The Bank Has a Positive Repricing Gap

Multiple Choice

The bank has a positive repricing gap.Is it exposed to interest rate increases or decreases and why?

A) Interest rate increases because the interest income on its assets will rise more than the interest expenses on its liabilities and net interest income will rise.
B) Interest rate increases because the interest income on its assets will fall more than the interest expenses on its liabilities and net interest income will fall.
C) Interest rate decreases because the interest income on its assets will rise more than the interest expenses on its liabilities and net interest income will rise.
D) Interest rate decreases because the interest income on its assets will fall more than the interest expenses on its liabilities and net interest income will fall.