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The answer says the currency exposire is not a part of CAMELS approach, but indeed it is part of Sensitivity (S) of camels, why is there a contradiction here
Answers (1)
In this example the bank doesn’t seem to have foreign currency loan/deposit exposure. That is the reason it is mentioned that it would not be covered. But as you rightly pointed out currency exposure is also included in sensitivity. I think the question is asking for this specific case.