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1. Use the balance sheet below to answer the following questions: Assets Short-Term Consumer Loans (one- year maturity) Long-Term Consumer Loans (five- year maturity) 125
1. Use the balance sheet below to answer the following questions: Assets Short-Term Consumer Loans (one- year maturity) Long-Term Consumer Loans (five- year maturity) 125 190 Demand Deposits Passbook Savings Three-Month CDs 35 140 150 Three-Month Treasury Bills Six Month Treasury Bills 3-Year Treasury Bonds 75 35 Six-Month Commerical Paper Six-Month Banker Acceptances 1-Year Time Deposits 5-Year Time Deposits Equity Capital 80 140 135 210 135 10-Year Treasury Bonds 30-Year Floating Rate Bonds (rate adjusted every 2 years) 180 50 70 875 875 Identify the Maturity Gap and the Cumulative Maturity Gap (CGAP) for the following maturity buckets: 3-months, 6-months, 1-year, 5-year, and over 5 years. You may use the table below for organization. a. b. For each maturity bucket, determine whether the CGAP is positive or negative and which type of interest rate risk applies to each (i.e. reinvestment risk or refinancing risk) Maturity Bucket +1 Day to 3-Months +3 Months to 6 Months +6 Months to 12 Months +1 year to 5 Years + 5 Years Assets Liabilities Gap CGAP Risk Type
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