CFI CBCA Core Course Assessment 1
UPDATED 2025/2026 COMPLETE
QUESTIONS AND VERIFIED CORRECT
ALREADY GRADED SOLUTIONS || 100%
GUARANTEED PASS <<BRAND NEW
VERSION>>
1) Loan approval documentation - ANSWER ✓ Term sheet, loan
agreement, commitment letter
2) Monitoring documentation - ANSWER ✓ Annual review;
monthly/quarterly report
3) Which of the following is the correct order of documentation
submission in the loan approval process? - ANSWER ✓ Loan
application -> Term sheet -> Commitment letter -> Loan
agreement
4) What is a term sheet? - ANSWER ✓ A non-binding agreement
given to the borrower that summarizes primary terms including the
interest rate, time to maturity, and security.
5) What are covenants? - ANSWER ✓ Clauses in a loan agreement
outlining what a borrower must maintain or what they are
restricted from doing.
6) Which of the following are monitoring documents commonly
provided by a borrower on a monthly or quarterly basis? Select all
, correct answers. - ANSWER ✓ Compliance certificates, Unaudited
financial statements, Tax returns
7) Financial statement review - ANSWER ✓ Involves re-assessing
the cash flow and financial position of the borrower.
8) Security review - ANSWER ✓ Involves re-assessing any assets
that are being used as protection in the case of default.
9) Management review - ANSWER ✓ Involves re-assessing any
changes that have occurred within management that may impact
the business' ability to tackle potential issues.
10) Business review - ANSWER ✓ Involves re-assessing the
direction of the business, potential opportunities, and other issues
the company is facing.
11) Which of the following is NOT a reason to perform an annual
review on a borrower? - ANSWER ✓ An annual review gives a
borrower a sense of general loan parameters such as the interest
rate, time to maturity, and security.
12) Which of the following is a reason to perform an annual
review on a borrower? - ANSWER ✓ An annual review provides
an opportunity to do a comprehensive re-assessment.
An annual review allows a lender to re-assess and meet a
borrower's changing needs.
An annual review helps a lender identify a borrower's business
trends, early warning signs and mitigate credit risk.
13) Which of the following activities will be performed during a
security review? - ANSWER ✓ A re-assessment of personal and
corporate guarantors.
, 14) Which of the following is the best reason to take on debt
instead of equity? - ANSWER ✓ Debt is non-dilutive.
15) Which of the following types of debt ranks the LOWEST on
the capital stack? - ANSWER ✓ Mezz unsecured
16) Which debt repayment profile pays only interest throughout
the loan term, and pays off the full principal at the end of the loan
term? - ANSWER ✓ Bullet repayment
17) Which of these business categories are not on the banking
spectrum? - ANSWER ✓ Company banking
18) Which of these business categories are on the banking
spectrum? - ANSWER ✓ Corporate Banking
Commercial Banking
Business Banking
19) Which of the following components make up the overall
interest rate that is charged on the client's loan? - ANSWER ✓
Spread + Cost of Funds
20) Based on the following scenarios, choose which company's
loan request would have the least favorable loss given default
score. - ANSWER ✓ Company Y is requesting a loan to finance
the acquisition of a smaller company in their industry.
21) Which of the following is NOT part of the risk-adjusted
return formula? - ANSWER ✓ Capital Requirement
22) Which of the following is part of the risk-adjusted return
formula? - ANSWER ✓ Interest Revenue
, Closing Fees
Exposure at Default
23) Using the following information, calculate the risk-adjusted
return.
•Loan Amount: $10,000,000
•Interest Rate: 5.0%
•Cost of Funds: 2.75%
•Fees: 10,000
•Expenses: 5,000
•Loss Given Default Rate: 25%
•Default Probability: 0.5% - ANSWER ✓ = 217,500
24) Using the following information, calculate the risk-adjusted
capital.
•Loan Amount: $10,000,000
•Capital Requirement: 12%
•Capital Ratio: 25% - ANSWER ✓ $300,000
Using the following information, calculate the RAROC.
•Risk-Adjusted Return: $80,000
•Loan Amount: $3,000,000
•Capital Requirement: 10%
•Capital Ratio: 75% - ANSWER ✓ 35.56%
25) Which of the following was NOT discussed in this course
within the context of client negotiation levers? - ANSWER ✓ Loan
Type
26) Which of the following was discussed in this course within
the context of client negotiation levers? - ANSWER ✓ All-in Rate
Amortization Period
Loan to Value
UPDATED 2025/2026 COMPLETE
QUESTIONS AND VERIFIED CORRECT
ALREADY GRADED SOLUTIONS || 100%
GUARANTEED PASS <<BRAND NEW
VERSION>>
1) Loan approval documentation - ANSWER ✓ Term sheet, loan
agreement, commitment letter
2) Monitoring documentation - ANSWER ✓ Annual review;
monthly/quarterly report
3) Which of the following is the correct order of documentation
submission in the loan approval process? - ANSWER ✓ Loan
application -> Term sheet -> Commitment letter -> Loan
agreement
4) What is a term sheet? - ANSWER ✓ A non-binding agreement
given to the borrower that summarizes primary terms including the
interest rate, time to maturity, and security.
5) What are covenants? - ANSWER ✓ Clauses in a loan agreement
outlining what a borrower must maintain or what they are
restricted from doing.
6) Which of the following are monitoring documents commonly
provided by a borrower on a monthly or quarterly basis? Select all
, correct answers. - ANSWER ✓ Compliance certificates, Unaudited
financial statements, Tax returns
7) Financial statement review - ANSWER ✓ Involves re-assessing
the cash flow and financial position of the borrower.
8) Security review - ANSWER ✓ Involves re-assessing any assets
that are being used as protection in the case of default.
9) Management review - ANSWER ✓ Involves re-assessing any
changes that have occurred within management that may impact
the business' ability to tackle potential issues.
10) Business review - ANSWER ✓ Involves re-assessing the
direction of the business, potential opportunities, and other issues
the company is facing.
11) Which of the following is NOT a reason to perform an annual
review on a borrower? - ANSWER ✓ An annual review gives a
borrower a sense of general loan parameters such as the interest
rate, time to maturity, and security.
12) Which of the following is a reason to perform an annual
review on a borrower? - ANSWER ✓ An annual review provides
an opportunity to do a comprehensive re-assessment.
An annual review allows a lender to re-assess and meet a
borrower's changing needs.
An annual review helps a lender identify a borrower's business
trends, early warning signs and mitigate credit risk.
13) Which of the following activities will be performed during a
security review? - ANSWER ✓ A re-assessment of personal and
corporate guarantors.
, 14) Which of the following is the best reason to take on debt
instead of equity? - ANSWER ✓ Debt is non-dilutive.
15) Which of the following types of debt ranks the LOWEST on
the capital stack? - ANSWER ✓ Mezz unsecured
16) Which debt repayment profile pays only interest throughout
the loan term, and pays off the full principal at the end of the loan
term? - ANSWER ✓ Bullet repayment
17) Which of these business categories are not on the banking
spectrum? - ANSWER ✓ Company banking
18) Which of these business categories are on the banking
spectrum? - ANSWER ✓ Corporate Banking
Commercial Banking
Business Banking
19) Which of the following components make up the overall
interest rate that is charged on the client's loan? - ANSWER ✓
Spread + Cost of Funds
20) Based on the following scenarios, choose which company's
loan request would have the least favorable loss given default
score. - ANSWER ✓ Company Y is requesting a loan to finance
the acquisition of a smaller company in their industry.
21) Which of the following is NOT part of the risk-adjusted
return formula? - ANSWER ✓ Capital Requirement
22) Which of the following is part of the risk-adjusted return
formula? - ANSWER ✓ Interest Revenue
, Closing Fees
Exposure at Default
23) Using the following information, calculate the risk-adjusted
return.
•Loan Amount: $10,000,000
•Interest Rate: 5.0%
•Cost of Funds: 2.75%
•Fees: 10,000
•Expenses: 5,000
•Loss Given Default Rate: 25%
•Default Probability: 0.5% - ANSWER ✓ = 217,500
24) Using the following information, calculate the risk-adjusted
capital.
•Loan Amount: $10,000,000
•Capital Requirement: 12%
•Capital Ratio: 25% - ANSWER ✓ $300,000
Using the following information, calculate the RAROC.
•Risk-Adjusted Return: $80,000
•Loan Amount: $3,000,000
•Capital Requirement: 10%
•Capital Ratio: 75% - ANSWER ✓ 35.56%
25) Which of the following was NOT discussed in this course
within the context of client negotiation levers? - ANSWER ✓ Loan
Type
26) Which of the following was discussed in this course within
the context of client negotiation levers? - ANSWER ✓ All-in Rate
Amortization Period
Loan to Value
