Characterize each of the following according to the type of risk it primarily represents:
I. loan default
II. unexpected deposit withdrawals
III. losses on foreign currency holdings
IV. losses on standby letters of credit
V. reduction in earnings after an interest rate increase
Indicate which of the risks could cause insolvency of the FI.

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The Answer of Characterize each of the following according to the type of risk it primarily represents:
I. loan default
II. unexpected deposit withdrawals
III. losses on foreign currency holdings
IV. losses on standby letters of credit
V. reduction in earnings after an interest rate increase
Indicate which of the risks could cause insolvency of the FI.

Characterize Each of the Following According to the Type of Risk