Author Description

The core functions of banks are money creation, performing a transformation function and executing payment orders of their clients. Apart from these 'utility functions', banks act, amongst others, as a market maker for financial instruments and they trade on their own behalf. With all the activities that they perform, banks are exposed to risks: i.e. interest risk, market risk, credit risk, liquidity risk and operational risk. This books provides a thorough understanding of all risks that a bank either is faced with as a consequence of its core activities or deliberately seeks. The book also describes the risk management structure of a bank and discusses the relationship between risk management and asset and liability management. Unlike most other books about banking risks, this book contains practically no equations. Every topic is discussed in a conceptual way. This makes the book readable for those who want to know more about banking risk without running the chance to get overwhelmed by mathematical challenges.