Unmatched book


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Unmatched book

If the average maturity of a bank's liabilities is shorter than that of its assets, it is said to be running an unmatched book. The term is commonly used with the Euromarket. Also refers to entering into OTC derivatives contracts and not hedging by making trades in the opposite direction to another financial intermediary. In this case, the firm with an unmatched book usually hedges its net market risk with futures and options. Related expressions: Open book and short book.

Open Book

A situation in which a bank's liabilities have a shorter term (on average) than its assets. This indicates that it may not be able to meet its obligations when the time comes. It is also called an unmatched book or a short book.
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