when liabilities become due you must ensure that assets can cover them
Illya Gerasymchuk
when liabilities become due you must ensure that assets can cover them
this means ensuring that cashflow and asset monetization provides enough liquidity to settle the debt, plus a desired spread
duration matching protects solvency and liquidity when yields shift
assets are financed by liabilities and equity. financial institutions like banks usually have small equity - so liabilities finance assets
