Ask Question
BusinessBusiness
12 December, 10:39

Off-balance sheet activities involving guarantees of securities and back-up

a) credit lines have no impact on the risk a bank faces.

b) increase the risk a bank faces.

c) greatly reduce the risk a bank faces.

d) slightly reduce the risk a bank faces.

+5
Answers (1)
  1. 12 December, 11:13
    0
    B) increase the risk a bank faces.

    Explanation:

    Off-balance sheet activities include all the bank's activities regarding assets, debts or other financing activities that are not presented in the bank's balance sheet, e. g. issuance of guarantees, commitments to make loans, etc.

    Banks incur in this type of activities because generally they charge fees for them (increase revenue) without affecting measures of indebtedness like debt to equity ratio.
Know the Answer?
Not Sure About the Answer?
Find an answer to your question ✅ “Off-balance sheet activities involving guarantees of securities and back-up a) credit lines have no impact on the risk a bank faces. b) ...” in 📘 Business if you're in doubt about the correctness of the answers or there's no answer, then try to use the smart search and find answers to the similar questions.
Search for Other Answers
You Might be Interested in
Why might it be easier to begin a career as an accessory designer than a fashion designer?
Answers (1)
Slimline and Distributor signed a contract providing that Distributor would use reasonable efforts to promote and sell Slimline's diet drink. Slimline was already being sold in Warehouse Club.
Answers (1)
Shawn is on the executive board for ABC pharmaceuticals. The company produces the number one selling cancer-fighting drug on the market.
Answers (1)
suppose the quarterly (90-day) interest rate in the us is 2.5% and it is 4% in canada. if the $/cd spot exchange rate is $0.80/cd and the 90-day forward exchange rate between us and canadian dollars is $0.
Answers (1)
Were there more exports or imports?
Answers (2)
New Questions in Business
Peterson Company estimates that overhead costs for the next year will be $3,400,000 for indirect labor and $850,000 for factory utilities. The company uses machine hours as its overhead allocation base.
Answers (1)
If you are in sydney, australia, and plan to attend a web conference being held at 10:00am us pacific daylight time (pdt) on 29 may 2012, at what local time do you need to log in?
Answers (1)
Lake Charles Seafood makes 550 wooden packing boxes for fresh seafood per day, working in two 10-hour shifts. Due to increased demand, plant managers have decided to operate three 8-hour shifts per day instead.
Answers (1)
In 2017, in a speech in China, Apple CEO Tim Cook stated that globalization is "great for the world ... I think the reality is you can see that countries in the world ... that isolate themselves, it's not good for their people.
Answers (1)
A demand curve that is horizontal indicates that the commodity
Answers (1)
Home » Business » Off-balance sheet activities involving guarantees of securities and back-up a) credit lines have no impact on the risk a bank faces. b) increase the risk a bank faces. c) greatly reduce the risk a bank faces. d) slightly reduce the risk a bank faces.
Sign Up Forgot Password?