The correct answer is B.

Retail banking involves dealing with individual customers or small businesses. The credit exposures in retail banking are typically smaller and more frequent, often referred to as 'bite-sized' pieces. This means that the default of a single customer or a small business is unlikely to pose a significant threat to the bank's financial stability. This is because the total exposure is spread across a large number of customers, thereby diversifying the risk. Even if a single customer defaults, the loss incurred by the bank is relatively small and manageable. This characteristic of retail banking helps in mitigating the risk and ensuring the bank's financial stability.

Choice A is incorrect. While it's true that individual exposures by a single consumer are not expensive enough to threaten the bank, retail banking credit exposures do not arrive in large pieces. They typically come in smaller, more frequent amounts.

Choice C is incorrect. Corporate exposures do not arrive in bite-pieces; they usually come in larger amounts due to the nature of corporate transactions and loans. Also, repayment of one facility does not necessarily have to occur before a new one can be offered.

Choice D is incorrect. Although corporate credit exposures often arrive in large pieces, it's misleading to suggest that individual corporate exposures rarely threaten the bank. In fact, due to their size, these types of exposure can pose significant risk if the corporation defaults on its obligations.

Things to Remember

• Retail banking credit exposure is characterized by a high volume of small, "bite-sized" loans, contrasting sharply with the larger, less frequent loans typical in corporate banking.