As per liability management banking,the control lever to regulate the liabilities and assets on the balance sheet is
A)management discretion.
B)the volume of loan demand the bank faces.
C)deposit growth.
D)market interest rates.
E)None of the options is correct.

Question

Quizplus · Accepted Answer

Market interest rates are the control lever to regulate the liabilities and assets on the balance sheet in liability management banking. Banks must manage their liabilities and assets in response to fluctuations in market interest rates to maintain profitability and avoid risks such as interest rate risk. Other factors such as deposit growth and management discretion also play a role, but market interest rates are the primary control lever.

As Per Liability Management Banking,the Control Lever to Regulate the Liabilities