Podcast
Questions and Answers
What is the purpose of liquidity management?
What is the purpose of liquidity management?
What does liquidity management refer to?
What does liquidity management refer to?
What causes deposit outflows in liquidity management?
What causes deposit outflows in liquidity management?
Study Notes
Liquidity Management
- Refers to the process of managing a bank's liquidity to ensure its ability to meet its short-term obligations and maintain financial stability
- Involves forecasting and managing cash inflows and outflows to maintain an adequate liquidity buffer
Deposit Outflows
- Occur when depositors withdraw their funds from the bank, reducing the bank's liquidity
- Can be caused by factors such as:
- Loss of depositor confidence
- Higher interest rates offered by competitors
- Economic downturns
- Regulatory changes
- Bank-specific issues (e.g. management problems, asset quality concerns)
Studying That Suits You
Use AI to generate personalized quizzes and flashcards to suit your learning preferences.
Description
Test your knowledge of liquidity management with this quiz. Explore the strategies and techniques used by organizations to meet short-term cash requirements and ensure timely access to liquid funds. Learn about deposit outflows and how organizations mitigate the risk of losses when depositors withdraw funds.
