"Matching the book" or trying to match the maturities of assets and liabilities is intended to protect the FI from

Question

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Matching the maturities of assets and liabilities is a risk management strategy aimed at reducing interest rate risk. It ensures that an FI has sufficient cash flow to meet its obligations in the short-term and is not exposed to sudden fluctuations in interest rates. While it may also provide some protection against liquidity risk, credit risk, and foreign exchange risk, these are not the primary concerns addressed by matching the book.

"Matching the Book" or Trying to Match the Maturities of Assets