Bank Analysis School - Case Study & Resources

IRR - FUNDING MATURITY INFO

Sunny State Bank

Long-Term Funding (Repricing/Maturing > 3 Years) / Total Assets

5.0%

4.5%

4.2%

4.0%

3.5%

Metrics

3.1%

3.0%

Bank

2.8%

3.0%

State

2.4%

2.5%

All Banks

2.0%

2.0%

1.5%

1.5%

20 X9 Q4

20 X0 Q4

20 X1 Q4

20 X2 Q4

20 X3Q4

20 X4 Q4

20 X5 Q4

Non-Maturity Deposits / Total Assets

72.0%

68.4%

68.0%

65.9%

65.6%

64.0%

62.1%

59.1%

60.0%

56.0%

52.0%

49.1%

48.1%

20 X9Q4

20 X0 Q4

20 X1 Q4

20 X2 Q4

20 X3 Q4

20 X4Q4

20 X5 Q4

Repricing risk is the most common form of IRR, and is caused by a mismatch in the term structure of assets and liabilities. If a bank's asset structure is long-term, risk to rising rates can be partly mitigated by a longer-term funding structure (which could include a high amount of stable non-maturity deposits).