Question: QUESTION 2 ( b ) ( i ) [ 5 marks ] Using the yield curve ( depicted below, ) discuss the net interest margin

QUESTION

2 (

) (

) [5

marks

]

Using the yield curve

(

depicted below,

)

discuss the net interest margin given that a five

-

year loan is financed by rolling over the one

-

year certificate of deposits. You should discuss and label the relevant risks that are experienced by the bank with this profile. Does the shape of the yield curve approximate the expected yield curve for the current Singapore market?

QUESTION 2(b)(i)[5 marks] Using the yield curve (depicted below,) discuss the

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