Mr. Leong has approached Star Bank Berhad to finance a house which was bought for RM500,000. The house was located at the posh area in Alor Setar. The bank credit officer analyzed Mr. Leongs income of his night market (pasar malam) business from his bank statements and it was found to have inconsistent cash flow besides cheque return due to insufficient funds. However, the credit officer still proceeds to recommend the loan based on the value of the house as security. The credit officer has failed to consider the following credit risk principle

A.Principle of control

B.Principle of risk diversification

C.Principle of pari-passu

D.Principle of risk taking in credit and lending