What will happen to the bank net interest income

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If a bank has 10 billion dollars of 1-year loans and 40 billion dollars of 5-year loans, which are financed by 30 billion dollars of 1-year deposits and 20 billion dollars in 5-year deposits. If interest rates increase by 1 percent every year for the next 3 years, what will happen to the bank's net interest income? Why?

Reference no: EM131179704

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