Question
A bank has the following balance sheet: Assets Return Million $ Liabilities and Equity Cost Millions $ Cash 0.00 % $ 35 Fixed-rate deposits 3.50
A bank has the following balance sheet:
Assets | Return | Million $ | Liabilities and Equity | Cost | Millions $ |
| ||||||||||||||||
Cash |
| 0.00 | % |
| $ | 35 |
|
| Fixed-rate deposits |
| 3.50 | % |
| $ | 240 |
|
| |||||
Investments (< 1 year) |
| 4.00 | % |
| $ | 200 |
|
| Rate-sensitive deposits |
| 2.00 | % |
| $ | 260 |
|
| |||||
Short-term loans (< 1 year) |
| 6.00 | % |
| $ | 225 |
|
| Fed fund borrowings |
| 2.50 | % |
| $ | 25 |
|
| |||||
Long-term fixed-rate loans (maturity > 1 year) |
| 6.75 | % |
| $ | 250 |
|
| Long-term borrowings at fixed rate (maturity > 1 year) |
| 5.50 | % |
| $ | 119 |
|
| |||||
|
|
|
|
|
|
|
|
| Equity |
|
|
|
| $ | 66 |
|
| |||||
Total |
|
|
|
| $ | 710 |
|
| Total |
|
|
|
| $ | 710 |
|
| |||||
For a nine-month maturity bucket, the bank has ________ in fixed-rate assets and ________ in fixed-rate liabilities.
A) $425; $285
B) $285; $425
C) $285; $359
D) $359; $285
E) $250; $66
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