Liquidity Risk: It can be defined as the risk in which  a bank is not being able to finance its day to day operations. The affects of this risks are severe like : inability to manage this risk could lead downfall of the bond pricing and ratings of the bank in the money market.

Country Risk: Country risk can be define as  the risk in which a country won’t be able to honour its financial commitments. It is a condition in which  a country defaults on its obligations and  it can harm the performance of all other financial instruments in that country as well as other countries it has relations with. Country risk has implications over  to stocks, bonds, mutual funds, options and futures that are issued within a particular country.

Operational Risk: As per the “The Basel Committee on Banking Supervision” this risk is define as a  operational risk of loss resulting from inadequate or failed internal processes, people, and systems or external events.

There are three main reasons of this risk:

  • Human Intervention & Error
  • Failure of the IT/internal software & systems.
  • Failure of Internal Processes to transmit data & information accurately

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