Describe the role of Central bank as The Bankers Bank-00154
This subjective question is related to the book/course
vu bt301 Introduction to Biotechnology.
It can also be found in
vu bt301 Mid Term Solved Past Paper No. 3.
Question 1: Describe the role of Central bank as "The Bankers Bank".
Answer:
The central Bank works as a Banker's Bank. The role which it plays is - Lender of last resort.
- If banks go illiquid or during financial stress central bank provide discount loans to banks.
- Manage interbank payment system
- Monitors the working of banks and stabilizing financial system
