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    Question

    The bank bought a 5 year G-Sec with YTM of 7.6% and

    plans to sell them in 2 weeks. The bond could not be sold within 2 weeks due to over sight and as a result the bank had to incur loss. This loss would be the result of ________
    A Market risk Correct Answer Incorrect Answer
    B Gap risk Correct Answer Incorrect Answer
    C Operational risk Correct Answer Incorrect Answer
    D Funding risk Correct Answer Incorrect Answer
    E Interest rate risk Correct Answer Incorrect Answer

    Solution

    Here the risk is due to human error of oversight and is therefore an operational risk.

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