In terms of liquidity risk measurement, the financing gap is defined as
A)total deposits minus core deposits.
B)financing requirement plus liquid assets.
C)rate sensitive assets minus rate sensitive liabilities.
D)total assets minus total liabilities.
E)average loans minus average deposits.

Question

Quizplus · Accepted Answer

The financing gap is calculated as the difference between average loans and average deposits, indicating the amount of funding a bank needs to secure from other sources.

In Terms of Liquidity Risk Measurement, the Financing Gap Is