Question: calculate the rate sensitive assests and liabilities? Section 2 (Managing Interest-Rate Risk) Financial institutions, banks in particular, specialize in earning a higher rate of return

calculate the rate sensitive assests and liabilities? calculate the rate sensitive assests and liabilities? Section 2 (Managing Interest-Rate Risk)

Section 2 (Managing Interest-Rate Risk) Financial institutions, banks in particular, specialize in earning a higher rate of return on their assets relative to the interest paid on their liabilities. Below is a would be example of a Balance sheet from CIMB bank. Use the Income GAP analysis to answer the questions. Assets include assets with maturity less than one year, variable-rate mortgages, short- term commercial loans, portion of fixed-rate mortgages (say 10%) Liabilities include money market deposits, variable-rate CDs, short-term CDs, federal funds, short-term borrowings, portion of checkable deposits (20%) and a portion of savings (10%) CIMB Bank Balance Sheet Assets Reserves and Cash Items Million RM 20 5 20 Securities Less than 1 year 1 to 2 years Greater than 2 years 10 15 5 Residential mortgages Million RM Liabilities 5 Checkable deposits Money Market Deposit accounts 25 Savings Deposits 5 CDs 10 Variable rate Less than 1 year 1 to 2 years Greater than 2 20 years 20 Fed Funds Borrowings 15 Less than 1 year 10 1 to 2 years Greater than 2 25 years 5 Bank Capital 140 Total 20 5 Variable rate Fixed rate (30 year) Commercial Loans Less than 1 year 1 to 2 years 15 10 Greater than 2 years Physical capital Total Questions 5 10 140 Section 2 (Managing Interest-Rate Risk) Financial institutions, banks in particular, specialize in earning a higher rate of return on their assets relative to the interest paid on their liabilities. Below is a would be example of a Balance sheet from CIMB bank. Use the Income GAP analysis to answer the questions. Assets include assets with maturity less than one year, variable-rate mortgages, short- term commercial loans, portion of fixed-rate mortgages (say 10%) Liabilities include money market deposits, variable-rate CDs, short-term CDs, federal funds, short-term borrowings, portion of checkable deposits (20%) and a portion of savings (10%) CIMB Bank Balance Sheet Assets Reserves and Cash Items Million RM 20 5 20 Securities Less than 1 year 1 to 2 years Greater than 2 years 10 15 5 Residential mortgages Million RM Liabilities 5 Checkable deposits Money Market Deposit accounts 25 Savings Deposits 5 CDs 10 Variable rate Less than 1 year 1 to 2 years Greater than 2 20 years 20 Fed Funds Borrowings 15 Less than 1 year 10 1 to 2 years Greater than 2 25 years 5 Bank Capital 140 Total 20 5 Variable rate Fixed rate (30 year) Commercial Loans Less than 1 year 1 to 2 years 15 10 Greater than 2 years Physical capital Total Questions 5 10 140

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