South Carolina Credit Union Manager
Certification License Exam Practice
Questions And Correct Answers
(Verified Answers) Plus Rationale 2026
Q&A| Instant Download Pdf
1. Which federal law requires financial institutions to develop,
implement, and maintain an effective written anti-money laundering
(AML) program?
A. Bank Secrecy Act
B. USA PATRIOT Act
C. Truth in Lending Act
D. Fair Credit Reporting Act
The USA PATRIOT Act expanded AML requirements for financial
institutions, mandating comprehensive programs to detect and
prevent money laundering and terrorist financing.
2. Under the South Carolina Code of Laws governing credit unions, what
is the maximum percentage of a credit union’s net worth that may be
paid as a single dividend to its board of directors?
A. 10%
B. 0%
C. 2.5%
D. 5%
State law prohibits payment of dividends to directors, officers, or
, employees beyond normal member dividends to prevent conflicts of
interest and preserve net worth.
3. What document establishes the fundamental powers and limitations
of a South Carolina credit union?
A. Bylaws
B. Operating Policy Manual
C. Charter
D. Shareholder Agreement
The charter granted by the state defines the credit union’s authority
and scope of operations, serving as its foundational legal document.
4. Which ratio measures the adequacy of a credit union’s capital
relative to its assets?
A. Loan-to-Savings Ratio
B. Net Worth Ratio
C. Return on Assets
D. Liquidity Coverage Ratio
The net worth ratio (net worth divided by total assets) assesses a
credit union’s financial strength and ability to withstand losses.
5. Under Regulation Z, which of the following must be disclosed in a
consumer closed-end mortgage loan estimate?
A. Annual percentage yield
B. Maximum overdraft fees
C. Annual Percentage Rate (APR)
D. Variable dividend rate
Regulation Z requires disclosure of the APR so consumers can
compare the cost of credit consistently across lenders.
6. What is the primary purpose of the Credit Union Membership Access
Act (CUMAA)?
A. To allow mergers between banks and credit unions
, B. To clarify and preserve credit union field of membership rules
C. To establish uniform federal tax treatment
D. To limit dividends for credit unions
CUMAA was enacted to define and protect permissible fields of
membership, allowing credit unions to serve expanded common
bonds.
7. Which South Carolina regulatory body has primary oversight of
state-chartered credit unions?
A. Federal Reserve Board
B. National Credit Union Administration
C. South Carolina State Board of Financial Institutions
D. Consumer Financial Protection Bureau
State-chartered credit unions in South Carolina are regulated by the
State Board of Financial Institutions under state law.
8. What internal control function is responsible for the independent
review of a credit union’s audit programs?
A. Chief Financial Officer
B. Board of Directors
C. Internal Audit Department
D. Loan Committee
The internal audit department provides independent assessment of
controls, risk management, and compliance processes.
9. Under the Truth in Savings Act (Regulation DD), how must interest be
disclosed on savings accounts?
A. As a flat monthly amount
B. As Annual Percentage Yield (APY)
C. As annual simple interest only
D. Only upon request
Certification License Exam Practice
Questions And Correct Answers
(Verified Answers) Plus Rationale 2026
Q&A| Instant Download Pdf
1. Which federal law requires financial institutions to develop,
implement, and maintain an effective written anti-money laundering
(AML) program?
A. Bank Secrecy Act
B. USA PATRIOT Act
C. Truth in Lending Act
D. Fair Credit Reporting Act
The USA PATRIOT Act expanded AML requirements for financial
institutions, mandating comprehensive programs to detect and
prevent money laundering and terrorist financing.
2. Under the South Carolina Code of Laws governing credit unions, what
is the maximum percentage of a credit union’s net worth that may be
paid as a single dividend to its board of directors?
A. 10%
B. 0%
C. 2.5%
D. 5%
State law prohibits payment of dividends to directors, officers, or
, employees beyond normal member dividends to prevent conflicts of
interest and preserve net worth.
3. What document establishes the fundamental powers and limitations
of a South Carolina credit union?
A. Bylaws
B. Operating Policy Manual
C. Charter
D. Shareholder Agreement
The charter granted by the state defines the credit union’s authority
and scope of operations, serving as its foundational legal document.
4. Which ratio measures the adequacy of a credit union’s capital
relative to its assets?
A. Loan-to-Savings Ratio
B. Net Worth Ratio
C. Return on Assets
D. Liquidity Coverage Ratio
The net worth ratio (net worth divided by total assets) assesses a
credit union’s financial strength and ability to withstand losses.
5. Under Regulation Z, which of the following must be disclosed in a
consumer closed-end mortgage loan estimate?
A. Annual percentage yield
B. Maximum overdraft fees
C. Annual Percentage Rate (APR)
D. Variable dividend rate
Regulation Z requires disclosure of the APR so consumers can
compare the cost of credit consistently across lenders.
6. What is the primary purpose of the Credit Union Membership Access
Act (CUMAA)?
A. To allow mergers between banks and credit unions
, B. To clarify and preserve credit union field of membership rules
C. To establish uniform federal tax treatment
D. To limit dividends for credit unions
CUMAA was enacted to define and protect permissible fields of
membership, allowing credit unions to serve expanded common
bonds.
7. Which South Carolina regulatory body has primary oversight of
state-chartered credit unions?
A. Federal Reserve Board
B. National Credit Union Administration
C. South Carolina State Board of Financial Institutions
D. Consumer Financial Protection Bureau
State-chartered credit unions in South Carolina are regulated by the
State Board of Financial Institutions under state law.
8. What internal control function is responsible for the independent
review of a credit union’s audit programs?
A. Chief Financial Officer
B. Board of Directors
C. Internal Audit Department
D. Loan Committee
The internal audit department provides independent assessment of
controls, risk management, and compliance processes.
9. Under the Truth in Savings Act (Regulation DD), how must interest be
disclosed on savings accounts?
A. As a flat monthly amount
B. As Annual Percentage Yield (APY)
C. As annual simple interest only
D. Only upon request
