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How Will Rising Interest Rates Impact Your Bank?
Most of the news coverage about the potential for rising interest rates has assumed rising rates will help banks. But will it help your bank? It turns out, that’s not an automatic yes. This article will help board members understand how interest rates impact a bank’s profitability, and offers questions that you should be asking your management team. Many of the biggest banks in the country, which are the subject of so much news and analyst coverage, are deliberately managed to be asset sensitive. That means that they benefit from a rising interest rate environment, because their “assets,” mainly loans,…
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