Securitization enables a bank to: O a. Move assets off its balance sheet O b. Shift credit risk onto investors Oc.a and c Od. Increase its credit risk
Q: What are the bank’s total risk-weighted assets
A: Risk weighted Assets- Meaning To ascertain the minimum capital that must be held by banks and…
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A: The possibility of a loss arising from a borrower's inability to repay a loan or meet legally…
Q: What are the implications of the transformation function for the liquidity position of the bank?
A: Answer: Introduction: Liquidity is nothing but the ability of the bank to turn money into cash and…
Q: explain three important factors that account for challenges to liquidity risk management in a…
A: Banks maintain reserves to meet short-term expenses and obligations. Reserves are required when the…
Q: How does a bank reconcile between liquidity and profitability.
A: Meaning of liquidity and profitability Liquidity- is the ability of the bank to meet its…
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A: Bank assets are loans advances made by the bank. Bank will receive interest from this loans and…
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A: Funds Requirement € 10,000 Promissory Note-1 € 5,500 Maturity period 30 days…
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A: The company's information is provided in the financial statement of the company which is useful for…
Q: a. Securitization b. liquidation c. notarization d. intermediation) is an example of bank…
A: Option a is the correct answer
Q: Banks improves the liquidity of the bank by
A: The correct answer is c. Generating additional income from investment
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A: Financial Ratio Analysis: Financial ratio analysis is one of the tools of financial analysis of a…
Q: Which one is not the core functions of investment bank? * a.Selling of securities b.…
A: Investment banks are the financial service provider generally works as an intermediary or broker for…
Q: a. “A robust financial market is one of the pillars of stable economic growth and secured financial…
A: Financial market is a place that helps in transferring the money from those who have surplus funds…
Q: effect to asset, liability and owner's equity if the company repays the bank loan
A: Bank loan is the amount borrowed from the bank. Upon repayment of bank loan, the bank loan account…
Q: A bank is insolvent if Group of answer choices its assets are less than its liabilities. it is…
A: Accounting insolvency happens when the value of a company's debts is more than the value of its…
Q: t in heightened risk exposure. Give examples of two (2)
A: Introduction : Assets and liabilities which do not display on a corporation 's balanced sheet are…
Q: If a bank has , rate-sensitive assets than liabilities, then in interest rates will increase bank…
A: Lets understand the meaning of rate sensitive asset and liabilities. Rate sensitive asset and…
Q: Mention and explain the major line items on a bank’s income statement. What can the numbers on an…
A: Financial statement of a bank is different from others because they usually do not have inventory or…
Q: When both deposit and loan interest rates decrease at the same speed in the market, a bank tends to…
A: Loan interest rate is the rate at which interest is charged by bank on the lent amount. Deposit is…
Q: ring and explain its advantages and disadvantages. Why might a bank be interested in a company’s…
A: Gearing : In simple words, gearing refers to the ratio of the company debt to equity. It depicts how…
Q: Balance Sheet Insolvency occurs when Liabilities are greater than the Assets resulting in negative…
A: Insolvency Risk: Insolvency risk is a probability that an enterprise cannot satisfy its debt…
Q: If you are a bank assessing the long-term credit of a company, you are usually most interested in…
A: The term "liquidity" describes a company's capacity to quickly sell off assets to earn cash as well…
Q: Why must a balance sheet always balance? What are the major assets and claims on a commercial bank’s…
A: Balance sheet is called as statement of assets and liabilities. Liabilities represent claims of the…
Q: Why have off-balance-sheet activities been a growing source of bank profits and what are the…
A: Off-balance sheet is defined as an assets, debts, or the financing activities, which does not…
Q: When both deposit and loan interest rates increase at the same speed in the market, a bank tends to…
A: When both deposit rates and lending rates increase the bank tends to make profit out of this. Always…
Q: ratios recommended to manage liquidity risk for a
A: Step 1 The risk of insolvency can be reduced by monitoring and evaluating the financial system,…
Q: If the deposits/loans ratio is relatively high for a bank, this implies an emphasis on: a.…
A: Deposits /Loans as the name suggest implies the number of deposits financed as loans. If it is…
Q: As a risk mitigating manager write a short note on asset – Asset liability management (ALM) and its…
A: Bank is an organization where deposits are accepted from the surplus units and loan is provided to…
Q: all of the following statements about a bank's capital are correct except: bank capital is the…
A: Bank’s capital is the lifeblood for its operations. It shows assets in the form of loan provided and…
Q: The _____ ratio gives actual losses on loans, while the ______ ratio gives the extent to which the…
A: Bank provide loans to borrowers but given are risk to banks So loans may occur loss to banks.
Q: A. Apart from the information arising from your analysis what other information would you advise the…
A: Answer:- Decision making meaning:- The process of choosing choices by identifying a decision,…
Q: Which of the following would increase cash flow for a firm? a. A purchase of fixed assets b. Cash…
A: In this question we are given 4 options related to cash flow and we require to select the correct…
Q: Which of the following functions of the Commercial Bank's primary functions is influence by the…
A: Solution:- Reserve Requirement Ratio (RRR) means the minimum amount of deposit a bank has to keep…
Q: One of the following statement is true about strategies of liquidity management Select one: O a.…
A: Liquidity management measures the efficiency of meeting financial requirements of the business by…
Q: Explain the following concepts in relation to the role that banks play in financial markets: i)…
A: A bank is a financial institution that serves as a mediator between surplus units and deficit units,…
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- Question 20 of 30: Securities backed by mortgage is the example of O Securitization O Take-out finance O Factoring O Pooling and transfetIdentify under which one of the following market the issue of treasury bills lies: a.Equity Market b.Capital Market c.Foreign Currency Market d. **fast i dont have time plzMoney Market18- text _____________ is one of the financial market instruments which grants a short-term loan that is usually sanctioned by the banks for importers and exporters to finance specific transactions. a. Share Acceptance b. Bond Acceptance c. Repurchase Acceptance d. Bankers’ Acceptance
- Question 9 The credit risk of investing in bonds is also known as: A seesaw wffect B) default risk (C) reinvestment risk (D) exchange rate riskIdentify under which one of the following market the issue of treasury bills lies: a.Equity Market b.Capital Market c.Foreign Currency Market d.Money Market **fast plzExercise 15-1 (Static) Debt and equity securities and short- and long-term investments LO C1 Complete the following descriptions by selecting the appropriate option. 1. Debt securities reflect a(n) 2. Equity securities reflect a(n) 3. Short-term investments are securities that (1) management intends to convert to cash within or the 4. Long-term investments in securities are defined as those securities that are convertible to cash or are relation such as with investments in notes and bonds. relation such as with investments in shares of stock. whichever is longer, and (2) are readily convertible to to be converted into cash in the short term.
- Question 6 Interest rate swap Why might an individual or organisation be willing to swap fixed-rate loans for floating-rate loans? A. They may perceive that interest rates are ready to increase. B. Their cash flows may vary directly with interest rates. C. Floating rates are not lower than fixed rates. D. They may be able to postpone the payment of principal.Question 2 a) Give an example of how a swap might be used by a portfolio manager. b) Explain the nature of the credit risks to a financial institution in a swap agreement.16-If the underlying transaction gives you denominated in a foreign currency, the general principle behind a money market hedge states that you need an equivalent liability in the money market to provide a hedge. a. a forward contract b. a foreign bank account c. a liability d. an asset
- Ch 11 Bonds and LTL1. When will bonds sell at a premium and discount? 2. Calculate bond interest under SL method.3. Impact of amortization of bond premium/discount on interest expense.4. Give an example journal entry for amortization of bond premium/discount.5. What is the Gain/loss on redemption of bonds? How do you calculate?6. Understand method of calculating PV of future cash flows -specifically for a bond.7. Why are bonds a popular source of financing?8. Contract rate (market rate) is used for what calculation purpose?Ch 10 SE: Corporations1. What are Rights possessed by common stockholders?2. What are a journal entries for stock issuance, cash dividend, stock dividend?3. What is the calculation of dividends when cumulative preferred stock is outstanding?4. Journal entries for treasury stock, financial statement presentation. Gain/loss on reissue of treasury stock.5. Prior period adjustment - example of, accounting for?6. define, describe, why use Stock split 7. Stock dividend –…Question 23 Credit-rating agency ratings are associated with which of the following investor risks? interest rate risk default risk O purchasing power risk reinvestment risk DELLD Question 7 Prior to the 2008 financial crisis, if the central bank is interested in performing an expansionary monetary policy, which of the following methods could it adopt? Selling bonds, decreasing the discount rate, or increasing the reserve requirement O Buying bonds, increasing the discount rate, or decreasing the reserve requirement O Selling bonds, increasing the discount rate, or increasing the reserve requirement O Buying bonds, decreasing the discount rate, or decreasing the reserve requirement