In terms of liquidity risk measurement, the financing gap is defined as:

Question

BlackTom AI · Accepted Answer

Financing gap equals average loans minus average deposits because it measures the bank’s net funding shortfall: how much lending is not covered by deposit funding and therefore must be financed from other sources.

1) Relevant knowledge points and concepts
- Liquidity (financing) gap: a simple liquidity metric that shows the extent to which a bank’s lending (illiquid uses) exceeds its deposit funding (liquid sources). A positive gap means the bank must find extra funding; a negative gap means surplus deposit funding.
- Distinction from other gaps: “rate-sensitive gap” relates to interest rate risk (timing of re‑pricing), not liquidity; “total assets minus total liabilities” is balance sheet net worth, not a funding shortfall measure.

2) Step‑by‑step reasoning
- Financing need arises when loans > deposits. The straightforward measure is Loans − Deposits (often computed as averages over a period to smooth volatility).
- That difference directly quantifies the amount that must be financed by wholesale borrowing, capital, or liquid asset run‑down.

3) Calculation example (intermediate steps)
- Suppose average loans = $120 million and average deposits = $95 million.
- Financing gap = average loans − average deposits = $120m − $95m = $25 million.
- Interpretation: $25m must be sourced externally (wholesale funding, interbank market, or liquid assets).

4) Why the correct answer is correct
- Option d (average loans minus average deposits) precisely measures the bank’s net funding requirement from sources other than deposits, which is the definition of the financing gap used in liquidity measurement.

5) Why the other options are incorrect
- a (total assets − total liabilities): equals equity (net worth), not a liquidity funding shortfall.
- b (rate sensitive assets − rate sensitive liabilities): measures interest‑rate re‑pricing risk, not liquidity funding.
- c (financing requirement plus liquid assets): sums two unrelated items and does not represent the shortfall; financing requirement alone minus available liquid assets would be closer, but this option is wrong as written.
- e (total deposits − core deposits): measures non‑core (volatile) deposits, not the gap between uses and deposit funding.

6) Conclusion
The financing gap is average loans minus average deposits, matching answer d.

In terms of liquidity risk measurement, the financing gap is defined as:单项选择题

类似问题

Which of the following is a measure of the potential losses an FI could suffer as the result of fire-sale disposal of assets?

In terms of liquidity risk measurement, the financing requirement is defined as:

All other things constant, securities that are extremely liquid:[Fill in the blank]

All other things constant, securities that are extremely liquid:[Fill in the blank]

What was the world's first widely adopted biodiversity policy?

The aim of the Paris Agreement is to ensure that the earth’s preindustrial temperature is not exceeded by more than º Celsius.

The IPCC's mission is to Blank ______.

Why have most international agreements for environmental protection been based on the honor system?

更多留学生实用工具

智能学习助手

风格化写作助手

论文查重助手

文献引用助手

课堂转译助手

课堂笔记助手

Quiz搜索助手

学校历年真题

智能刷题助手

智能匹配练习

希望你的学习变得更简单