Capital is the cushion banks have against:

Name: Capital is the cushion banks have against:
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Question

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Capital serves as a safety net for banks against sudden drops in the value of their assets. In such situations, banks can use their capital to absorb losses, which helps to protect depositors and help ensure that banks continue to operate effectively. Capital also provides a cushion for banks against other types of risks, including credit risk, liquidity risk, and operational risk.

Capital Is the Cushion Banks Have Against