Explain your position on the following statement: "Precise identification of the repricing characteristics of each of the assets and liabilities of a bank is possible."

While identifying the repricing characteristics of assets and liabilities is crucial to management of interest rate risk, there are a number of assets and liabilities for which this is quite difficult.For example, any asset that is callable is difficult to measure in terms of its repricing characteristics.Mortgages are perhaps the best example, whereby prepayments change dramatically with interest rate changes.Also, while demand deposits do not pay interest, the amount of demand deposits does vary with interest rate movements