Bank Analysis School Case Study eBook

Sunny State Bank

IRR - ASSET MATURITY INFO

Assets > 5 Years / Total Assets

Assets > 15 Years / Total Assets

80%

5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0% 45.0%

40.8% 39.7%

70%

39.4% 39.7% 39.5%

70%

69%

69% 70%

38.2%

67%

66% 66%

66% 67%

70%

64%

35.4%

35.2%

69%

33.7% 34.6%

68%

68%

58%

37.5%

66%

66%

31.9%

65% 64%

36.5%

60%

30.5%

61%

60%

32.8% 31.6%

32.8%

57%

50%

25.2%

24.9%

Metrics

40%

24.6% 25.2%

Bank State All Banks

30%

20%

10%

20X9Q2

20X9Q3

20X9Q4

20X0Q1

20X0Q2

20X0Q3

20X0Q4

20X1Q1

20X1Q2

20X1Q3

20X1Q4

20X2Q1

20X2Q2

20X2Q3

20X2Q4

20X3Q1

20X3Q2

20X3Q3

20X3Q4

20X4Q1

20X4Q2

20X4Q3

20X4Q4

20X5Q1

20X5Q2

20X5Q3

20X5Q4

20X9Q2

20X9Q3

20X9Q4

20X0Q1

20X0Q2

20X0Q3

20X0Q4

20X1Q1

20X1Q2

20X1Q3

20X1Q4

20X2Q1

20X2Q2

20X2Q3

20X2Q4

20X3Q1

20X3Q2

20X3Q3

20X3Q4

20X4Q1

20X4Q2

20X4Q3

20X4Q4

20X5Q1

20X5Q2

20X5Q3

20X5Q4

Assets > 5 Years / Total Assets (By Category)

Assets > 15 Years / Total Assets (By Category)

80%

45%

40%

70%

35%

60%

30%

50%

25%

Metrics

40%

20%

MBS Loans Bonds

30%

15%

20%

10%

10%

5%

20X1Q1 20 X1 Q2

20X9Q2

20X9Q3

20X9Q4

20X0Q1

20X0Q2

20X0Q3

20X0Q4

20X1Q1

20X1Q2

20X1Q3

20X1Q4

20X2Q1

20X2Q2

20X2Q3

20X2Q4

20X3Q1

20X3Q2

20X3Q3

20X3Q4

20X4Q1

20X4Q2

20X4Q3

20X4Q4

20X5Q1

20X5Q2

20X5Q3

20X5Q4

20X9Q2

20X9Q3

20X9Q4

20X0Q1

20X0Q2

20X0Q3

20X0Q4

20X1Q3

20X1Q4

20X2Q1

20X2Q2

20X2Q3

20X2Q4

20X3Q1

20X3Q2

20X3Q3

20X3Q4

20X4Q1

20X4Q2

20X4Q3

20X4Q4

20X5Q1

20X5Q2

20X5Q3

20X5Q4

• Holding a large amount of long-term assets often corresponds with risk to rising interest rates, because the yield on long-term assets could be stagnant for a long period while rising interest rates cause funding costs to increase. • Keep in mind that debt securities are typically non-amortizing and tend to have longer durations than amortizing loans and MBS; the implication being that a high amount of long term debt securities is more concerning than a high amount of long-term loans and mortgage-backed securities (MBS).