Question

The principal goal of interest-rate hedging strategy is to hold fixed a bank's:_______.

A. Net interest margin
B. Net income before taxes
C. Value of loans and securities
D. Noninterest spread
E. None of the above.

Answer 1

A. Net interest margin

Step-by-step explanation:

In Financial accounting, net interest margin can be defined as a means of measuring or estimating the difference between the amount of interest realized by a financial institution or other depository institutions and the amount of interest that is being paid to lenders in relation to their assets portfolio.

The principal goal of interest-rate hedging strategy is to hold fixed a bank's net interest margin.