A

1

**Credit Risk:**

Nations Trust Bank faces credit risk associated with its loan portfolio

Economic downturns, industry-specific issues, or adverse changes in borrowers' financial conditions could lead to higher default rates, impacting the bank's asset quality.

B

2

**Interest Rate Risk:**

Fluctuations in interest rates may expose the bank to interest rate risk, affecting the net interest margin

A sudden and significant change in interest rates could impact the valuation of fixed-rate assets and liabilities.

C

3

**Market Risk:**

Nations Trust Bank is exposed to market risk, especially in its investment portfolio

Changes in market conditions, such as fluctuations in equity prices or interest rates, could impact the value of the bank's investments.

D

4

**Operational Risk:**

Operational risk arises from internal processes, systems, and external factors

Disruptions, cyber threats, or inadequate internal controls pose operational risks that may impact the bank's efficiency and financial stability.

E

5

**Liquidity Risk:**

The bank faces liquidity risk, primarily related to its ability to meet short-term financial obligations

A sudden outflow of deposits or inability to access funding sources may pose challenges to maintaining adequate liquidity.