Portfolio Benefits of Bank-Qualified Bonds - AFG

Therefore, a bank’s taxable equivalent yield (TEY) can be calculated as: For example, Bank XYZ has an interest expense to average assets of 1.37%, marginal tax rate of 35%, and is looking to purchase a bank-qualified municipal bond yielding 4.00%. Substituting into the formulas: Portfolio Benefits of Bank-Qualified Bonds “There is no such thing ................
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