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The Average Duration of the Loans Is 10 Years What Is the Net Gain or Loss on the Loan

question 59

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The average duration of the loans is 10 years.The average duration of the deposits is 3 years.  Consumer loans $50 million Deposits $235 million  Commercial Loans $200 million Equity $15 million  Total Assets $250 million Total Liabilities & Equity $250 million \begin{array}{llr}\text { Consumer loans } & \$ 50 \text { million Deposits } & \$ 235 \text { million } \\\text { Commercial Loans } & \$ 200 \text { million Equity } & \$ 15 \text { million } \\\text { Total Assets } & \$ 250 \text { million Total Liabilities \& Equity } & \$ 250 \text { million }\end{array}
What is the net gain or loss on the loan given that the exchange rates at the time of repayment were $1.63/ \le in the cash market and 1.62/ \le in the futures market? Assume that the futures position is opened and unwound as stated in previous question.


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