Much critical attention has been given in recent years to market and
credit risks, which have a significant effect on corporate and financial
operations and must be understood and managed with care. While these
areas have rightly received considerable scrutiny, another critical
dimension of financial risk - based on corporate liquidity - has been
largely overlooked. Liquidity risk is the risk of loss arising from an
inability to quickly realise asset value or obtain funding and can be
damaging if not properly considered or actively managed. Lack of
liquidity can lead to large losses in asset/liability portfolios and off
balance sheet activities and in extreme cases can trigger financial
distress and insolvency. Liquidity Risk is a comprehensive treatment of
the topic focusing on the nature of the risk, problems that arise in
asset and funding liquidity and mechanisms that can be developed to
monitor, measure and control such risks.