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Risk Transformation

A type of risk redistribution (financial transformation) in which financial intermediaries hold assets with higher risk of default than their...

Liquidity Transformation

A type of risk redistribution (financial transformation) which involves the funding of illiquid assets (long-term loans) with liquid liabilities (short-term...

Redistribution of Risk

A process whereby a financial institution capitalizes on mismatches between the two sides of its balance sheet (assets and liabilities)....