Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. finance
  3. a bank finds that its assets are not matched with

A bank finds that its assets are not matched with its liabilities. It is taking floating-rate...

60.1K

Verified Solution

Question

Finance

A bank finds that its assets are not matched with itsliabilities. It is taking floating-rate deposits and making fixed-rate loans. How can swaps be used to offset the risk?

Answer & Explanation Solved by verified expert
4.4 Ratings (741 Votes)
Since bank is accepting floating rate deposits and making fixed rate loans it is facing market fluctuation risk To avoid this risk bank should offer swap quotations and start accepting fixed rate deposits    See Answer
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students

Q

Use linear regression to find a function that fits the following points.(-2,-4), (8,1)y = [___]...

Algebra
Q

According to the Common Policy Conditions, under whatcircumstances can the insured transfer rights or...

Accounting
Q

Write the complete molecular equation (CME), the complete ionic equation (CIE), and the net ionic equation (NIE)...

Chemistry
Q

3.70 kg / min of air as ideal gas enters a steady state compressor that runs...

Physics
Q

What are volatile organic compounds Carbon based liquids that quickly evaporate Colorless gasses that have...

Biology
Q

5 The Electric Field Lines are a Symmetric b Not symmetric c Linear d No...

Physics
Q

Find the value of a For the circle the dot represents the center 17 20

Geometry
Q

Find the range and the standard deviation correct to two decimal places 6 7 8...

Basic Math
Q

Find the average rate of change of g (x)=2x +8 from x=2 to x =...

Basic Math
Q

Please help with the explanation will rate. Entry for Jobs Completed; Cost of Unfinished...

Accounting
Q

Which of the following characteristics is relevant to process costing but not to job order...

Accounting
Q

Northwood Company manufactures basketballs. The company has a ball that sells for $35. At present,...

Accounting