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cash and treasury securities $100 million fed funds sold $100 million residential mortgages 1-4 family $200 million commercial loans $600 million note: the residential mortgages all have a loan-to-value of between 60 and 80 percent. if the bank has capital of $50 million, what is the leverage ratio using the standardized approach?

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The leverage ratio using the standardized approach is  $20 million.

To calculate the leverage ratio using the standardized approach, you need to add up the total on-balance sheet assets of the bank and divide it by the capital of the bank. On-balance sheet assets are those that are directly recorded on the bank's balance sheet and include cash, treasury securities, residential mortgages, and commercial loans.

In this case, the total on-balance sheet assets of the bank are $100 million + $100 million + $200 million + $600 million = $1,000 million.

The leverage ratio is calculated by dividing the total on-balance sheet assets by the capital of the bank, which is $50 million.

Therefore, the leverage ratio using the standardized approach is $1,000 million / $50 million = 20.

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