RiskMgmt_MeasureRisk_Mgmt_in_banks_Questions.pdf

RiskMgmt_MeasureRisk_Mgmt_in_banks_Questions.pdf - 1 RISK...

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1 1 RISK MANAGEMENT IN BANKS Questions and answers David Veredas QUESTION 1 (15.10 of Hull): What is the difference between the trading book and the banking book for a bank? A bank currently has a loan of $10 million to a corporate client. At the end of the life of the loan, the client would like to sell debt securities to the bank instead of borrowing. How does this potentially affect the nature of the bank’s regulatory capital calculations? Q2 (15.12 of Hull): Banks sometimes use what is referred to as
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  • Spring '16
  • Finance, Basel II, Capital requirement, stable Funding Ratio, Liquidity coverage Ratio

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