Bank runs an FRA book, so it both buys and sells FRAs. It quotes a higher FRA rate to the buyer (borrower) and a lower FRA rate to the seller (investor) and earns the spread.

The bank offers the following FRA quotations:

Bank as seller = 10.50%

Bank as buyerr= 10.10%

What is the return in dollars the bank can make of running the above FRA book under the following terms? ( use 2 decimals)

Nominal value $1,000,000 Term 90 days Reference rate on the settlement date = 10% per annum