Question

Use the following information to answer questions 3 through 6.

Farmers State Bank of Mumford is currently assessing interest rate risk. The information compiled includes the following items:                                                        

Fixed-rate loans maturing in 6 months                                  5,000,000

Fixed-rate loans maturing in 12 months                                12,000,000

All other fixed-rate loans                                                      75,000,000

Fixed rate securities maturing in 6 months                            15,000,000

Fixed rate securities maturing in 12 months                          12,000,000

All other fixed-rate securities                                                   5,000,000

Variable rate loans maturing in 6 months                              12,500,000

Variable rate loans maturing in 12 months                            32,500,000

All other variable-rate loans                                                  45,000,000

Federal funds sold                                                                 66,000,000

NOW accounts                                                                      35,000,000

Money Market Deposit Accounts (MMDA)                          15,000,000

Federal funds purchased                                                       10,000,000

Passbook savings accounts                                                        750,000

3 month certificates of deposit (CDs)                                    46,000,000

6 month certificates of deposit (CDs)                                    69,000,000

1 year certificates of deposit (CDs)                                       27,600,000

5 year certificates of deposit (CDs)                                       41,400,000

All variable rate loans at Farmers State Bank are repriced at the beginning of each month. Federal funds sold and purchased are repriced daily. Interest rates on passbook savings accounts can change once a year. Interest rates on NOW and MMDA accounts change daily.

1. Categorize each of the items from Farmers State Bank into assets and liabilities. Circle the assets.  
2. Next, categorize assets into:

RSA 0 to 6 month repricing,                $____________

RSA 7 to 12 month repricing               $____________

All other assets.                                   $____________

Categorize liabilities into:

RSL 0 to 6 month repricing                  $___________

RSL 7 to 12 month repricing                $___________

All other liabilities.                              $___________

Answer 1

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