29 Duration Pillow Private Bank has the following market value balance sheet: Asset or Liability Market Value

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29 Duration Pillow Private Bank has the following market value balance sheet:

Asset or Liability Market Value (in £ billions) Duration (in years)

Government deposits 28 0 Trade receivables 580 1.20 Short-term loans 390 2.65 Long-term loans 84 7.25 Mortgages 315 16.25 Liabilities Chequing and savings deposits 520 0 Certificates of deposit 340 2.60 Long-term financing 260 17.80 Equity 277 N/A

(a) What is the duration of the assets?

(b) What is the duration of the liabilities?

(c) Is the bank immune from interest rate risk?

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Corporate Finance

ISBN: 9781526848093

4th Edition

Authors: David Hillier

Question Posted: Jul 19, 2024 05:04 PM

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29 Duration Pillow Private Bank has the following market value balance sheet: Asset or Liability Market Value

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Corporate Finance

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