Answers 1. Summarisation Bayba Financial Services was a company operating in Gambia.

Due to various reasons one day it was not able to meet its obligations which is a condition normally known as bankruptsy. Therefore the Central Bank of Gambia appointed its administrators to oversee the operations in the intervening period. Eco Bank which has already 500 branches in Africa was inbterested and took over Bayba from the Central Bank. Rumors circulated that this sale was orchetrated by the former owner of Bayba from his UK hideout. This was fueled by the fact that the sale was not transparent. 2. In case any client wants to deal with Eco Bank, the risk is very low since the size of the Bank is much larger than the stake purchased in Babya. With 500 Pan African branches, the stake in Babya may not be even 5% of the capital of Eco Bank.

3. Operational Risk is defined as the risk of loss resulting from inadequate or failed processes, people, and systems or from external events. The definition includes legal risk, which is the risk of loss resulting from failure to comply with laws as well as prudent ethical standards and contractual obligations. It also includes exposure to litigation from all aspects of an institutions activities.

4. Market risk is the risk that the value of a portfolio, either an investment portfolio or a

trading portfolio, will decrease due to the change in value of the market risk factors. The four standard market risk factors are stock prices, interest rates, foreign exchange rates, and commodity prices. The associated market risks are: Equity risk, the risk that stock or stock indexes (e.g. Euro Stoxx 50, etc. ) prices and/or their implied volatility will change. Interest rate risk, the risk that interest rates (e.g. Libor, Euribor, inflation, etc.) and/or their implied volatility will change. Currency risk, the risk that foreign exchange rates (e.g. EUR/USD, EUR/GBP, etc.) and/or their implied volatility will change. Commodity risk, the risk that commodity prices (e.g. corn, copper, crude oil, etc.) and/or their implied volatility will change. 5. Financial risk an umbrella term for multiple types of risk associated with financing, including financial transactions that include company loans in risk of default.[1][2] Risk is a term often used to imply downside risk, meaning the uncertainty of a return and the potential for financial loss.