Question: Discuss what impact each of the following will have in

Discuss what impact each of the following will have, in general, on EVE sensitivity to a change in interest rates. Consider two cases where rates rise sharply and fall sharply.
a. Bank owns a high percentage of assets in bonds that are callable anytime after three months.
b. Bank pays below market rates on TDs, and market interest rates move sharply higher. c. A large percentage of the bank’s assets are in 30 year fixed rate mortgages.

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  • CreatedNovember 03, 2015
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