EBC Financial Terms TIPS:Bank Stress Test

2023-05-12
Summary:

A bank stress test is an analysis conducted under hypothetical scenarios designed to determine whether a bank has enough capital to withstand a negative economic shock.

Bank Stress Test:

A bank stress test is an analysis conducted under hypothetical scenarios designed to determine whether a bank has enough capital to withstand a negative economic shock. These scenarios include unfavorable situations, such as a deep recession or a financial market crash.Bank stress tests were widely put in place after the 2008 financial crisis. Many banks and financial institutions were left severely undercapitalized.

Bank Stress Test

Classification and Functions of Financial Institutions

Classification and Functions of Financial Institutions

Financial institutions are various organizations engaged in financial activities: insurers, banks, and investment banks. earning profits through spreads, fees, and investment returns, providing fund circulation and risk management for the economy.

2024-03-01
Credit ratings: a key indicator of investment and market influence

Credit ratings: a key indicator of investment and market influence

Credit rating is the process of assessing the credit risk of bond issuers, borrowers, or financial products, impacting borrowing costs and market liquidity. It is crucial for investors to evaluate default risk.

2024-03-01
Opportunities and risks of mergers and acquisitions

Opportunities and risks of mergers and acquisitions

Mergers and acquisitions (M&A) is the behavior of merging or acquiring two companies to become one. offering expansion opportunities but posing integration and financial risks; high-yield potential for investors entails investment loss risk.

2024-03-01