International Banking

This is a group assignment. You can build a team for maximum 6 persons (each group <=6 members). You can also work on the assignment independently.

The assignment is composed of two questions. Please limit your answer of each question to 1000 words or less. You can use chart and table to illustrate your opinion. Maximum one chart and one table could be used for each question. For the whole assignments please don’t write more than 2000 words. The text of an accepted assignment should be plain formatted, e.g., 1.5 line spaced, one column, 12 point font, A4 paper with proper margins in top/bottom and left/right-hand sides.
The current financial crisis has illustrated starkly how increased funding costs and changes in market liquidity can trigger stock market failures.

1. How to measure bank liquidity risk using publicly available information?

2. Discuss the relationship between bank liquidity risk and bank stock returns.