Savings institutions (savings banks and savings and loans) are predominantly home mortgage and real estate loan lenders. Hence, at times they have greater interest rate risk than other depository institutions, since home mortgages can be fixed rate with longer maturities, and are generally primarily financed by shorter-term deposits, resulting in a negative funding gap.

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Savings institutions tend to have higher interest rate risk due to the nature of their lending focusing on home mortgages and real estate loans, which often have longer maturities and are financed by shorter-term deposits, resulting in a negative funding gap.

Savings Institutions (Savings Banks and Savings and Loans) Are Predominantly