The common view of many regulators and practitioners is that the minimum risk maturity gap is equal to zero. However, because of the interest sensitivity of such non‐gap items as the average spread between asset and liability rates, lending activity, fee income and prepayments, the minimum...

The purpose of this paper is to empirically investigate the interaction between hedging, financing, and investment decisions. This work is relevant in that theoretical predictions are not necessarily identical to those in the case where only two decisions are being made. We argue that the way in...