A commercial bank must balance its need for liquidity to meet customer withdrawals with the need to invest in profitable assets, resulting in a trade-off between these two objectives.
Liquidity vs. Security Conflict
A commercial bank must balance its need for liquidity to meet customer withdrawals with the need to minimize risk and protect depositors' funds, resulting in a trade-off between these two objectives.
Profitability vs. Security Conflict
A commercial bank must balance its need to earn profits by taking on risk with the need to protect its depositors' funds and maintain financial stability, resulting in a trade-off between these two objectives.
