... interest rate risk (by varying the proportion of fixed -rate versus variable -rate loans, using interest rate swaps). Investigating these strategies is beyond the scope of this paper. rate risk, the ... where rl, rd, mrs and mrl are the retail lending rate, retail deposit rate, the short-term and long-term market interest rate, while rl is alternatively the interest rate on loans to firms (short ... all retail bank interest rates in the period prior to Stage Three of EMU, following market interest rate developments. In addition to the upturn, which took place after April 1999, the other...