Question
Bank XYZ wishes to raise its liabilities by $30m to cover its long-term lending for the next quarter. It can raise the funds via the
Bank XYZ wishes to raise its liabilities by $30m to cover its long-term lending for the next quarter. It can raise the funds via the issuance of either 90-day certificates of deposit or 5-year bonds. Discuss how the bank's choice of liability can:
(a)directly affect its liquidity risk;
(b)indirectly affect its credit risk
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Contemporary Financial Management
Authors: R. Charles Moyer, James R. McGuigan, Ramesh P. Rao
14th edition
1337090581, 978-1337090582
