Interest Rate Risk,
stable for the short-term, elevated for
the long-term
Along with shrinking margins and major declines in credit quality, the
banking industry has one more worry to contend with: Long-term Interest Rate
Risk is rising. The last time this occurred was more than two years ago,
when banks showed a 3% annual increase in their EVE at Risk during the first
three quarters of 1999. Now, at the end of 2001, banks are showing a similar
trend. ....[more]
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