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Assume that Regions Savings Bank, a bank with $250 million in total assets, has determined that its leverage-adjusted duration GAP was 2.50. The board of
Assume that Regions Savings Bank, a bank with $250 million in total assets, has determined that its leverage-adjusted duration GAP was 2.50. The board of directors is concerned that interest rates would soon be increasing substantially across the board; in fact, they wish to plan for a 1% increase in interest rates over the next year. The board has come to you to provide a short report of how the bank might approach this situation. Provide a summary of the choices for managing the bank
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