You are the bank's liquidity manager. What should you do if the yield on non-liquid assets increases
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Question:
You are the bank's liquidity manager. What should you do if the yield on non-liquid assets increases and why? Answer this question by filling in the blanks. Please use the suitable word provided in the round brackets.
The risk of illiquidity(increased/decreased/did not change). The cost of illiquidity(increased/decreased/did not change). Therefore it makes sense to(increase/decrease/ maintain) the ESF buffer. As a result your bank will provide(more/less/the same) liquidity transformation for society.
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