11 unchanged sentences
These policies are implemented by our Asset and Liability Management Committee (ALCO).
−Removed: The ALCO is comprised of members of the Bank’s senior management and a member from the Board of Directors.
+Added: The ALCO is comprised of members of the Bank’s senior management and Board of Directors.
The ALCO establishes guidelines for and monitors the volume and mix of our assets and funding sources, taking into account relative costs and spreads, interest rate sensitivity and liquidity needs.
3 unchanged sentences
The Committee is responsible for reviewing and reporting on the effects of the policy implementations and strategies to the Bank’s Board of Directors on a regularly scheduled basis.
−Removed: In order to manage our assets and liabilities and achieve desired levels of liquidity, credit quality, cash flow, interest rate risk, profitability and capital targets, we have focused our strategies on:
+Added: In managing our assets and liabilities to achieve desired levels of interest rate risk, we have focused our strategies on:
• originating shorter-term secured commercial, agricultural and consumer loan maturities;
1 unchanged sentence
• the sale of a vast majority of longer-term fixed-rate residential loans in the secondary market with retained servicing;
−Removed: • managing our funding needs by growing core deposits;
−Removed: • utilizing brokered certificate of deposits and borrowings as appropriate, which may have fixed rates with varying maturities;
+Added: • managing our funding needs growing core deposits;
+Added: • utilize brokered certificate of deposits and borrowings as appropriate, which may have fixed rates with varying maturities;
• purchasing investment securities to modify our interest rate risk profile.
At times, depending on the level of general interest rates, the relationship between long- and short-term interest rates, market conditions and competitive factors, the ALCO may determine to increase the Bank’s interest rate risk position somewhat in order to maintain or improve its net interest margin.
−Removed: The following table sets forth, at December 31, 2022 and December 31, 2021, an analysis of our interest rate risk as measured by the estimated changes in Economic Value of Equity (EVE) resulting from an immediate and permanent shift in the yield curve with the results of the scenarios shown in the table below.
−Removed: As of December 31, 2021, due to the level of interest rates, EVE estimates for decreases in interest rates greater than 100 basis points were not meaningful.
−Removed: The reduction in risk in the up-interest rate shocks from December 31, 2021 in the percentage of change in economic value of equity is largely due to the increased value of non-maturity deposits.
+Added: The following table sets forth, at December 31, 2023 and December 31, 2022 an analysis of our interest rate risk as measured by the estimated changes in Economic Value of Equity (“EVE”) resulting from an immediate and permanent shift in the yield curve (up 300 basis points and down 200 basis points).
Percent Change in Economic Value of Equity (EVE)
5 unchanged sentences
-100 bp 0% (1)%
−Removed: -200 bp (4)% N/M
+Added: -200 bp (2)% (4)%
(1) Assumes an immediate and parallel shift in the yield curve at all maturities.
−Removed: Our overall interest rate sensitivity is demonstrated by net interest income shock analysis which measures the change in net interest income in the event of an immediate and permanent shift in the yield curve.
−Removed: This analysis assesses the risk of change in our net interest income over the next 12 months in the event of an immediate and parallel shift in the yield curve and the results of the scenarios are shown in the table below.
−Removed: As of December 31, 2021, due to the level of interest rates, projected changes in net interest income for rate shock level decreases greater than 100 basis points were not meaningful.
−Removed: The decrease in the reduction of the percent change in net interest income rate shocks in the up-interest scenarios is largely due to the impact of the actual results and changes in the balance sheet compared to a flat balance sheet used in the simulation.
+Added: Our overall interest rate sensitivity is demonstrated by net interest income shock analysis, which measures the change in net interest income in the event of hypothetical changes in interest rates.
+Added: This analysis assesses the risk of change in our net interest income over the next 12 months in the event of an immediate and parallel shift in the yield curve (up 300 basis points and down 200 basis points).
+Added: The table below presents our projected change in net interest income for the various rate shock levels at December 31, 2023, and December 31, 2022.
Percent Change in Net Interest Income Over One Year Horizon
5 unchanged sentences
-100 bp 4% 1%
−Removed: -200 bp 2% N/M
+Added: -200 bp 7% 2%
(1) Assumes an immediate and parallel shift in the yield curve at all maturities.
The table above may not be indicative of future results.
+Added: The projected changes in net interest income in the rate shock scenarios is largely due to the impact of growth in short-term certificates of deposits, which reprice faster and at a higher rate than other deposit products.
The assumptions used to measure and assess interest rate risk include interest rates, loan prepayment rates, deposit decay (runoff) rates, and the market values of certain assets under differing interest rate scenarios.
2 unchanged sentences
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.