1. ) Boston Bank has the following interest rates and sensitivity position. What is the current net interest margin (NIM)? What is the 90-day interest sensitivity gap? If rates increase by 200 basis points in 365 days, does the NIM likely increase, decrease, or stay the same during that 365-day period?

0-90 days 91-365 days 1 year+

Earning Assets $mm rate(%) $mm rate(%) $mm rate(%) weighted avg. rates(%)

Loans 170 6.70 140 6.40 90 6.00 6.44

Investments 50 3.30 50 3.00 40 2.90 3.08

Cost Liabilities

MMA/Savings 20 1.80 60 1.80 30 1.80 1.80

3-5 Yr CDs 250 2.60 80 2.20 70 2.10 2.43