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Questions and Answers
Which of the following is a key aspect of credit risk management in commercial banks?
Which of the following is a key aspect of credit risk management in commercial banks?
- Providing loans to high-risk borrowers
- Minimizing the exposure to potential losses from default (correct)
- Maximizing profits through risky lending practices
- Ignoring potential credit risks
What is the purpose of conducting credit risk assessments in commercial banks?
What is the purpose of conducting credit risk assessments in commercial banks?
- To increase the profitability of the bank
- To identify potential defaulters (correct)
- To ignore potential credit risks
- To attract high-risk borrowers
Why is credit risk management important for commercial banks?
Why is credit risk management important for commercial banks?
- To ignore potential credit risks
- To avoid providing loans to high-risk borrowers
- To minimize potential losses from default (correct)
- To maximize profits through risky lending practices
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