An FI with a Positive Gap of $30 Million Suffers

question 69

True/False

An FI with a positive gap of $30 million suffers a $0.15 million decrease in its net interest income if interest rates increase by 0.5 per cent.

---

Definitions:

Consolidation Adjustments

Adjustments made in the preparation of consolidated financial statements to eliminate intercompany transactions and balances among the parent and its subsidiaries.

Consolidated Financial Statements

Financial statements that aggregate the assets, liabilities, and operating results of a parent company and its subsidiaries, providing a complete financial view of the corporate group.

Shareholders

Individuals or entities that own shares in a corporation, making them owners of the company to the extent of the shares held.

Parent Company

A company that holds a controlling interest in one or more subsidiaries.