Banks, Insurance Companies, and Fund Management

Free GARP FRM Part I lesson in Financial Markets and Products. 21 min read, ~3,178 words.

Banks face credit, market, operational, and liquidity risk; capital is sized to absorb unexpected loss; banking book holds loans at amortized cost while the trading book is mark-to-market. Originate-to-distribute lets banks earn fees without holding loans, but weakens screening incentives, a key driver of the 2007-09 crisis. Insurers split into...

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