Bank Management

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Assignment 2

Course Name: Bank ManagementStudent’s Name:
Course Code: FIN401Student’s ID Number:
Trimester: CRN:
Academic Year:

For Instructor’s Use only

Instructor’s Name:
Students’ Grade:   /15Level of Marks: High/Middle/Low

Instructions – PLEASE READ THEM CAREFULLY

  • This assignment is an individual assignment.
  • The due date for Assignment 2 is 27/05/2023
  • The Assignment must be submitted only in WORD format via the allocated folder.
  • Assignments submitted through email will not be accepted.
  • Students are advised to make their work clear and well-presented, marks may be reduced for poor presentation. This includes filling in your information on the cover page.
  • Students must mention the question number clearly in their answers.
  • Late submissions will NOT be accepted.
  • Avoid plagiarism, the work should be in your own words, copying from students or other resources without proper referencing will result in ZERO marks. No exceptions.
  • All answers must be typed using Times New Roman (size 12, double-spaced) font. No pictures containing text will be accepted and will be considered plagiarism).

Submissions without this cover page will NOT be accepted.

Assignment Questions                                                                                [15 Marks]

    • Which act/s in the US Banking Sector supports the lifeline banking service?          [1Mark]
    • Explain the different services that are covered under Lifeline Banking for low-income people.                                                                                                                                          [2 Marks]
    • What are the different non-deposit sources of funds for banks?                                [1Mark]
    • Explain the risks for the banks especially associated with non-deposit sources of funds.                                                                                                                                                    [2 Marks]
    • What is the difference between real and nominal interest rates?                               [1Mark]
    • Explain the concept of Interest Rate Determination in the light of the Loanable Fund Theory.                                                                                                                                           [2 Marks]
    • What are financial derivatives?                                                                                  [1Mark]
    • Explain the process of a financial Put Option with the help of an example.              [2 Marks]
    • What is the difference between an Asset sensitive and a Liability sensitive firm?    [1Mark]
    • If interest-sensitive assets (ISA) and interest-sensitive liabilities (ISL) of a financial firm are $125 million & $100 million respectively, what will be its interest-sensitive GAP (IS GAP)? Calculate the Relative IS GAP ratio for the same financial institution and comment, Is that firm Asset sensitive?                                                                                                             [2 Marks]