Regulators calculate that DLC bank (see Section 2.2) will report a profit that is normally distributed with a mean of $0.6 million and a standard deviation of $2.0 million. How much equity capital in addition to that in Table 2.2 should regulators require for there to be 99.9% chance of the capital not being wiped out by losses?Table 2.2:Summary of Balance Sheet for DLC at End of 2012 ($millions)Assets:Cash 5Marketable Securities 10Loans 80Fixed Assets 5Total 100Liabilities and Net Worth:Deposits 90Subordinated Long-Term Debt 5Equity Capital 5Total 100Table 2.3: Summary Income Statement for DLC in 2012 ($ millions)Net interest income 3.00Loan Losses (0.80)Non-interest income 0.90Non-interest expense (2.50)Pre-tax operating income 0.60

Regulators calculate that DLC bank (see Section 2.2) will report a profit that is normally distributed with a mean of $0.6 million and a standard deviation of $2.0 million. How much equity capital in addition to that in Table 2.2 should regulators require for there to be 99.9% chance of the capital not being wiped out by losses?Table 2.2:Summary of Balance Sheet for DLC at End of 2012 ($millions)Assets:Cash 5Marketable Securities 10Loans 80Fixed Assets 5Total 100Liabilities and Net Worth:Deposits 90Subordinated Long-Term Debt 5Equity Capital 5Total 100Table 2.3: Summary Income Statement for DLC in 2012 ($ millions)Net interest income 3.00Loan Losses (0.80)Non-interest income 0.90Non-interest expense (2.50)Pre-tax operating income 0.60

Regulators calculate that DLC bank (see Section 2.2) will report a profit that is normally distributed with a mean of $0.6 million and a standard deviation of $2.0 million. How much equity capital in addition to that in Table 2.2 should regulators require for there to be 99.9% chance of the capital not being wiped out by losses?Table 2.2:Summary of Balance Sheet for DLC at End of 2012 ($millions)Assets:Cash 5Marketable Securities 10Loans 80Fixed Assets 5Total 100Liabilities and Net Worth:Deposits 90Subordinated Long-Term Debt 5Equity Capital 5Total 100Table 2.3: Summary Income Statement for DLC in 2012 ($ millions)Net interest income 3.00Loan Losses (0.80)Non-interest income 0.90Non-interest expense (2.50)Pre-tax operating income 0.60