INTEREST RATE RISK IN THE BANKING BOOK* pdf

... interest rate risk into two components: traded interest rate risk and non-traded interest rate risk. (The latter is often referred to as interest rate risk on the balance sheet or in the banking ... markets (ie the interest rate risk inherent in an ADI’s ‘trading book’) 3 . ADIs are not required to hold capital against interest rate risk in...

Ngày tải lên: 15/03/2014, 01:20

... interest- rate risk of a bank is to focus on the flow of earnings. This would involve measuring the impact upon the net interest income of a unit change in interest rates. This is sometimes called the ... made in this process, for the accounting year 2001-02, are summarised as follows: • The interest- rate on savings bank deposits: 3.54%. • The interest rate on...

Ngày tải lên: 06/03/2014, 14:20

... decrease in interest rates, and this means that the bank will lose money in the cash market if rates decline. By selling interest rate forwards, futures or by engaging in an interest rate swap in ... decreases in interest rates (Sinkey 2002). Interest rate swaps can thus reduce interest rate risk either by converting a fixed -rate in- come stream to a...

Ngày tải lên: 15/03/2014, 01:20

... solu- tion using this method, we must circumscribe the interest rate rule so that the limiting sum in the solution for the in ation rate in (15) is finite as we look further and further ahead. 13 In the ... real income, and the nominal interest rate. In ation and In ationary Expectations During the 1950s and 1960s, the simple IS model proved inappropriate for...

Ngày tải lên: 06/03/2014, 02:21

... measures, legalized the circulation of 85 For the illuminating discovery that the Jacksonians were interested in purging small bank notes by bringing in gold, see Paul M. O’Leary, The Coinage Legislation ... avoiding the imposition of a crippling tax burden to pay for the interest and principal. There was in this response an awareness by the public that they and their go...

Ngày tải lên: 17/01/2014, 02:20

... bank rates and bank risk, as modern finance theory predicts. Now What? What does this new finding on banking in the 1920s mean for banking in the 1980s? Clearly, much has changed in banking ... assets. The second, more interesting page contains the examiner's remarks on the well-being of the bank. This page contains information analogous to the more form...

Ngày tải lên: 15/02/2014, 05:20

... However, the effect over risk of politicización of the decision making is not clearly defined (La Porta et al., 2002). In one hand, the interest of politicians in conserving the use of the savings ... increase therefore the risk of the Savings bank. 3·. A risk- taking model In order to identify the factors that lead to a financial institution being unable to...

Ngày tải lên: 16/02/2014, 06:20

... (2008) for Germany investigate the determinants of the banks’ exposure to interest rate risk. They find that the belonging to certain banking groups, the banks’ size, their earnings and balance ... source of interest income, and timely changes in earnings from term transformation strongly affect their interest income. However, in the cross-section, the interest marg...

Ngày tải lên: 16/02/2014, 06:20

... securitization of the interest rate risk inherent in long-term assets would have to be engineered in such a way that asset-specific return risks would stay with the intermediary since otherwise the intermediary ... high market rates of interest were depressing property values. High interest rates inducing high default rates and depressing property values were a key ingr...

Ngày tải lên: 17/02/2014, 21:20

... received a single vaccination since their birth. So we had to start right from the beginning.” “Since then, we have seen a positive increase in the interest of the mothers in their children’s ... mobilisers are very involved in the clinic arrangements every month. They visit every house in the area and inform them beforehand of the clinic day. They also come on the...

Ngày tải lên: 05/03/2014, 10:20