Banking Practice Exam

Expense management refers to the systematic approach that banks take to monitor, control, and reduce their operational costs. This process includes analyzing various areas of spending, identifying inefficiencies, and implementing strategies to improve cost-effectiveness. By focusing on expense management, banks can streamline operations, enhance profitability, and ensure they remain competitive in a constantly evolving financial landscape.

The other options, while related to financial practices, do not specifically denote the process of reducing operational costs. Financial analysis is primarily concerned with assessing a bank's financial performance, revenue enhancement focuses on increasing income, and yield optimization relates to improving returns on investments rather than minimizing expenses. Thus, expense management is the most accurate term for describing the intent to reduce operational costs in a banking context.