Calculate the repricing gap and the impact on net interest


Consider the following balance sheet positions for a financial institution:

*Rate-sensitive assets = $200 million

Rate-sensitive liabilities = $100 million

*Rate-sensitive assets = $100 million

Rate-sensitive liabilities = $150 million

*Rate-sensitive assets = $150 million

Rate-sensitive liabilities = $140 million

a .Calculate the repricing gap and the impact on net interest income of a 1percent increase in interest rates for each position.

b. Calculate the impact on net interest income of each of the above situations, assuming a 1 percent decrease in interest rates.

c. What conclusion can you draw about the repricing model from these results?

Solution Preview :

Prepared by a verified Expert
Macroeconomics: Calculate the repricing gap and the impact on net interest
Reference No:- TGS0656178

Now Priced at $30 (50% Discount)

Recommended (96%)

Rated (4.8/5)