Interest determination date and Interest gap: Difference between pages
From ACT Wiki
(Difference between pages)
imported>Doug Williamson (Classify page.) |
imported>Doug Williamson (Expand.) |
||
Line 1: | Line 1: | ||
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 liabilities. | |||
== See also == | == See also == | ||
* [[ | * [[Assets]] | ||
* [[ | * [[Liabilities]] | ||
Revision as of 20:58, 23 July 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 liabilities.