FINA 3317 - Chapter 14 Exam Latest Update
Which of the following trends in the number and industry assets of savings institutions
is/are correct?
I. The number of savings institutions has fallen over time.
II. The number of savings institutions has increased over time.
III. Total industry assets fell during the recession of the late 2000s.
IV. Total industry assets are falling over time.
V. Total industry assets are stable but the number of savings institutions has fallen. -
ANSWER I and III only
The QTL test requires that thrifts: - ANSWER invest at least 65 percent of their assets in
mortgages or mortgage-related assets.
Which one of the following has the highest concentration of mortgage-related assets on
the balance sheet? - ANSWER Savings institutions
After 2011, savings institutions have primarily been regulated by the: - ANSWER Office
of the Comptroller of the Currency.
In 2019, the largest U.S. savings institution was: - ANSWER Charles Schwab Bank.
The predominant liabilities for savings institutions are: - ANSWER transaction accounts
and small time and savings deposits.
Historically, most savings institutions were established as: - ANSWER mutual
organizations.
Deposits at savings banks are backed by the _______________ and deposits at
savings institutions are backed by the ______________. - ANSWER DIF; DIF
_____________ are the most diversified of depository institutions and ______________
are on average the largest depository institutions. - ANSWER Commercial banks;
commercial banks
, Credit unions are:
I. mutual associations.
II. not open to the general public.
III. for profit institutions. - ANSWER I and II only
The U.S. Central Credit Union and the corporate credit union: - ANSWER provide
investment and liquidity services to corporate credit unions.
Credit unions have several advantages over banks. These include the following:
I. Credit unions are not taxed.
II. Credit unions are better diversified than banks
.III. Credit unions can collectively pool funds.
IV. Due to regulations, credit unions have better economies of scale and scope than
banks.
V. Because of their ties to employers, credit unions have better personnel expertise
than banks - ANSWER I and III only
As a percentage of total assets, credit unions invest _______________ in securities
than savings institutions and ______________ in consumer loans than commercial
banks. - ANSWER more; more
SI profitability declined in the mid-2000s due to:
I. the yield curve becoming more positively sloped.
II. decreases in the NIM ratio.
III. increases in the NIM ratio.
IV. the yield curve becoming flatter and even inverted. - ANSWER II and IV only
Rank the following from greatest to smallest in terms of industry asset size in 2019.
I. Banks
II. Savings institutions
III. Credit unions
IV. Finance companies - ANSWER I, IV, III, II
In 2019, _______________ had on average the greatest amount of equity as a
percentage of assets and ______________ had the lowest. - ANSWER finance
companies; credit unions
Factoring is: - ANSWER purchasing corporate accounts receivables at a discount.
Sales finance companies: - ANSWER specialize in making loans to customers of a
specific retailer or manufacturer.
Which of the following trends in the number and industry assets of savings institutions
is/are correct?
I. The number of savings institutions has fallen over time.
II. The number of savings institutions has increased over time.
III. Total industry assets fell during the recession of the late 2000s.
IV. Total industry assets are falling over time.
V. Total industry assets are stable but the number of savings institutions has fallen. -
ANSWER I and III only
The QTL test requires that thrifts: - ANSWER invest at least 65 percent of their assets in
mortgages or mortgage-related assets.
Which one of the following has the highest concentration of mortgage-related assets on
the balance sheet? - ANSWER Savings institutions
After 2011, savings institutions have primarily been regulated by the: - ANSWER Office
of the Comptroller of the Currency.
In 2019, the largest U.S. savings institution was: - ANSWER Charles Schwab Bank.
The predominant liabilities for savings institutions are: - ANSWER transaction accounts
and small time and savings deposits.
Historically, most savings institutions were established as: - ANSWER mutual
organizations.
Deposits at savings banks are backed by the _______________ and deposits at
savings institutions are backed by the ______________. - ANSWER DIF; DIF
_____________ are the most diversified of depository institutions and ______________
are on average the largest depository institutions. - ANSWER Commercial banks;
commercial banks
, Credit unions are:
I. mutual associations.
II. not open to the general public.
III. for profit institutions. - ANSWER I and II only
The U.S. Central Credit Union and the corporate credit union: - ANSWER provide
investment and liquidity services to corporate credit unions.
Credit unions have several advantages over banks. These include the following:
I. Credit unions are not taxed.
II. Credit unions are better diversified than banks
.III. Credit unions can collectively pool funds.
IV. Due to regulations, credit unions have better economies of scale and scope than
banks.
V. Because of their ties to employers, credit unions have better personnel expertise
than banks - ANSWER I and III only
As a percentage of total assets, credit unions invest _______________ in securities
than savings institutions and ______________ in consumer loans than commercial
banks. - ANSWER more; more
SI profitability declined in the mid-2000s due to:
I. the yield curve becoming more positively sloped.
II. decreases in the NIM ratio.
III. increases in the NIM ratio.
IV. the yield curve becoming flatter and even inverted. - ANSWER II and IV only
Rank the following from greatest to smallest in terms of industry asset size in 2019.
I. Banks
II. Savings institutions
III. Credit unions
IV. Finance companies - ANSWER I, IV, III, II
In 2019, _______________ had on average the greatest amount of equity as a
percentage of assets and ______________ had the lowest. - ANSWER finance
companies; credit unions
Factoring is: - ANSWER purchasing corporate accounts receivables at a discount.
Sales finance companies: - ANSWER specialize in making loans to customers of a
specific retailer or manufacturer.
