A bank pays a floating rate of interest on deposits (i.e. liabilities) and earns a fixed rate
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Question:
A bank pays a floating rate of interest on deposits (i.e. liabilities) and earns a fixed rate of interest on loans (i.e. assets). This mismatch between assets and liabilities can cause tremendous difficulties.
Explain what type of a swap this bank could use and why? Do you agree with the points made in the videos? Justify your answer
https://www.youtube.com/watch?v=uVq384nqWqg
Related Book For
Modern Advanced Accounting In Canada
ISBN: 9781259066481
7th Edition
Authors: Hilton Murray, Herauf Darrell
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