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Inquiry:
A credit analyst is evaluating the liquidity position of a small regional bank as part of preparing a detailed report for an upcoming credit committee meeting. Over the past three years, the analyst has utilized quarterly financial statements to calculate several key liquidity metrics. In the context of this analysis, which of the following trends should the analyst carefully monitor and highlight in the credit risk report during this period?
A
The bank's average net federal funds and repurchase agreements position has been increasing.
B
The bank's capacity ratio has been increasing.
C
The bank's pledged securities ratio has been decreasing.
D
The bank's loan commitments ratio has been decreasing.