What is the bank net interest income

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-A bank invested $50 million in a two-year asset paying 10 percent interest per year and simultaneously issued a $50 million, one-year liability paying 8 percent interest per year to pay for it.

-Is the bank short funded or long funded?

-What is the bank's net interest income in year one?

-What will be the bank's net interest income in year two if at the end of the first year all interest rates have decreased by 1.5 percent (150 basis points)?

Reference no: EM132796024

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