FY 21 FY 22

Liabilities:
Deposits: $ 189.2 $ 173.1
Senior Debt: 2.6 18.9
Other Liabilities: 2.9 3.5
Total Liabilities: 194.7 195.5

Equity:
Common Stockholders' Equity: 12.6 12.4
Preferred Stock: 3.6 3.6
Noncontrolling Interests: 0.4 0.3
Total Equity: 16.6 16.3

Total Liabilities & Equity: $ 211.3 $ 211.8

BALANCE CHECK: OK! OK!

REGULATORY CAPITAL:

Common Stockholders' Equity: $ 12.6 $ 12.4

(-) Goodwill & Intangibles: (0.5) (0.5)
(+) Certain DTAs: - (0.1)
(+/-) Other Adjustments: 0.1 2.0
Common Equity Tier 1 (CET 1): 12.2 13.7
(+) Preferred Stock: 3.6 3.6
(+) Qualifying NCI: 0.4 0.3
(+/-) Other Adjustments: - (0.1)
Tier 1 Capital: 16.2 17.5

Total Risk-Weighted Assets: 100.8 113.6

Total Tangible Assets: 210.8 211.3
RWAs / Tangible Assets: 47.8% 53.8%

Tangible Common Equity Ratio: 5.7% 5.6%

Common Equity Tier 1 Ratio: 12.1% 12.1%
Tier 1 Capital Ratio: 16.1% 15.4%
Tier 1 Leverage Ratio: 7.7% 8.3%

Net Loans / Total Assets: 31.2% 34.8%

Deposits / Total Liabilities & Equity: 89.5% 81.7%
Net Loans / Deposits: 34.8% 42.5%
Credit Suisse - Balance Sheet and Regulatory Capital:
($ in Millions)

Assumptions:
Regulatory Capital Minimums:
Minimum Common Equity Tier 1 Ratio: 9.3%
Minimum Tier 1 Capital Ratio: 13.6%
Minimum Total Capital Ratio: 27.2%
Minimum Tier 1 Leverage Ratio: 4.8%

Commercial Bank - Balance Sheet:

ASSETS: FY 21 FY 22
Cash & Due from Banks: CHF 270.0 CHF 127.7
Available for Sale Securities: 111.1 65.5
Held to Maturity Securities: 1.0 1.7
Other Securities: 20.8 8.5

Gross Loans: 293.0 265.6

Allowance for Loan Losses: (1.3) (1.4)
Net Loans: 291.7 264.2

Goodwill & Other Intangible Assets: 3.2 3.4

Other Assets: 57.9 60.4

Total Assets: CHF 755.8 CHF 531.4

LIABILITIES & EQUITY: FY 21 FY 22

Liabilities:
Deposits: CHF 392.8 CHF 233.2
Debt & Borrowings: 186.3 169.6
Due to Banks & Central Bank Funds: 54.2 32.2
Other Liabilities: 78.3 51.0
Total Liabilities: 711.6 486.1

Equity:
Common Stockholders' Equity: 44.0 45.1
Preferred Stock: - -
Noncontrolling Interests: 0.3 0.2
Total Equity: 44.2 45.3

Total Liabilities & Equity: CHF 755.8 CHF 531.4

BALANCE CHECK: OK! OK!

REGULATORY CAPITAL:

Common Stockholders' Equity: CHF 44.0 CHF 45.1

(-) Goodwill & Intangibles: (3.2) (3.4)
(+) Certain DTAs: (0.9) (0.1)
(+/-) Other Adjustments: (1.4) (6.3)
Common Equity Tier 1 (CET 1): 38.5 35.3
(+) Preferred Stock: - -
(+) AT1 Capital: 15.8 14.7
(+) Qualifying NCI: - -
(+/-) Other Adjustments: - -
Tier 1 Capital: 54.4 50.0

Total Risk-Weighted Assets: 267.8 250.5

Total Tangible Assets: 752.6 528.1
RWAs / Tangible Assets: 35.6% 47.4%

Tangible Common Equity Ratio: 5.4% 7.9%

Common Equity Tier 1 Ratio: 14.4% 14.1%
Tier 1 Capital Ratio: 20.3% 20.0%
Tier 1 Leverage Ratio: 7.2% 9.5%

Liquid Assets: 227.2 120.0

% Cash: 84.1% 93.9%

Stress Net Cash Outflows: 112.2 83.2

% Deposits: 28.6% 35.7%

Liquidity Coverage Ratio (LCR): 202.6% 144.2%

Net Loans / Total Assets: 38.6% 49.7%

Deposits / Total Liabilities & Equity: 52.0% 43.9%
Net Loans / Deposits: 74.3% 113.3%