MANAGEMENT

Detailed explanation-1: -The risk of value depreciation of bonds and other fixed-income investments is known as interest rate risk. Primarily due to depreciation in their interest rates, this happens because of market fluctuations.

Detailed explanation-2: -What Is Interest Rate Risk? Interest rate risk is the potential for investment losses that can be triggered by a move upward in the prevailing rates for new debt instruments. If interest rates rise, for instance, the value of a bond or other fixed-income investment in the secondary market will decline.

Detailed explanation-3: -Interest rate risk is the risk that arises when the absolute level of interest rates fluctuates. Interest rate risk directly affects the values of fixed-income securities.

Detailed explanation-4: -Definition of IRRBB Interest rate risk in the banking book (IRRBB) refers to the current or prospective risk to the bank’s capital and earnings arising from adverse movements in interest rates that affect the bank’s banking book positions.