Question
What is the impact on the balance sheet below for a Bank if its largest customer decides to exercise a 100 million loan commitment if
What is the impact on the balance sheet below for a Bank if its largest customer decides to exercise a 100 million loan commitment if the bank uses:
(i) asset (stored) liquidity management
(ii) liability (purchased) liquidity management Balance Sheet
Balance Sheet
Assets ( millions)
Liabilities and equity (millions)
Cash
40
Deposits
150
Loans
130
Borrowed funds
40
Securities
80
Equity
60
Total assets
250
Total liabilities and equity
250
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Financial Institutions Management A Risk Management Approach
Authors: Anthony Saunders, Marcia Millon Cornett
9th edition
1259717771, 1259717772, 9781260048186, 1260048187, 978-1259717772
