Off-balance sheet activities can have both positive and negative effects on the risk of the FI.

Name: Off-balance sheet activities can have both positive and negative effects on the risk of the FI.
Brand: Quizplus
Rating: 4.7 (45 reviews)

Question

Quizplus · Accepted Answer

Off-balance sheet activities can diversify an FI's revenue stream and potentially reduce risk, but they can also expose the FI to new risks and potentially increase overall risk. Therefore, the effect of off-balance sheet activities on an FI's risk profile can vary.

Off-Balance Sheet Activities Can Have Both Positive and Negative Effects