Banking Ethics - Changing Dynamics
Chapter notes, video classes, MCQ practice tests and quick-revision one-liners for Ethics in Banking — Ethics in Banking.
One-liners from this chapter
Free sample — 8 of 66 rapid-fire Q&A cards.
What is front-running in the context of a bank's trading desk?
Front-running is placing the bank's own trades ahead of large client orders to profit from the anticipated price movement, exploiting confidential client information.
What are the classical pillars of banking ethics that remain unchanged despite technological changes?
Integrity, confidentiality, and prudence are the unchanged pillars.
Why is front-running considered a breach of fiduciary duty?
Front-running exploits confidential client order information for personal gain, constituting a breach of fiduciary duty and violating the trust clients place in their bank.
What does the 'changing dynamics' in banking ethics refer to according to IIBF?
The changing operating context — technology, stakeholder mix and regulatory expectations.
How is front-running best described from an ethics perspective?
Front-running is best described as a serious conflict of interest and breach of fiduciary duty that exploits confidential client information for personal gain.
Under which FREE-AI Sutra does a rejected loan applicant's right to explanation and human review fall?
Sutra 5 — Protection (explainability, fairness, human-in-the-loop).
Is front-running considered a routine or acceptable trading strategy in banking ethics?
No, front-running is not a routine trading strategy — it is an ethical and legal violation regardless of whether it is common or profitable.
What is algorithmic disparate impact in the context of bank AI loan models?
When an AI model disproportionately rejects minority groups due to biased features like postal code.
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