A bank is able to reduce the default risk of a line of credit by which...

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A bank is able to reduce the default risk of a line of credit by which method? Da syndication b. clean up requirement cannual

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Answer 1

Answer #1

Question 24.

Option d, all of the above

Reason: Loan syndication is where the banker reduces risk by sharing the loan with other financers. The clean up requirement is wherein the borrower is required to maintain zero balance in LOC and an annual review of the credit status will help in evaluation of customers ability to repay the loan.

Question 25:

Option c, refinancing risk.

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Answer 2

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