Assume that you are the CEO of CIBC. -The bank has a large portfolio of Canadian mortgages
Question:
Assume that you are the CEO of CIBC.
-The bank has a large portfolio of Canadian mortgages
-The economy is changing dramatically and there is a big expectation that both the interest rates and inflation will increase, which may result in a large default percentage for the mortgages that the bank carries
A. Identify the different measures that the bank should take to mitigate the risk of the events that can ensue from this increase in inflation and interest rates
B. Create a risk matrix that shows how different possible events (at least four) can be categorized
C. Provide specific numeric examples based on the company financial statements
Financial Management Theory and Practice
ISBN: 978-0176517304
2nd Canadian edition
Authors: Eugene Brigham, Michael Ehrhardt, Jerome Gessaroli, Richard Nason