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A Singaporean bank makes a one-year loan to an Australian corporate borrower at 6 percent annual interest. The loan is funded by issuing 5-year bonds

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A Singaporean bank makes a one-year loan to an Australian corporate borrower at 6 percent annual interest. The loan is funded by issuing 5-year bonds in the US at 4 percent annual coupon rate. Currently, spot exchange rates are 1.02 Singaporean Dollar per AUD and 0.74 US dollar per Singaporean dollar. The bank is exposed to: O interest rate , foreign exchange risk and liquidity risk. foreign exchange risk only. credit risk only. interest rate risk, foreign exchange risk and credit risk. O interest rate risk only

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