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CAIIB BFME Module B & C By Ashish Sir Class 15
What is the primary objective of Risk Management in banks?
The primary objective of risk management in banks is to identify, measure, monitor, and control risks to protect the bank's capital and earnings while ensuring regulatory compliance and financial stability.
What is 'Market Risk' in the context of banking and trading activities?
Risk of loss due to adverse movements in market prices.
What are the three main categories of risk faced by banks under Basel framework?
The three main categories are Credit Risk (risk of borrower default), Market Risk (risk from market price movements), and Operational Risk (risk from failed internal processes, people, systems, or external events).
What is the 'Standardised Approach' for calculating Market Risk capital under Basel?
Uses fixed regulatory risk weights for different market risk categories.
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