Credit risk faced by commercial banks and moral hazard

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Reference no: EM131387562

1. Credit Risk faced by commercial banks:

a. Why is credit-risk an issue for commercial banks?

b. Discuss in detail the different steps banks can undertake to combat credit-risk.

2. Moral Hazard

i) Did the moral hazard problem with investment banks get better or worse since the 80s? Explain

ii) Discuss one way in which there has been an effort to reduce moral hazard in the stock market.

Reference no: EM131387562

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