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STATEMENT OF TATEMENT OF TATEMENT OF TATEMENT OF OBJECTIVES BJECTIVES BJECTIVES BJECTIVES To set out the Cayman Islands Monetary Authority (\u201cAuthority\u2019s\u201d) rule on Interest Rate Risk for banks, (each of the sub-paragraphs of section 4 below referred to as a \u201cRule,\u201d and collectively, the \u201cRules\u201d), pursuant to the Monetary Authority Law (2004 Revision) (\u201cMAL\u201d).\", \"element\": \"section\", \"heading\": null}, {\"eId\": \"sec_2\", \"num\": \"2.\", \"text\": \"2. 2. 2. INTRODUCTION NTRODUCTION NTRODUCTION NTRODUCTION 2.1. Section 34 of the MAL provides that the Authority may issue rules: 34. 34. 34. 34.  (1) 1) 1) 1) After private sector consultation and with the approval of the Governor, the Authority may \u2013 (a)  issue or amend rules or statements of principle or guidance concerning the conduct of licensees and their officers and employees; [and] \u2026 2.2. This document establishes the Rule on Interest Rate Risk and must be read in conjunction with the Statement of Guidance on Interest Rate Risk Management. *   Formerly referred to as Rule 4(B) November 2006 Page 2 of 2\", \"element\": \"section\", \"heading\": null}, {\"eId\": \"sec_3\", \"num\": \"3.\", \"text\": \"3. 3. 3. SCOPE OF COPE OF COPE OF COPE OF APPLICATION PPLICATION PPLICATION PPLICATION This rule applies to all banks regulated by the Authority under the Banks and Trust Companies Law (2003 Revision).\", \"element\": \"section\", \"heading\": null}, {\"eId\": \"sec_4\", \"num\": \"4.\", \"text\": \"4. 4. 4. RULES ULES ULES ULES 4.1. A bank must establish, implement, and maintain strategies, policies, and procedures for interest rate risk management appropriate for the size, complexity, and nature of its activities that set operating limits for interest rate exposures. 4.2. 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(1)\n1)\n1)\n1) After private sector consultation and with the approval of\nthe Governor, the Authority may \u2013\n\n(a)  issue or amend rules or statements of principle or\nguidance concerning the conduct of licensees and their\nofficers and employees; [and]\n\u2026\n\n2.2. This document establishes the Rule on Interest Rate Risk and\nmust be read in conjunction with the Statement of Guidance on\nInterest Rate Risk Management.\n\n*   Formerly referred to as Rule 4(B)\n\nNovember 2006\n\nPage 2 of 2\n\n3.\n3.\n3.\n3.\nSCOPE OF\nCOPE OF\nCOPE OF\nCOPE OF APPLICATION\nPPLICATION\nPPLICATION\nPPLICATION\n\nThis rule applies to all banks regulated by the Authority under the Banks\nand Trust Companies Law (2003 Revision).\n\n4.\n4.\n4.\n4.\nRULES\nULES\nULES\nULES\n\n4.1. A bank must establish, implement, and maintain strategies,\npolicies, and procedures for interest rate risk management\nappropriate for the size, complexity, and nature of its activities\nthat set operating limits for interest rate exposures.\n\n4.2. Such strategies, policies, and procedures must be approved by\nthe bank\u2019s board of directors.\n\n4.3. 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