Over the past decades, off-balance sheet activities have become more popular in the global financial industry....

 

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Over the past decades, off-balance sheet activities have become more popular in the global financial industry. Give two examples of off-balance sheet activities that have led to the collapse of the related financial institution. Give one example of off- balance sheet activities that has increased the financial institution's return without much effect on her risk. (10 marks) Suppose a small business owner come to a bank to apply for a loan. What are the various types of practice that the bank will use to reduce the problem and consequence of adverse selection and moral hazard? Over the past decades, off-balance sheet activities have become more popular in the global financial industry. Give two examples of off-balance sheet activities that have led to the collapse of the related financial institution. Give one example of off- balance sheet activities that has increased the financial institution's return without much effect on her risk. (10 marks) Suppose a small business owner come to a bank to apply for a loan. What are the various types of practice that the bank will use to reduce the problem and consequence of adverse selection and moral hazard?

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Offbalance sheet activities have indeed played a significant role in the financial industry both in positive and negative aspects Here are examples as ... View the full answer