In Relation to a Bank,liquidity Management Means

question 65

Multiple Choice

In relation to a bank,liquidity management means:

• A) the bank's ability to quickly convert deposits into loans.
• B) the bank's ability to onsell its loans.
• C) the bank's ability to have funds available when depositors' funds mature.
• D) the bank's policies and practices in identifying and managing its loans portfolios.

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Definitions:

Posting

The process of recording financial transactions in the appropriate accounts in the ledger of a business.

Prepaid Insurance

An asset account representing the advance payment for insurance coverage, which will be expensed over the period of coverage.

Insurance Premiums

Payments made to an insurance company in exchange for coverage, which can be paid monthly, quarterly, or annually.

Insurance Expense

The cost reported by a company for premiums it pays on its insurance policies, covering risks such as property damage, theft, or liability.