Your CRO asks you to prepare a list of early warning indicators for liquidity problems for your bank. Which of the following are early warning indicators
of a potential liquidity problem?
I. Rapid asset growth especially when funded with potentially volatile liabilities
II. Growing concentrations in assets or liabilities
III. An increase of the weighted average maturity of liabilities
IV. Reduction in the frequency of positions approaching or breaching internal or regulatory limits
V. Narrowing debt or credit default swap spreads
VI. Counterparties that request additional collateral for credit exposures
VII. Increasing redemptions of CDs before maturity
A. I II VI and VII
B. I III V and VI
C. II IV V and VII
D. I V VI and VII
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