Banking Practice Exam 2025 – 400 Free Practice Questions to Pass the Exam

The dollar amount considered rate sensitive in the 0 - 90 day bucket refers to the portion of the loan that is likely to be affected by changes in interest rates within that timeframe. For a $1,000,000 loan payable in four equal installments, each installment amounts to $250,000.

As the loan is structured into four installments, each installment can be viewed as a separate commitment of principal that is paid off over time. Since there are four equal payments, each payment will impact the overall sensitivity to interest rates during the initial periods. Given that the first installment is due in the immediate period (the 0 - 90 day bucket), it is considered rate sensitive because any changes in interest rates during this period will directly affect the financial implications of that payment.

Thus, with each installment equating to $250,000, the dollar amount that is considered rate sensitive in this time frame is specifically the first installment. As a result, the total amount susceptible to interest rate changes in those first 90 days totals $250,000.