CQIB LATEST 2026 STUDY GUIDE QUESTIONS AND
ANSWERS RATED A+
✔✔What events occurred in 2000-2017 in the Banking Industry? - ✔✔Renewed
emphasis on corporate governance, values, ethics. Jan 17 - Better Banking program
launched with initiatives:
- Independent review of retail Banking remuneration and how we pay staff.
- Getting problems fixed
- Protecting whistle-blowers
- Stopping poor conduct, and review of code of Banking practise
✔✔What are other Finance service providers?
Authorised Deposit-Taking Institutions (ADI's) - ✔✔Building Societies:
Credit Unions:
✔✔What is a Building Society? - ✔✔A mutual institution, which means that most people
who have a savings account, or mortgage are members. Each building society and are
responsible for setting its strategy.
- Owner by and for the members
- Limit on proportion of their funds that building societies can raise from wholesale
money market
- Reinvest surplus revenue into the business to provide new products and services.
✔✔What is a credit union? - ✔✔a non-profit-making money cooperative whose
members can borrow from pooled deposits at low interest rates.
✔✔What are non-ADI's financial intermediaries? - ✔✔- Money Markets Corporations
- Finance Companies
- Securitisation Vehicles
✔✔What are the 4 types of financial markets - ✔✔1. Primary Markets
2. Secondary Market
3. Exchange Traded Markets
4. Over the counter markets
✔✔What is the Interest rate or Debt market. - ✔✔Trading (Buying and Selling) includes
shart term securities and long term securities such as government and corporate bonds.
✔✔What is the Foreign Exchange Market? - ✔✔Exchanging one currency for another.
Largest financial market in the World and 24 hours a day.
✔✔Trading shared in listed companies - ✔✔What is the equities market?
✔✔What is the Commodities Market? - ✔✔Trading in raw or primary products such as
wheat, grain, cattle., or electricity.
,✔✔What is the Derivatives Market? - ✔✔A contract whose value is derived from one or
more underlining assets or instruments; for example, forward rate agreements or
underlying exchange rates.
✔✔What is microeconomics? - ✔✔the study of how households and firms make
decisions and how they interact in markets. Supply and demand that impact the price
levels in the economy. Taxes and Regulation created by governments.
✔✔What is macroeconomics? - ✔✔The study of the economy as a whole
- Unemployment rates
- Gross Domestic Product - GDP
- Inflation
- Export and Imports
✔✔What are the Australian Economy Facts and Figures - ✔✔14th Largest economy
measured by GDP 1.99 Trillon - 2019
- Australian Labour force 12.3 millions June 2020
- Low levels of inflation 2% July 2020
- Unemployment rate 7%
✔✔What is Fiscal Policy? - ✔✔Government spending and taxation that influences the
economy.
✔✔What is the Monetary Policy - ✔✔RBA is responsible for Australians monetary policy
- aims to protect price stability full employment and economic prosperity.
✔✔What events occurred in 1980's in the Banking Industry? - ✔✔Government adopted
the four pillars policy. Announced it would reject any mergers between the Big 4 Banks.
- NAB
- CBA
- Westpac
- ANZ
✔✔What is the role of the Bank? - ✔✔1. Act as a financial intermediary between savers
& borrowers.
2. Contributes to the development of the economy
✔✔What is financial intermediation? - ✔✔The process of pooling funds from savers and
using these funds to provide loans to borrowers. The Bank acts as a go between, or
intermediary for those who have extra money and those who want to borrow.
✔✔What are the 4 types of investment Banking? - ✔✔1. Debt Capital Markets
2. Equity Capital Markets
3. Private Placements
, 4. Mergers and Acquisitions
✔✔What is Debt Capital Markets? - ✔✔Where a large company may want to build a
factory and is looking to issue bond financing to finance its expansion, or if a
government wants to finance the building of an airport, highway, or other large
municipal project, it may issue bonds to raise capital.
✔✔What is Equity Capital Markets? - ✔✔Where a company needs more money to grow
and decides to raise the funds by undertaking an initial public offering (IPO) whereby it
sells its shares to the public and a wider pool of investors for the first time.
✔✔What is Private Placements? - ✔✔Where customers place an offering of bonds with
an institutional investor such as an insurance company or a retirement fund. Often this
can be a fast-track option due to lower regulatory requirements.
✔✔What is Mergers and Acquisitions? - ✔✔Where a company is looking to buy another
company, investment banks offer advice on how the company should proceed with the
acquisition, including the pricing of the offer.
✔✔What is a Key Risk for Investment Bankers? - ✔✔Conflicts of interest - can occur
when investment bankers, who have access to confidential information from clients
related to their business and prospects, can pass information to their firm's traders.
Investment banks need to establish barriers known as 'Chinese walls', or information
barriers, within the organisation to prevent exchanges or communication that could lead
to conflicts of interest.
✔✔What are the main differences between commercial banking and investment
banking? - ✔✔Commercial banks tend to serve clients ranging from individuals, small to
medium size businesses up to large corporate clients, other financial institutions, public
agencies and governments.
Investment banks tend to serve a diversified client base which can include corporations,
financial institutions, governments and, in some cases, high net worth individuals.
✔✔How do Banks source their funds? - ✔✔Accepting Deposits:
Fixed term deposits (Lump sum deposited for Specific period
Current Deposits (Business Accounts)
Saving Deposits (From salary and wag earners)
✔✔What are the type of Bank Loans and Advances? - ✔✔Overdraft
Credit Card
Short Term Loan - 12 months
Medium Term Loan - 5yrs
Loan Term Loan - 30yrs
Bills of exchange and promissory notes
Equipment leasing and hire purchase
ANSWERS RATED A+
✔✔What events occurred in 2000-2017 in the Banking Industry? - ✔✔Renewed
emphasis on corporate governance, values, ethics. Jan 17 - Better Banking program
launched with initiatives:
- Independent review of retail Banking remuneration and how we pay staff.
- Getting problems fixed
- Protecting whistle-blowers
- Stopping poor conduct, and review of code of Banking practise
✔✔What are other Finance service providers?
Authorised Deposit-Taking Institutions (ADI's) - ✔✔Building Societies:
Credit Unions:
✔✔What is a Building Society? - ✔✔A mutual institution, which means that most people
who have a savings account, or mortgage are members. Each building society and are
responsible for setting its strategy.
- Owner by and for the members
- Limit on proportion of their funds that building societies can raise from wholesale
money market
- Reinvest surplus revenue into the business to provide new products and services.
✔✔What is a credit union? - ✔✔a non-profit-making money cooperative whose
members can borrow from pooled deposits at low interest rates.
✔✔What are non-ADI's financial intermediaries? - ✔✔- Money Markets Corporations
- Finance Companies
- Securitisation Vehicles
✔✔What are the 4 types of financial markets - ✔✔1. Primary Markets
2. Secondary Market
3. Exchange Traded Markets
4. Over the counter markets
✔✔What is the Interest rate or Debt market. - ✔✔Trading (Buying and Selling) includes
shart term securities and long term securities such as government and corporate bonds.
✔✔What is the Foreign Exchange Market? - ✔✔Exchanging one currency for another.
Largest financial market in the World and 24 hours a day.
✔✔Trading shared in listed companies - ✔✔What is the equities market?
✔✔What is the Commodities Market? - ✔✔Trading in raw or primary products such as
wheat, grain, cattle., or electricity.
,✔✔What is the Derivatives Market? - ✔✔A contract whose value is derived from one or
more underlining assets or instruments; for example, forward rate agreements or
underlying exchange rates.
✔✔What is microeconomics? - ✔✔the study of how households and firms make
decisions and how they interact in markets. Supply and demand that impact the price
levels in the economy. Taxes and Regulation created by governments.
✔✔What is macroeconomics? - ✔✔The study of the economy as a whole
- Unemployment rates
- Gross Domestic Product - GDP
- Inflation
- Export and Imports
✔✔What are the Australian Economy Facts and Figures - ✔✔14th Largest economy
measured by GDP 1.99 Trillon - 2019
- Australian Labour force 12.3 millions June 2020
- Low levels of inflation 2% July 2020
- Unemployment rate 7%
✔✔What is Fiscal Policy? - ✔✔Government spending and taxation that influences the
economy.
✔✔What is the Monetary Policy - ✔✔RBA is responsible for Australians monetary policy
- aims to protect price stability full employment and economic prosperity.
✔✔What events occurred in 1980's in the Banking Industry? - ✔✔Government adopted
the four pillars policy. Announced it would reject any mergers between the Big 4 Banks.
- NAB
- CBA
- Westpac
- ANZ
✔✔What is the role of the Bank? - ✔✔1. Act as a financial intermediary between savers
& borrowers.
2. Contributes to the development of the economy
✔✔What is financial intermediation? - ✔✔The process of pooling funds from savers and
using these funds to provide loans to borrowers. The Bank acts as a go between, or
intermediary for those who have extra money and those who want to borrow.
✔✔What are the 4 types of investment Banking? - ✔✔1. Debt Capital Markets
2. Equity Capital Markets
3. Private Placements
, 4. Mergers and Acquisitions
✔✔What is Debt Capital Markets? - ✔✔Where a large company may want to build a
factory and is looking to issue bond financing to finance its expansion, or if a
government wants to finance the building of an airport, highway, or other large
municipal project, it may issue bonds to raise capital.
✔✔What is Equity Capital Markets? - ✔✔Where a company needs more money to grow
and decides to raise the funds by undertaking an initial public offering (IPO) whereby it
sells its shares to the public and a wider pool of investors for the first time.
✔✔What is Private Placements? - ✔✔Where customers place an offering of bonds with
an institutional investor such as an insurance company or a retirement fund. Often this
can be a fast-track option due to lower regulatory requirements.
✔✔What is Mergers and Acquisitions? - ✔✔Where a company is looking to buy another
company, investment banks offer advice on how the company should proceed with the
acquisition, including the pricing of the offer.
✔✔What is a Key Risk for Investment Bankers? - ✔✔Conflicts of interest - can occur
when investment bankers, who have access to confidential information from clients
related to their business and prospects, can pass information to their firm's traders.
Investment banks need to establish barriers known as 'Chinese walls', or information
barriers, within the organisation to prevent exchanges or communication that could lead
to conflicts of interest.
✔✔What are the main differences between commercial banking and investment
banking? - ✔✔Commercial banks tend to serve clients ranging from individuals, small to
medium size businesses up to large corporate clients, other financial institutions, public
agencies and governments.
Investment banks tend to serve a diversified client base which can include corporations,
financial institutions, governments and, in some cases, high net worth individuals.
✔✔How do Banks source their funds? - ✔✔Accepting Deposits:
Fixed term deposits (Lump sum deposited for Specific period
Current Deposits (Business Accounts)
Saving Deposits (From salary and wag earners)
✔✔What are the type of Bank Loans and Advances? - ✔✔Overdraft
Credit Card
Short Term Loan - 12 months
Medium Term Loan - 5yrs
Loan Term Loan - 30yrs
Bills of exchange and promissory notes
Equipment leasing and hire purchase
