Question

In: Finance

Question 18 What is the Duration Gap for the bank balance sheet shown below? Assets Amount...

Question 18

What is the Duration Gap for the bank balance sheet shown below?

Assets

Amount

Duration

Liabilities and Equity

Amount

Duration

Cash

80

0.00

Non-interest deposits

100

0.00

Securities

270

4.25

NOW checking

170

1.00

Loans, net

600

4.75

MMDA

330

0.25

Fed funds sold

0

CDs

160

1.75

Non-earning assets

50

Fed Funds purchased

150

0.00

$1,000

Equity

90

$1,000
A.

3.9975 years
B.

3.465 years
C.

6.00 years
D.

0.5852 years
E.

3.41 years

Solutions

Expert Solution

jeff jeffy answered 8 months ago
Next > < Previous

Related Solutions

Question 21 What is the Duration Gap for the bank balance sheet shown below? Assets Amount...
Question 21 What is the Duration Gap for the bank balance sheet shown below? Assets Amount Duration Liabilities and Equity Amount Duration Cash 80 0.00 Non-interest deposits 150 0.00 Securities 300 4.00 NOW checking 150 1.50 Loans, net 570 5.00 MMDA 300 0.25 Fed funds sold 0 CDs 170 2.00 Non-earning assets 50 Fed Funds purchased 150 0.00 $1,000 Equity 80 $1,000 A. 3.41 years B. 4.05 years C. 3.35 years D. 5.25 years E. 0.70 years
The financial statements for THE Bank are shown below: Balance Sheet THE Bank Assets Liabilities and...
The financial statements for THE Bank are shown below: Balance Sheet THE Bank Assets Liabilities and Equity Cash $ 220 Demand deposits $ 2,470 Demand deposits from other FIs 620 Small time deposits 4,820 Investments 1,820 Jumbo CDs 1,445 Federal funds sold 920 Federal funds purchased 1,020 Loans 6,920 Equity 815 Reserve for loan losses (700 ) Premises 770 Total assets $ 10,570 Total liabilities/equity $ 10,570 Income Statement THE Bank Interest income $ 2,470 Interest expense 1,650 Provision for...
The financial statements for THE Bank are shown below: Balance Sheet THE Bank Assets Liabilities and...
The financial statements for THE Bank are shown below: Balance Sheet THE Bank Assets Liabilities and Equity Cash $ 220 Demand deposits $ 2,470 Demand deposits from other FIs 620 Small time deposits 4,820 Investments 1,820 Jumbo CDs 1,445 Federal funds sold 920 Federal funds purchased 1,020 Loans 6,920 Equity 815 Reserve for loan losses (700 ) Premises 770 Total assets $ 10,570 Total liabilities/equity $ 10,570 Income Statement THE Bank Interest income $ 2,470 Interest expense 1,650 Provision for...
The financial statements for THE Bank are shown below: Balance Sheet THE Bank Assets Liabilities and...
The financial statements for THE Bank are shown below: Balance Sheet THE Bank Assets Liabilities and Equity Cash $ 280 Demand deposits $ 2,530 Demand deposits from other FIs 680 Small time deposits 4,880 Investments 1,880 Jumbo CDs 1,505 Federal funds sold 980 Federal funds purchased 1,080 Loans 6,980 Equity 735 Reserve for loan losses (900 ) Premises 830 Total assets $ 10,730 Total liabilities/equity $ 10,730 Income Statement THE Bank Interest income $ 2,490 Interest expense 1,710 Provision for...
The financial statements for THE Bank are shown below: Balance Sheet THE Bank Assets Liabilities and...
The financial statements for THE Bank are shown below: Balance Sheet THE Bank Assets Liabilities and Equity Cash $ 260 Demand deposits $ 2,510 Demand deposits from other FIs 660 Small time deposits 4,860 Investments 1,860 Jumbo CDs 1,485 Federal funds sold 960 Federal funds purchased 1,060 Loans 6,960 Equity 895 Reserve for loan losses (700 ) Premises 810 Total assets $ 10,810 Total liabilities/equity $ 10,810 Income Statement THE Bank Interest income $ 2,470 Interest expense 1,690 Provision for...
What is the duration GAP of a bank whose assets and liabilities are as follows? Assets:...
What is the duration GAP of a bank whose assets and liabilities are as follows? Assets: Cash $48 million Short-term Investments (D=0.8) $149 million Short-term Loans (D=0.6) $201 million Long-term Investments (D=4.2) $254 million Long-term Loans (D=6.2) $398 million Liabilities: Demand Deposits $46 million Short-term Interest-bearing Deposits (D=0.3) $595 million CDs (D=2.5) $148 million Borrowed funds (D=0.1) $153 million Round to three decimals.
What is the duration GAP of a bank whose assets and liabilities are as follows? Assets:...
What is the duration GAP of a bank whose assets and liabilities are as follows? Assets: Cash $52 million Short-term Investments (D=0.4) $153 million Short-term Loans (D=0.8) $201 million Long-term Investments (D=3.8) $247 million Long-term Loans (D=5.2) $400 million Liabilities: Demand Deposits $46 million Short-term Interest-bearing Deposits (D=0.3) $592 million CDs (D=2.8) $148 million Borrowed funds (D=0.1) $151 million Round to three decimals.
Consider the balance sheet for the Georgia bank as presented below. Georgia Bank Balance Sheet Assets...
Consider the balance sheet for the Georgia bank as presented below. Georgia Bank Balance Sheet Assets Liabilities Government securities $1,600 Checking accounts $4,000 Required Reserves $400 Net Worth $1,000 Excess Reserves $0 Loans $3,000 Total Assets $5,000 Total Liabilities $5,000 Using a required reserve ratio of 10% and if the bank keeps no excess reserves, write the changes to the balance sheet for each of the following scenarios: Steve withdraws $200 from his checking account. The Fed buys $2,000 in...
Consider the balance sheet for the Wahoo bank as presented below. Wahoo Bank Balance Sheet Assets...
Consider the balance sheet for the Wahoo bank as presented below. Wahoo Bank Balance Sheet Assets Liabilities government securities $1,600 Liabilities:                     Checking accounts $4,000 Required Reserves $400 Net Worth $1,000 Excess Reserves $0 Loans $3,000 Total Assets $5,000 Total Liabilities $5,000 Using a required reserve ratio of 10% and assuming that the bank keeps no excess reserves, write the changes to the balance sheet for each of the following scenarios: Bennett withdraws $500 from his checking account. The Fed buys...
Consider a bank with the following balance sheet (M means million): Assets Value Duration of the...
Consider a bank with the following balance sheet (M means million): Assets Value Duration of the Asset Convexity of the Asset 5yr bond bought at a yield of 3.4% (lending money) $550M 4.562 12.026 12yr bond bought at a yield of 4% (lending money) $800M 9.453 53.565 Liabilities Value Duration of the Liability Convexity of the Liability 2yr bond sold at a yield of 2.4% (borrowing money) $300M 1.941 2.384 4yr bond sold at a yield of 2.8% (borrowing money)...
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT