An investment bank agrees to underwrite a $100,000,000 8 year 7% semiannual bond issue for X Corporation. If interest rates rise 0.03% or 3 basis points overnight, what will be the impact on the profits of the investment bank? How much will they be impacted by? (give number)
Match the liability structure of a bank with the maturity structure of the asset portfolio. Describe the new risks or increase in existing risk by any difference in liability versus maturity structure.