[Chapter 5] ALM 201 - Part I - Exploring Income Simulation (03-11-14)
Apr 03, 2014•2 min
Episode description
Chapter 5: The Metrics for Estimating IRR + Methodologies to Estimate IRR
Income simulation is the most common method of estimating interest rate risk in the credit union's balance sheet. It is simple in concept, but complex in its application. In this presentation, we will explain how income simulation works. The most common variables and assumptions, such a prepayment speeds and deposit rate sensitivity, will also be covered.
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