Economics
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Liquidity Risk
Banks tend to attract short term deposits and they often lend for longer periods of time. As a result, a commercial bank may not be able to repay all of those deposits if savers decide to withdraw their funds. This is called liquidity risk. To reduce liquidity risk banks will try to attract longer term deposits and also hold some liquid assets as capital reserves.
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Financial Markets - Concentration Knowledge Retrieval Quiz
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Economics of Commercial Banks
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What is Systemic Risk?
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