You are a bank examiner and have concerns that the bank you are examining may have a

Question:

You are a bank examiner and have concerns that the bank you are examining may have a problem. On examining the bank’s assets, you notice that the loan sizes of a significant portion of a bank’s loans are increasing in relatively small increments each month. What do you think might be going on and what should you do about it?

Solvency
Solvency means the ability of a business to fulfill its non-current financial liabilities. Often you have heard that the company X went insolvent, this means that the company X is no longer able to settle its noncurrent financial...