Which of the following are rate-sensitive liabilities?
A)Short-term consumer loans, cheque accounts and three-month Treasury Notes
B)Three-month term deposits, three-month bankers' acceptances, six-month negotiable certificates of deposit and one-year term deposits
C)Short-term consumer loans, six-month negotiable certificates of deposit and one-year term deposits.
D)Short-term consumer loans, six-month Treasury Notes and three-year Treasury Bonds

Question

Quizplus · Accepted Answer

Rate-sensitive liabilities refer to those liabilities that reprice or mature within a short period of time and hence are sensitive to changes in interest rates. Three-month term deposits, three-month bankers' acceptances, six-month negotiable certificates of deposit, and one-year term deposits are all examples of rate-sensitive liabilities as they mature or reprice within a short period of time. Short-term consumer loans typically have fixed interest rates and are not rate-sensitive liabilities. Treasury notes and bonds have longer maturities and hence are not considered rate-sensitive liabilities.

Which of the Following Are Rate-Sensitive Liabilities