Your lecture 3 material focuses primarily on the subject of risk.  At it base level, risk is the chance that an event will or will not happen.  One of the greatest risk a bank faces is credit risk, the chance a borrower will not repay their debt.

What would be the impact on your bank if management decided to stop lending money for Consumer Loans (Cars, Boats,  Home-Improvement, Home Equity) so as to eliminate it's risk?

Answer rating: 100% (QA)

A banks exposure to credit risk would be reduced if it stopped lending money for consumer loans ... View the full answer