Bank of the Plain States has been struggling with poor asset quality for some time.
The bank lends primarily to large farming operations that have struggled in recent
years due to a glut of soybeans and corn on the market. Bank regulators have
recently required that the bank write off some of these loans, which has entirely
wiped out the capital of the bank. However, the bank still has some liquidity sources it can use, including a correspondent bank and the Federal Reserve. Bank of the Plain States is:
AAn insolvent but not failed bank.
BBoth a failed bank and an insolvent bank.
CNeither a failed bank nor an insolvent bank.
DA failed bank but not an insolvent bank.
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