Q:
Answer
RAROC is a risk-adjusted framework for profitability measurement and profitability management. It is a tool for measuring risk-adjusted financial performance. And it provides a uniform view of profitability across businesses (Strategic Business Units / divisions). RAROC and related concepts such as RORAC and RARORAC are mainly used within (business lines of) banks and insurance companies. RAROC is defined as the ratio of risk-adjusted return to economic capital.
View answer
Workspace
Report Error
Discuss
Aptitude and Reasoning
General Knowledge
Puzzles
Interviews
Technical
Certifications
Exams
Job
Roles
True or False
Exams