Calculate the existing Dollar Gap for the bank. Next, calculate the effect (change) on this bank's Net Interest

Income if interest rates fall or decrease by 1 percentage point or 100 bp. "%" denotes either the current

interest rate earned earned or paid on the designated asset or liability category. RSA and RSL denote interest

rate sensitive assets and liabilities, respectively, that are repriced within one year. Note, you do not have to

include either the existing or new level of Net Interest Income, as I'm only asking for the change in Net Interest

Income. Please show your work in order to receive credit.

Assets

Amount

%

RSA

Liabilities and Equity

Amount

%

RSL

Cash

80

0.0%

Non-interest deposits

100

0.0%

Securities

250

6.0%

100

NOW checking

200

2.0%

Loans, net

620

7.0%

248

MMDA

300

4.0%

300

Fed funds sold

0

CDs

150

5.0%

75

Non-earning assets

50

Fed Funds purchased

150

3.0%

150

$1,000

Equity

100

$1,000