FI 412 Exam 4
Study online at https://quizlet.com/_hycm3u
1. B: Which statement is true about shadow banking?
A. Face Significantly more regulation than traditional banks
B. Can often perform credit intermediation process more cost efficiently than traditional banks
2. Correspondent banking: The provision of banking services to other banks that do not have the staff
resources to perform themselves is called what?
3. Federal Deposit Insurance Corporation (FDIC): Which commercial bank regulator acts as a
receiver and liquidator when insured bank is closed?
4. : Which statement is true about commercial banks?
A. Commercial banks are the largest group of FIs in terms of the dollar value of assets
B. Major assets are loans and major liabilities are deposits
5. Credit (default) risk, liquidity risk, interest rate risk, and Insolvency Risk: What
are the risks commercial banks face because of their asset structure?
6. Both: Which is true about the structure of banks' balance sheets?
A. More liquid instruments, such as deposits, are used to fund less liquid assets, such as loans
B. Major exposure concerns for bank managers are maturity mismatch and interest rate risk
7. Office of the Comptroller of the Currency (OCC): Which commercial bank regulator charter
and close national banks?
8. Financial Services Modernization Act (1999): Since 1987 banks were permitted to underwrite
corporate securities. Which government program or law also gave banks full authority to enter the investment banking
(and insurance) business?
9. All of the above: Which is a non deposit liability of commercial banks?
A. Shorter maturity Instruments
B. Purchase of federal funds (bank reserves) on the interbank market
C. Repurchase agreements (temporary swaps of securities for federal funds)
10. : Which statement is false?
11. : What does commercial bank equity capital mainly consist of?
1/7
, FI 412 Exam 4
Study online at https://quizlet.com/_hycm3u
12. : Why banks are regulated?
13. : What services, which are essential to the financial markets, do commercial banks perform?
14. : Which is true about commercial banks?
A. Trust services are offered by both large and small banks
B. Pension fund assets are the largest group of assets managed by trust departments of commercial banks
15. : Which is not a fee-related off-balance-sheet activity of commercial banks?
16. : Which major subcategory of bank's assets consists of items such as trading assets, premises and fixed assets,
other real estate owned, intangible assets?
17. : Which CAMELS rating group include banks that have an immoderate volume of serious financial weaknesses or
a combination of other conditions that are unsatisfactory?
18. : Which major subcategory of bank's assets generate the largest flow of revenue income, includes least liquid asset
items and is a major source of credit and liquidity risk for most banks?
19. : Which statements are true:
A. Commercial banks must submit financial statements to regulators at the end of each fiscal year
B. Report of condition presents financial information on a bank's assets, liabilities, and equity capital
20. : Which statement is true?
A. Equity capital is a major subcategory of bank's liabilities that include stock, retained earnings, repurchase agreements,
and commercial paper
B. Borrowed funds are subcategory of bank's liabilities that include accrued interest, deferred taxes, dividends payable,
and banker's acceptances
21. : Which is NOT a measure that regulators use to asses sensitivity to market risk of commercial banks?
22. : Which is NOT a component of the rating system that regulators use to asses the safety and soundness of
commercial banks?
23. : Which is Not a measure that regulators use to assess earnings of commercial banks?
24. : Which CAMELS ratings group include banks that have an extremely high immediate or near-term probability of
failure?
2/7
Study online at https://quizlet.com/_hycm3u
1. B: Which statement is true about shadow banking?
A. Face Significantly more regulation than traditional banks
B. Can often perform credit intermediation process more cost efficiently than traditional banks
2. Correspondent banking: The provision of banking services to other banks that do not have the staff
resources to perform themselves is called what?
3. Federal Deposit Insurance Corporation (FDIC): Which commercial bank regulator acts as a
receiver and liquidator when insured bank is closed?
4. : Which statement is true about commercial banks?
A. Commercial banks are the largest group of FIs in terms of the dollar value of assets
B. Major assets are loans and major liabilities are deposits
5. Credit (default) risk, liquidity risk, interest rate risk, and Insolvency Risk: What
are the risks commercial banks face because of their asset structure?
6. Both: Which is true about the structure of banks' balance sheets?
A. More liquid instruments, such as deposits, are used to fund less liquid assets, such as loans
B. Major exposure concerns for bank managers are maturity mismatch and interest rate risk
7. Office of the Comptroller of the Currency (OCC): Which commercial bank regulator charter
and close national banks?
8. Financial Services Modernization Act (1999): Since 1987 banks were permitted to underwrite
corporate securities. Which government program or law also gave banks full authority to enter the investment banking
(and insurance) business?
9. All of the above: Which is a non deposit liability of commercial banks?
A. Shorter maturity Instruments
B. Purchase of federal funds (bank reserves) on the interbank market
C. Repurchase agreements (temporary swaps of securities for federal funds)
10. : Which statement is false?
11. : What does commercial bank equity capital mainly consist of?
1/7
, FI 412 Exam 4
Study online at https://quizlet.com/_hycm3u
12. : Why banks are regulated?
13. : What services, which are essential to the financial markets, do commercial banks perform?
14. : Which is true about commercial banks?
A. Trust services are offered by both large and small banks
B. Pension fund assets are the largest group of assets managed by trust departments of commercial banks
15. : Which is not a fee-related off-balance-sheet activity of commercial banks?
16. : Which major subcategory of bank's assets consists of items such as trading assets, premises and fixed assets,
other real estate owned, intangible assets?
17. : Which CAMELS rating group include banks that have an immoderate volume of serious financial weaknesses or
a combination of other conditions that are unsatisfactory?
18. : Which major subcategory of bank's assets generate the largest flow of revenue income, includes least liquid asset
items and is a major source of credit and liquidity risk for most banks?
19. : Which statements are true:
A. Commercial banks must submit financial statements to regulators at the end of each fiscal year
B. Report of condition presents financial information on a bank's assets, liabilities, and equity capital
20. : Which statement is true?
A. Equity capital is a major subcategory of bank's liabilities that include stock, retained earnings, repurchase agreements,
and commercial paper
B. Borrowed funds are subcategory of bank's liabilities that include accrued interest, deferred taxes, dividends payable,
and banker's acceptances
21. : Which is NOT a measure that regulators use to asses sensitivity to market risk of commercial banks?
22. : Which is NOT a component of the rating system that regulators use to asses the safety and soundness of
commercial banks?
23. : Which is Not a measure that regulators use to assess earnings of commercial banks?
24. : Which CAMELS ratings group include banks that have an extremely high immediate or near-term probability of
failure?
2/7
