BNK701: Banking Risk Management

Bank of Baroda (BOB) was established on 20th July 1908 in the princely state of Baroda by the great visionary, Sir Sayajirao Gaekwad III. The founder strongly believed that, a bank of this nature would prove to be a beneficial agency for lending , transmission and deposit of money and a powerful factor in the development of art, industries and commerce of the state as also of adjoining territories. Bank of Baroda has 100 years of glorious performance and an uninterrupted profit record, serving generation after generation around the globe.Our International Operations have a considerable history with our first overseas branch in Mombasa, Kenya established in 1953. Today, on a consolidated basis, we have an international presence in 24 countries with 71 branches and offices which gives us diversity of business and a wide customer reach. We offer a variety of banking services through our international network, which varies from country to country.

Answer the following questions below:

Introduction

Briefly explain a background of Bank of Baroda and discuss the liquidity status of the Bank of Baroda before and after the COVID19 pandemic.

Analysis and Results

a. What is the Bank of Baroda total available (sources of) liquidity?

b. What is Bank of Baroda current total uses of liquidity?

c. What is Bank of Baroda net liquidity ?

d. Calculate the financing gap of Bank of Baroda?

e. What is the financing requirement of Bank of Baroda?

f. The Bank of Baroda expects a net deposit drain of $20 million. Show the banks balance sheet if the following conditions occur: i. The Bank of Baroda purchases liabilities to offset this expected drain.

ii. The stored liquidity management method is used to meet the expected drain (the Bank of Baroda does not want the cash balance to fall below $5 million, and securities can be sold at their fair value)

Give conclusion

Bank: Bank of Baroda Summary key Disclosure statement For the financial year ended Balance sheet cash ond liquid assets Balance with the Reserve lank of fuir Income statement Bank: Bank of Baroda Summary key Disclosure statement For the financial year ended Balance sheet cash ond liquid assets Balance with the Reserve lank of fuir Income statement