Question
Silverthorne State Bank's balance sheet lists the following assets and liabilities & capital including their corresponding balances: Assets: required reserves $50; commercial loans-floating rate $100;
Silverthorne State Bank's balance sheet lists the following assets and liabilities & capital including their corresponding balances: Assets: required reserves $50; commercial loans-floating rate $100; commercial loans-fixed rate $300; consumer loans $150; mortgages-floating rate $400; mortgages-fixed rate $225; and corporate bonds-AAA rated $75. Liabilities & capital: demand deposits $45; NOW accounts $150; MMDAs $250; CDs (short-term) $500; federal funds purchased $25; and capital $330. Silverthorne wants to assess its interest rate risk. What is the bank's gap?
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started