Interest rate risk: Difference between revisions
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* [[Portfolio hedging]] | * [[Portfolio hedging]] | ||
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* [[Shock]] | * [[Shock]] | ||
* [[Time bins]] | * [[Time bins]] | ||
Revision as of 20:15, 5 February 2018
The risk associated with a change in interest rates.
This may take several forms in the treasury context.
For example, and depending on the direction of the change:
- Increasing interest cost
- Falling interest income
- Changing market value of debt, or of pension liabilities
- Differences in competitiveness
- The changing nature of a market when interest rates change
- Secondary effects, especially potentially adverse effects, resulting from any of the primary effects above. For example, potential breaches of interest cover covenants.
Sometimes written 'interest-rate risk'.
See also
- Asset-liability management
- Double-whammy
- Exposure
- Fair value interest rate risk
- Financial covenant
- Guide to risk management
- Interest cover
- Interest rate
- IRHP
- IRRBB
- Matching
- Pipeline risk
- Portfolio hedging
- Risk-free rate of return
- Shock
- Time bins
