BMGT 445 lecture 4 part 1

BMGT 445 lecture 4 part 1 - BMGT445 ProfessorEthanCohenCole

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Click to edit Master subtitle style 3/1/11 BMGT 445 Professor Ethan Cohen-Cole Lecture 4
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3/1/11 Key concepts Interest Rate Risk
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3/1/11 IRR 1 Fed Policy Repricing Maturity Duration Interest rates reflect supply and demand for loanable funds Shifts in supply or demand generate interest rate
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3/1/11 IRR 1 Fed Policy Repricing Maturity Duration Federal Reserve Bank: U.S. central bank Open market operations influence money supply, inflation, and
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3/1/11 IRR 1 Fed Policy Repricing Maturity Duration Consider a bank with one assets and one liability: Asset: Corporate Loan. Company pays Fed Funds (see
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3/1/11 IRR 1 Fed Policy Repricing Maturity Duration Repricing or funding gap model based on book value. Contrasts with market value- based maturity and duration models Rate sensitivity
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IRR 1 Fed Policy Repricing Maturity Duration Assets Liabilities Gap Cum. Gap
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This note was uploaded on 02/28/2011 for the course BMGT 445 taught by Professor Malmquist during the Spring '09 term at Maryland.

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BMGT 445 lecture 4 part 1 - BMGT445 ProfessorEthanCohenCole

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