Delinquency on bank financial performance

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Reference no: EM133272544

Regulators are concerned about credit risk in the banking system and the ability of banks to manage this risk. Briefly explain how regulators use capital adequacy to manage credit risk in the banks loan portfolio.

Delinquency in the loan portfolio is one of the risks in lending.

A. Explain the effects of delinquency on a bank's financial performance, balance sheet and cash flows.

B. List three indicators that lending officers rely on to identify potential default.

Reference no: EM133272544

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