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The balance sheet (book values) of Hedge Row Bancorp (in millions) is provided below. a)...

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The balance sheet (book values) of Hedge Row Bancorp (in millions) is provided below. a) Calculate the cumulative one-year repricing gap (CGAP) for Hedge Row Bancorp. ( 6 marks) b) Based on the answer from a) explain which risk Hedge Row Bankcorp would be exposed to. (2 marks) c) Calculate the cumulative one-year impact on net interest income of Hedge Row Bancorp of a 11%% ( 125 basis points) increase in interest rates on both rate sensitive assets and rate sensitive liabilities. ( 4 marks) d) The weighted-average Duration of the assets of Hedge Row Bancorp is calculated at 3.6 years, while the weighted-average Duration of its liabilities is calculated at 2.8 years. The market values of the assets are estimated to be $1,000 (million), while the market value of the liabilities equate to the book value. With interest rate expected to rise from 9% to 10%, calculate the potential impact to the market value of the equity of Hedge Row Bancorp. (8 marks)

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