Off-balance sheet risk taking involves:
A) underwriting U. S. Treasury securities
B) offering fiduciary services
C) seeking capital gains from corporate stocks
D) generating fee income by assuming contingent liabilities

Question

Quizplus · Accepted Answer

Off-balance sheet risk taking often involves generating fee income by assuming contingent liabilities, which are not recorded on the balance sheet until the contingent event occurs. This can include activities like issuing letters of credit, derivatives, or guarantees, which do not appear as assets or liabilities until the contingent event happens.

Off-Balance Sheet Risk Taking Involves