User Account

All Pages

Determine the duration of liabilities

Assignment Help Financial Accounting
Reference no: EM132494163

Point 1: BNP Paribus in Portugal 400 million euros worth of loans with 1-year duration and 400 million euros of loans with a 2-year duration. It has 300 million euros of bonds with a 2-year duration and 100 million euros worth of bonds with a 1-year duration. It has 100 million euros of cash and 200 million in fixed assets.

Point 2: The bank has 500 million in deposits with a 4-year duration and 300 million in checking-type deposits with a 0-year duration. It has issued 400 million of its own bonds (a liability) with a 16-year duration. (yes, I know this is unrealistic, but it to give you practice calculating duration gaps)

Point 3: There are no other assets or liabilities.

Question a. Draw or show the banks balance sheet and determine the value of bank equity

Question b. Determine the duration of assets

Question c. Determine the duration of liabilities

Question d. Calculate the duration gap.

Question e. Is it worried about falling or rising rates based on this duration gap?

Question f. How does it hedge? (what do you buy or sell?)

Reference no: EM132494163

Questions Cloud

Method of the class that initializes string member variables : Question: class Cats with public member variables: Cat name and cat age are required. The following specifications are required:
Explain to pat the four purposes of internal control : Explain to Pat the four purposes of internal control, and give her one application of each purpose for Young Co. Pat Buhn is the new owner of Young Co.
List the weakness in internal control over cash disbursement : At Martinez Company, List the weaknesses in internal control over cash disbursements. Identify improvements for correcting these weaknesses.
What is probability that more than of the business travelers : What is the probability that more than 20% of the business travelers say that the reason for their most recent business trip was a internal company visit?
Determine the duration of liabilities : Draw or show the banks balance sheet and determine the value of bank equity. Is it worried about falling or rising rates based on this duration gap?
What is the proper current price of the investment : If the Federal Reserve has set the risk-free interest rate at 16 percent, what is the proper current price of this investment? What is the price of investment
What allows for internet communication to occur : 1.) What allows for internet communication to occur between continents? 2.) How old is this cabling system?
Approved uses of college computing assets : Most schools have drafted acceptable-use policies for computers and Internet access to inform students and employees of the approved uses of college computing a
Evaluate ibm revenue growth : Evaluate IBM's Revenue growth, Receivables, and Gross margins and over the period. discuss the factors (and trends) that contribute to Big Blue's profitability

Reviews

Write a Review

Financial Accounting Questions & Answers

  Financial statement analysis and preparation

Financial Statement Analysis and Preparation

  Shareholder of a company

Describe the ways that a person can become a shareholder of a company. Why Wal-Mart would split its stock?

  Financial and accounting principles

An understanding of financial and accounting principles can be a valuable tool for managers. While not all managers will find themselves calculating financial ratios or preparing annual financial data.

  Prepare a statement of cash flow using the direct method

Prepare a Statement of Cash Flow using the Direct Method and Prepare the Operations section of the Statement of Cash Flow using the Indirect Method.

  Financial accounting assignment

This assignment has one case study and two question apart from case study. Questions related to document Liquidation question and Company financial statements question - Torquay Limited

  Prepare general journal entries for goela

Prepare general journal entries for Goela Ltd

  Principles of financial accounting

Prepare the journal entry to record the acquisition of the assets.

  Prepare general journal entries to record the transactions

Prepare general journal entries to record the transactions, assuming use of the periodic inventory system

  Global reporting initiative

Compare the view espoused by the economist Milton Friedman about the social responsibilities of business with the views express by Stigler.

  Explain the iasb conceptual frameworks

Explain the IASB Conceptual Framework's perspective of users and their decisions.

  Determine the company''s financial statements

T he focus of the report is to determine the extent to which you are comfortable relying on the financial statements as presented by management .

  Computation of free cash flow

Computation of Free Cash Flow

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +91-977-207-8620

Phone: +91-977-207-8620

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd