Question

When a Bank sanctions a loan to a large borrower, which of the following risks it may not face?

A Liquidity Risk Correct Answer Incorrect Answer
B Market Risk Correct Answer Incorrect Answer
C Credit Risk Correct Answer Incorrect Answer
D Operational Risk Correct Answer Incorrect Answer
E None of the above Correct Answer Incorrect Answer

Solution

Market risk is associated with change in the market value of assets or liabilities. The loan extended is not a marketable security being affected by market prices.

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