A bank's net interest margin will likely decline if it has a large amount of

Name: A bank's net interest margin will likely decline if it has a large amount of
Brand: Quizplus
Rating: 4.8 (43 reviews)

Question

Quizplus · Accepted Answer

A bank's net interest margin will likely decline if it has a large amount of rate-sensitive assets and no rate-sensitive liabilities. This is because when interest rates rise, the bank will have to pay more interest on its liabilities, but it will not be able to charge more interest on its assets.

A Bank's Net Interest Margin Will Likely Decline If It