CCAR Seven Principles Exam Questions With
100% Verified Correct Answers.
fiduciary risk
The Risk of loss due to the failure to exercise the applicable high standard of care, to act in the
best interests of clients or to treat clients fairly, as required under applicable law or regulation.
concentration risk
Risk of loss due to higher relative exposure to particular customers, industries,
markets/geographies, products, vendors, or lines of business.
structural risk
Risk of loss due to the structure, or lack thereof, of obligations, such as covenants,
terms, maturity, and conditions.
fraud risk (external)
Risk of loss due to theft of information, hacking damage, third party
theft/misrepresentation and forgery.
fraud risk (internal)
Risk of loss due to misappropriation of assets, tax evasion, incorrect financial
reporting, intentional mismarking of positions, and bribery.
model risk
Risk of loss due to actions taken due to use of quantitative model, which may be using invalid
assumptions, inaccurate data, and/or suboptimal formulas.
equity pricing volatility risk
The Risk of loss arising from the potential adverse changes in the value of the firm's assets
and liabilities resulting from changes equity prices
, credit spread volatility risk
The Risk of loss arising from the potential adverse changes in the value of the firm's assets
and liabilities resulting from changes in credit spreads.
interest rate volatility risk
The Risk of loss arising from the potential adverse changes in the value of the firm's assets
and liabilities resulting from changes in interest rates.
structural interest rate risk
The risk of loss due to interest rate mismatch in the traditional banking activities arising
from the extension of loans and the acceptance of deposits as well as the non-trading
activities associated with actions taken within the Treasury AFS book.
foreign exchange rate volatility
The Risk of loss arising from the potential adverse changes in the value of the firm's assets
and liabilities resulting from changes in foreign exchange rates.
commodity price volatility risk
The Risk of loss arising from the potential adverse changes in the value of the firm's assets
and liabilities resulting from changes in commodity prices.
technology risk
The Risk of loss due to inadequate security, confidentiality, integrity, capability or availability of
systems affecting an organization's operations, assets, customers, shareholders or employees.
This includes business continuity and disaster recovery.
execution, process and delivery risk
Risk of loss due to deficient/failed processes/controls or process management; relations
with trade/counterparties; transaction capture, execution, maintenance, and human error
mergers and acquisition risk
100% Verified Correct Answers.
fiduciary risk
The Risk of loss due to the failure to exercise the applicable high standard of care, to act in the
best interests of clients or to treat clients fairly, as required under applicable law or regulation.
concentration risk
Risk of loss due to higher relative exposure to particular customers, industries,
markets/geographies, products, vendors, or lines of business.
structural risk
Risk of loss due to the structure, or lack thereof, of obligations, such as covenants,
terms, maturity, and conditions.
fraud risk (external)
Risk of loss due to theft of information, hacking damage, third party
theft/misrepresentation and forgery.
fraud risk (internal)
Risk of loss due to misappropriation of assets, tax evasion, incorrect financial
reporting, intentional mismarking of positions, and bribery.
model risk
Risk of loss due to actions taken due to use of quantitative model, which may be using invalid
assumptions, inaccurate data, and/or suboptimal formulas.
equity pricing volatility risk
The Risk of loss arising from the potential adverse changes in the value of the firm's assets
and liabilities resulting from changes equity prices
, credit spread volatility risk
The Risk of loss arising from the potential adverse changes in the value of the firm's assets
and liabilities resulting from changes in credit spreads.
interest rate volatility risk
The Risk of loss arising from the potential adverse changes in the value of the firm's assets
and liabilities resulting from changes in interest rates.
structural interest rate risk
The risk of loss due to interest rate mismatch in the traditional banking activities arising
from the extension of loans and the acceptance of deposits as well as the non-trading
activities associated with actions taken within the Treasury AFS book.
foreign exchange rate volatility
The Risk of loss arising from the potential adverse changes in the value of the firm's assets
and liabilities resulting from changes in foreign exchange rates.
commodity price volatility risk
The Risk of loss arising from the potential adverse changes in the value of the firm's assets
and liabilities resulting from changes in commodity prices.
technology risk
The Risk of loss due to inadequate security, confidentiality, integrity, capability or availability of
systems affecting an organization's operations, assets, customers, shareholders or employees.
This includes business continuity and disaster recovery.
execution, process and delivery risk
Risk of loss due to deficient/failed processes/controls or process management; relations
with trade/counterparties; transaction capture, execution, maintenance, and human error
mergers and acquisition risk
