Question

________ is the possibility that the borrower's creditworthiness is reclassified by the lender at the time of renewing credit. ________ is the risk of changes in interest rates charged at the time a financial contract rate is set.
A) Credit risk; Interest rate risk
B) Repricing risk; Credit risk
C) Interest rate risk; Credit risk
D) Credit risk; Repricing risk

Answer 1

Answer:

D

Explanation:

Credit risk is defined as the possibility of  a bank borrower  failing to meet its requirements in accordance with agreed terms.  banking organisation.

Repricing risk is the risk from difference in timing between  interest rate changes or cash flows from assets, liabilities, and off-balance sheet instruments