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Glossary of terms - Banking [2]
02/18/2008 20:59:47 / full of life
Let's have a brief description about Currency Risk and Credit Risk?
Currency Risk:
A DEPRECIATION of the home currency relative to the investment in bank is referred to currency risk. International investor’s total returns can be significantly affected by the exchange rate between their home/reference currency and the currency in which their foreign assets are denominated.
Credit Risk:
This is usually a default risk associated to the bank when a new customer joins to a bank. This Can be more clearly mentioned as the risk of loss due to a debtor's NON-PAYMENT of a loan or other line of credit (either the principal or interest or both).
Enjoy!!!!!!!!!!
Best regards,
Ryhana
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