The financial statement below is for the current year. After you review the data, calculate the duration gap for the bank. Second National Bank Duration Duration Assets (in years) Liabilities (in years) Reserves $5,000,000 0.00 Checkable deposits $15,000,000 2.00 Securities Money market deposits 5,000,000 0.10 5,000,000 0.40 Savings accounts 15,000,000 1.00 1 to 2 years 5,000,000 1.60 CDs > 2 years 10,000,000 7.00 Variable rate 10,000,000 0.50 Residential mortgages 15,000,000 0.20 Variable rate 10,000,000 0.50 1 to 2 years 5,000,000 1.20 Fixed rate 10,000,000 6.00 > 2 years 5,000,000 2.70 Commercial loans Interbank loans 5,000,000 0.00 15,000,000 0.70 Borrowings 1 to 2 years 10,000,000 1.40 10,000,000 0.30 > 2 years 25,000,000 4.00 1 to 2 years 5,000,000 1.30 Buildings, etc. 5,000,000 0.00 > 2 years 5,000,000 3.10 Bank capital 5,000,000 Total $100,000,000 Total $100,000,000 For Problems 16–23, assume that the First National Bank initially has the balance sheet shown on page 573 and that interest rates are initially at 10%.

The financial statement below is for the current year. After you review the data, calculate the duration gap for the bank. Second National Bank Duration Duration Assets (in years) Liabilities (in...

The financial statement below is for the current year. After you review the data, calculate the duration gap for the bank.

	Second National Bank
	Duration			Duration
Assets	(in years)		Liabilities	(in years)
Reserves	$5,000,000	0.00	Checkable deposits	$15,000,000	2.00
Securities			Money market deposits	5,000,000	0.10
< 1="">	5,000,000	0.40	Savings accounts	15,000,000	1.00
1 to 2 years	5,000,000	1.60	CDs
> 2 years	10,000,000	7.00	Variable rate	10,000,000	0.50
Residential mortgages			< 1="">	15,000,000	0.20
Variable rate	10,000,000	0.50	1 to 2 years	5,000,000	1.20
Fixed rate	10,000,000	6.00	> 2 years	5,000,000	2.70
Commercial loans			Interbank loans	5,000,000	0.00
< 1="">	15,000,000	0.70	Borrowings
1 to 2 years	10,000,000	1.40	< 1="">	10,000,000	0.30
> 2 years	25,000,000	4.00	1 to 2 years	5,000,000	1.30
Buildings, etc.	5,000,000	0.00	> 2 years	5,000,000	3.10
			Bank capital	5,000,000
Total	$100,000,000		Total	$100,000,000

For Problems 16–23, assume that the First National Bank initially has the balance sheet shown on page 573 and that interest rates are initially at 10%.

May 24, 2022

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The financial statement below is for the current year. After you review the data, calculate the duration gap for the bank. Second National Bank Duration Duration Assets (in years) Liabilities (in...

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