Question
A bank issues a $3 million commercial mortgage with a nominal APR of 8%. The loan is fully amortized over 10 years requiring monthly payments.
A bank issues a $3 million commercial mortgage with a nominal APR of 8%. The loan is fully amortized over 10 years requiring monthly payments. The bank plans on selling the loan after 2 months. If the required nominal APR increases by 45 basis points when the loan is sold, how much is the gain/loss that to the bank?
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Fixed Income Securities Tools For Todays Markets
Authors: Bruce Tuckman, Angel Serrat
4th Edition
1119835550, 978-1119835554
