15 unchanged sentences
The results show a theoretical change in the economic value of shareholders’ equity as interest rates change.
+Added: The NII simulation provides a short-term view of interest rate risk over a 12-month and 24-month time horizon.
+Added: NII simulations are prepared by calculating net interest income in a scenario where interest rates do not change (base case) and then recalculated in scenarios with higher and lower interest rates.
+Added: The results of each variation are compared against the base case scenario to determine the potential change in earnings.
EVE and NII simulations are completed routinely and presented to the Asset/Liability Committee.
24 unchanged sentences
Rates are increased instantaneously at the beginning of the projection.
−Removed: Under this instantaneous parallel interest rate shock, static balance sheet NII simulation, the Company is modestly asset sensitive in the initial year, as the Company’s large variable rate loan portfolio reprices the full amount of the assumed change in interest rates, while the large retail savings and short-term retail certificates of deposits portfolio will reprice with an assumed beta.
−Removed: Annually, the Company’s retail certificate of deposits portfolio has a significant maturity event in the first half of the year.
−Removed: The Company is also modestly asset sensitive in the second year of the projection due to interest rates increasing or decreasing for the full year, the Company’s loan portfolio continuing to reprice, and also due to the other assumptions used in the analysis as noted previously.
+Added: Under this instantaneous parallel interest rate shock, with a static balance sheet NII simulation, the Company is slightly asset sensitive in the initial year, as the Company’s large variable rate loan portfolio reprices the full amount of the assumed change in interest rates, while the large retail savings and short-term retail certificates of deposits portfolio will reprice with an assumed beta.
+Added: The Company’s retail certificate of deposits portfolio has a larger maturity event in the first and last quarters of the year.
+Added: The Company is slightly liability sensitive in the second year of the projection due to interest rates increasing or decreasing for the full year, the Company’s loan portfolio continuing to reprice, and also due to the other assumptions used in the analysis as noted previously.
Interest rates do not normally move all at once or evenly over time, but management believes that the analysis is useful to understanding the potential direction and magnitude of net interest income changes due to changing interest rates.
2 unchanged sentences
This is largely driven by the Company’s longer asset duration, primarily consisting of investments and loans, versus the shorter duration of its funding portfolio, primarily consisting of retail savings and short-term retail certificates of deposits.
−Removed: Increased fixed rate loan production since 2020 versus prior years, given the historical low market rate environment, has also been a significant driver in the model results.
The NII and EVE simulation analysis shown above is only an estimate of interest rate risk exposure at a particular point in time without growth considerations.
3 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.