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The following is the balance sheet of Boston Bank. The average maturity of demand deposits is estimated at 2 years. Face Value Runoff <1 year
The following is the balance sheet of Boston Bank. The average maturity of demand deposits is estimated at 2 years. Face Value Runoff <1 year Face Value Runoff <1 year 3-mo. T-Bills $60m Demand Dep. $180m 10 percent 2-yr Bonds $60m 5 percent Equity $20m 5-yr Bonds $80m 10 percent What is the repricing gap if a 3-year maturity gap is used? Ignore runoffs.
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