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Viewing page 13 out of 15 pages

Viewing questions 181-195 out of questions

Questions # 181:

What would happen to a bank’s net interest income if it ran a zero gap in an environment of decreasing interest rates?

Options:

Net interest income would increase slightly.

Net interest income would increase considerably.

Net interest income would decrease.

Net interest income would hardly change at all.

Expert Solution

Questions # 182:

What is the purpose of the Liquidity Coverage Ratio?

Options:

to mitigate market replacement risk across markets

to eliminate funding mismatches by establishing a minimum acceptable amount of stable funding

to ensure that banks have enough high-quality liquid assets to survive a 30-day period of acute market stress

to minimize duration risk on a bank’s assets over a one-year horizon

Expert Solution

Questions # 183:

Any breaches in confidentiality should be:

Options:

documented and reported to the local regulator

communicated to local staff by a confidential internal circular

investigated immediately according to a properly documented procedure

reported to the ACI’s Committee for Professionalism to investigate and advise accordingly

Expert Solution

Questions # 184:

What is an outright forward FX transaction?

Options:

A spot sale (purchase) and a forward purchase (sale)

A spot sale (purchase) and a forward sale (purchase)

An exchange of currencies on a date beyond spot and at a price fixed today

An exchange of currencies on a date beyond spot

Expert Solution

Questions # 185:

What is the name of a swap in which the counterparties sell currencies to each other with a concomitant agreement to reverse the exchange of currencies at a fixed date in the future at the same price, and where the interest rates for the two currencies are reflected in the two exchanges but paid separately?

Options:

aFXswap

an in/out swap

a currency swap

a quanto swap

Expert Solution

Questions # 186:

What is the recommended follow-up procedure in case of a settlement discrepancy?

Options:

All investigation cases should be handled within the same day B. All investigation cases should be handled within 2 days

Investigation cases received before noon should be handled within the same day and those received after midday should be handled before noon the next day

Investigation cases received before noon should be handled within the same day and those received after midday within 24 hours

Expert Solution

Questions # 187:

Which of the following is a characteristic of all liquid assets under Basel III?

Options:

uncertainty of valuation

high correlation with risky assets

listed on a developed and recognized exchange

readily marketable

Expert Solution

Questions # 188:

What does the term “mine” mean when given in response to an FX spot quotation?

Options:

I buy the base currency at the bid rate.

I buy the base currency at the offer rate.

I buy the counter-currency at the offer rate.

I sell you the base currency at the bid rate,

Expert Solution

Questions # 189:

What is the London Gold Price Fix (London Gold Fixing)?

Options:

the gold price fixed twice a day to balance supply and demand in the London bullion market

the gold price fixed at the end of the day in the London bullion market

the gold price fixed at 11:00 am. local time in the London bullion market from a panel of gold traders

the gold price fixed at 11:00 a.m. to settle gold contracts in the London bullion market

Expert Solution

Questions # 190:

When may a broker assume a deal is closed?

Options:

When one of the principals confirms the deal

When the principals give a written undertaking for all deals done at the end of the day

When acknowledgement is received from the principals that the deal is done

When both back offices acknowledge the deal

Expert Solution

Questions # 191:

You are entering into a swap as a fixed rate receiver with Party A and into an offsetting position with party B. All other things being equal, which of the scenarios below will lead to the greatest increase in the sum of the Credit Value Adjustments for A and B?

Options:

upward shift of the swap curve and rating downgrade of party A

downward shift of the swap curve and rating downgrade of party A

downward shift of the swap curve and rating downgrade of party B

downward shift of the swap curve only

Expert Solution

Questions # 192:

What is a hedge?

Options:

A means by which to reduce a risk

An equal and opposite risk

A riskless transaction

A means of cancelling a deal

Expert Solution

Questions # 193:

The spot/next repo rate for the 5% Bund 2018 is quoted to you at 1.75-80%. You sell bonds with a market value of EUR 5,798,692.00 through a sell/buy-back. The Repurchase Price is:

Options:

EUR 5,798,982

EUR 5,799,497

EUR 5,746,376

EUR 5,000,694

Expert Solution

Questions # 194:

You sold a JPY 500,000,000 1x12 FRA at 0.35%. The settlement rate is 11-month (334-day) JPY LIBOR, which is fixed at 0.4450%.

What is the settlement amount at maturity?

Options:

You pay JPY 440,694

You receive JPY 440,694

You pay JPY 438,882

You receive JPY 438,882

Expert Solution

Questions # 195:

Selling a FRA has the same interest rate exposure as:

Options:

Opening a positive gap

Going over-borrowed

Making a forward-forward loan

Taking a forward-forward deposit

Expert Solution

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Viewing questions 181-195 out of questions

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