If the economy slows down,a bank should review its outstanding loans more frequently.

Question

Quizplus · Accepted Answer

When the economy slows down, borrowers may face difficulties in repaying their loans, leading to higher rates of default. Thus, banks should review their outstanding loans more frequently to assess the creditworthiness of the borrowers and to minimize their exposure to risk. This practice may involve monitoring the financial performance of the borrower and/or requiring additional collateral or credit enhancements.

If the Economy Slows Down,a Bank Should Review Its Outstanding