Banking Awareness - Banking Acts, Reforms & Risk Management
Which of the following best summarises the purpose of a bank’s overall risk management framework?
Which of the following best summarises the purpose of a bank’s overall risk management framework?
hard Q10 of 15
Step-by-Step Solution
Step 1: Recall the trade-off in banking
Higher returns usually involve higher risks.Step 2: Identify the balanced approach
Risk management aims to balance risk with acceptable returns.Final Answer:
Balancing risk and return prudently → Option BQuick Check:
Prudent balance of risk and return = core framework goal ✅
Quick Trick: Risk management = balance, not avoidance.
Common Mistakes:
MISTAKES- Thinking banks should avoid all risks completely.
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