Select all that are true regarding liquidity risk for a bank. O Consumer trust in the bank ensures a flow of funds from customers, reducing this risk. O A reduced access to credit markets reduces the bank's liquidity risk. O Higher liquidity risk is a result of lower borrowing costs to the bank. O The flow of funds form the bank's clearing of payments reduces this risk. O This risk creates an opportunity cost which could result in a hole in the risk management strategy of the bank. O An increase in the bank's credit rating will help to reduce their liquidity risk.
Select all that are true regarding liquidity risk for a bank. O Consumer trust in the bank ensures a flow of funds from customers, reducing this risk. O A reduced access to credit markets reduces the bank's liquidity risk. O Higher liquidity risk is a result of lower borrowing costs to the bank. O The flow of funds form the bank's clearing of payments reduces this risk. O This risk creates an opportunity cost which could result in a hole in the risk management strategy of the bank. O An increase in the bank's credit rating will help to reduce their liquidity risk.
Auditing: A Risk Based-Approach (MindTap Course List)
11th Edition
ISBN:9781337619455
Author:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg
Publisher:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg
Chapter10: Auditing Cash, Marketable Securities, And Complex Financial Instruments
Section: Chapter Questions
Problem 40CYBK
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![Select all that are true regarding liquidity risk for a bank.
Consumer trust in the bank ensures a flow of funds from customers, reducing this risk.
O A reduced access to credit markets reduces the bank's liquidity risk.
Higher liquidity risk is a result of lower borrowing costs to the bank.
O The flow of funds form the bank's clearing of payments reduces this risk.
| This risk creates an opportunity cost which could result in a hole in the risk management strategy of the bank.
O An increase in the bank's credit rating will help to reduce their liquidity risk.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Ffbb56cf1-6a26-4aeb-a45d-b4cff7c4b7e4%2Faae3e301-f436-4e49-9142-3eae5bde2a62%2F7w0ajyn_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Select all that are true regarding liquidity risk for a bank.
Consumer trust in the bank ensures a flow of funds from customers, reducing this risk.
O A reduced access to credit markets reduces the bank's liquidity risk.
Higher liquidity risk is a result of lower borrowing costs to the bank.
O The flow of funds form the bank's clearing of payments reduces this risk.
| This risk creates an opportunity cost which could result in a hole in the risk management strategy of the bank.
O An increase in the bank's credit rating will help to reduce their liquidity risk.
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