Problem
The Agricultural Bank of the Midwest is currently assessing interest rate risk. The information compiled includes the following items:
|
Fixed-rate loans maturing in 6 months
|
4,000,000
|
|
All other fixed-rate loans
|
50,000,000
|
|
Fixed rate securities maturing in 12 months
|
65,000,000
|
|
Variable rate loans maturing in 6 months
|
15,000,000
|
|
All other variable-rate loans
|
50,000,000
|
|
NOW accounts
|
25,000,000
|
|
Federal funds purchased
|
15,000,000
|
|
3-month certificates of deposit (CDs)
|
50,000,000
|
|
1-year certificates of deposit (CDs)
|
35,500,000
|
|
Fixed-rate loans maturing in 12 months
|
20,000,000
|
|
Fixed rate securities maturing in 6 months
|
15,000,000
|
|
All other fixed-rate securities
|
5,000,000
|
|
Variable rate loans maturing in 12 months
|
35,500,000
|
|
Federal funds sold
|
70,000,000
|
|
Money Market Deposit Accounts (MMDA)
|
10,000,000
|
|
Passbook savings accounts
|
1,000,000
|
|
6-month certificates of deposit (CDs)
|
50,000,000
|
|
5-year certificates of deposit (CDs)
|
40,500,000
|
All variable rate loans at The Agricultural Bank of the Midwest are repriced at the beginning of each month. Federal funds sold and purchased are repriced daily. Interest rates on passbook savings accounts can change once a year. Interest rates on NOW and MMDA accounts change daily.
Using Table, determine the 6-month gap ratio at The Agricultural Bank of the Midwest.