Which of the following statements is true?
A)An FI with a repricing gap of zero is unsure about interest rate movements.
B)An FI with a repricing gap of zero expects interest rates to rise.
C)An FI with a repricing gap of zero expects interest rates to remain fall.
D)An FI with a repricing gap of zero does not measure and manage its interest rate exposures.

Question

Quizplus · Accepted Answer

An FI with a repricing gap of zero is unsure about interest rate movements because its assets and liabilities mature or repricing at the same time and therefore it does not have any exposure to interest rate risk.

Which of the Following Statements Is True