Interest gap: Difference between revisions
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imported>Doug Williamson (Add link.) |
imported>Doug Williamson (Add links.) |
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== See also == | == See also == | ||
* [[Assets]] | * [[Assets]] | ||
* [[Behavioural gap]] | |||
* [[Contractual gap]] | |||
* [[Gap report]] | * [[Gap report]] | ||
* [[Interest gap report]] | * [[Interest gap report]] | ||
Revision as of 11:44, 29 October 2016
A mismatch in the timing at which interest rate assets and liabilities are repriced.
A positive gap (assets repricing more quickly than liabilities) means an exposure to falling interest rates and vice versa.
Banks and other financial institutions commonly have a 'structural' interest gap, resulting from the nature of their business and the structure of their balance sheets.
This structural interest gap is usually negative.
The negative interest gap results from shorter-term liabilities funding longer term assets.
