Answer Happy

36 Consider the following balance sheet for Watchover Savings Incorporated in millions): Assets Liabilities and Equity Floating-rate mortgages (currently 11% per annum) $ 98 Now deposits (currently 7+ per annum) $ 124 30-year fixed-rate loans (currently 87 per annum 109 5-year time deposits currently 78 per annun) Equity Total $ 207 Total $ 207 a. What is Watchover's expected net interest income at year-end? (Enter your answer in millions rounded to 2 decimal places. (c.9., 32.16)) b. What will be the net interest income at year-end if interest rates rise by 2 percent? (Enter your answer in millions rounded to 2 decimal places. (e.g.. 32.16) c. Using the one-year cumulative repricing gap model, what is the change in the expected net interest income for a 2 percent increase in interest rates? (Negative amount should be indicated by a minus sign. Enter your answer in millions rounded to 2 decimal places. (e.9., 32.16) a Net interest income b Net interest income C Change in net interest income milion milion milioni