Net interest margin tends to rise for U.S.banks having positive maturity gap positions when the yield curve is upward-sloping.

Question

Quizplus · Accepted Answer

When the yield curve is upward-sloping, longer-term interest rates are higher than short-term rates. Banks with positive maturity gap positions can take advantage of this by obtaining funding at lower short-term rates and lending at higher long-term rates, resulting in higher net interest margins.

Net Interest Margin Tends to Rise for U