c. Market risk represents the risk
posed to a financial institution's condition resulting from adverse movements
in market rates or prices, such as interest rates, foreign exchange rates,
equity prices and commodity price. Even a slight
variation in market variables bring about substantial variation in income and
economic value of the bank. Market risk takes the form of:
1.
Interest Rate Risk
2.
Foreign Exchange Rate (Forex) Risk
3.
Commodity Price Risk and
4.
Equity Price Risk
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