Capital Markets School

Internal Use Only

Evaluating IRR Simulation Models

One-off Simulation Runs •Can management run what-if simulations on strategic ideas?

Model Inputs

Scenarios • Magnitude,

Assumptions

Outputs • NII, EVE, NI

•Call Report, Chart of Accounts, or Hybrid

• Is

Pace (Shock vs. Ramps), Time Horizon, Yield Curve Shifts (Parallel vs. Non-parallel)

management able to input and change assumptions?

Internal Use Only

Model Outputs