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Question
Which of the following would be an example of liquidity risk?
A. A bank teller manages to steal $250,000 over a period of several months.
B. An out-of-date computer system causes the bank to lose $750,000.
C. A bank is forced to sell $1,000,000 in loans, at a loss, in order to meet the needs of depositors.
D. A $500,000 that loan the bank has made has been deemed uncollectible.
E. None of the examples are of liquidity risk.
Answer
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Related questions
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Which of the following adjustments are made to gross loans and leases to obtain net loans and leases?
A. Loan and lease loss allowance is added to gross loans.
B. Unearned income is subtracted from gross interest received.
C. Investment income is added to gross interest received.
D. Loan and lease loss allowance and unearned income is subtracted from gross loans.
E. Loan and lease loss allowance is subtracted from gross loans and investment income is added to gross interest received.
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B. It should fall by 0.6 percent.
C. It should fall by 4 percent.
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Which of the following would be an example of a repriceable asset?
A. Money the bank has borrowed from the money market
B. Cash in the vault
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A. deposits and non-deposit borrowings are not affected by changes in interest rates.
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C. accounting irregularities when reporting earnings of the combined entity.
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