7-44 To be immunized against foreign currency and foreign interest rate risk,an FI should match both the size and maturities of its foreign assets and foreign liabilities.

Question

Quizplus · Accepted Answer

Matching the size and maturities of foreign assets and liabilities helps an FI to offset potential losses from currency and interest rate fluctuations, thus immunizing against these risks.

7-44 to Be Immunized Against Foreign Currency and Foreign Interest