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Which of the following statement is FALSE? Select one: a. Use of RAROC model helps a bank to decide whether a proposed loan will increase
Which of the following statement is FALSE? Select one: a. Use of RAROC model helps a bank to decide whether a proposed loan will increase the value of the bank's equity b. Qualitative credit risk model relies on the FI manager's subjective assessment of relevant factors in making a credit decision c. Logit models can be used to predict the probability of default of a borrower d. Linear discriminant model helps a bank to classify borrowers into appropriate default classes based on factors derived from historica data e. Term structure of interest rates is a key input to the RAROC model
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