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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 Assets ( millions) Liabilities and equity (millions)
Cash 40 Loans 130 Securities 80 Total assets 250
Deposits 150 Borrowed funds 40 Equity 60 Total liabilities and equity 250
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