QUESTION 4B. INTEREST RATE RISK (7 MARKS) Bank of Matheson's current repricing gap is illustrated in the following diagram: ANII ANII = CGAP X (AI) Ai (i) Is Bank of Matheson asset-sensitive or liability-sensitive? Explain your answer. (3 marks) (ii) Bank of Matheson anticipates falling interest rates and bank managers are adopting an active (aggressive) risk management approach. What specific balance sheet adjustments will be appropriate for this bank? (4 marks) QUESTION 4B. INTEREST RATE RISK (7 MARKS) Bank of Matheson's current repricing gap is illustrated in the following diagram: ANII ANII = CGAP X (AI) Ai (i) Is Bank of Matheson asset-sensitive or liability-sensitive? Explain your answer. (3 marks) (ii) Bank of Matheson anticipates falling interest rates and bank managers are adopting an active (aggressive) risk management approach. What specific balance sheet adjustments will be appropriate for this bank? (4 marks)