THE BMZ ACADEMY
THE BMZ ACADEMY
053 8213
BMZ ACADEMY 061 262 1185/068 053 8213Page 1 of 17
, THE BMZ ACADEMY
IMPORTANT NOTES TO CONSIDER
THIS IS ONLY A FRAMEWORK, NO ONE SHOULD SUBMIT IT FOR FINAL
ASSESSMENT.
STUDENTS SHOULD COMPLETE THEIR OWN ASSIGNMENT, BUT KEEP IN MIND
THE RULES/INSTRUCTIONS
AS A TIP, IF YOU FIND THIS GUIDE USEFUL, YOU CAN CALL/WHATASPP US IF
YOU WANT A UNIQUE AND CUSTOMISED SOLUTION, SOMETHING THAT WE
GIVE YOU ALONE AND NOT SHARED WITH OTHER PEOPLE NOR SOLD ON
STUVIA AND OTHER ONLINE SITES
********************************************************************************************
AT BMZ Academy, WE WISH YOU THE BEST IN ALL YOUR STUDIES.
WE ARE YOUR MATES TO PASSING EXCELLENTLY IN ALL YOUR STUDIES.
DO NOT FORGET TO REACH OUT TO US FOR ANY FURTHER AND OTHER
ASSISTANCE!
GOOD LUCKY
BMZ ACADEMY 061 262 1185/068 053 8213
, THE BMZ ACADEMY
Table of Contents
QUESTION 1 ............................................................................................................. 5
1.1 Identification of Five Risks Applicable in the Standard Bank Case (10 Marks) .... 5
Legal and Regulatory Risk ...................................................................................... 5
Compliance Risk ..................................................................................................... 5
Operational Risk ..................................................................................................... 5
Money Laundering Risk .......................................................................................... 6
Reputational Risk.................................................................................................... 6
1.2 Steps That Can Be Taken to Mitigate the Risks Identified in This Case (5 Marks)
................................................................................................................................... 6
Strengthening Customer Due Diligence Processes ................................................ 7
Enhancing Regulatory Compliance Monitoring ....................................................... 7
Improving Internal Systems and Controls ............................................................... 7
Strengthening Record-Keeping Procedures ........................................................... 7
Promoting a Strong Compliance and Risk Culture ................................................. 7
QUESTION 2 ............................................................................................................. 8
2.1 Determination of the Expected Return and Standard Deviation of the Loan Portfolio
(11 Marks) .................................................................................................................. 8
Expected Portfolio Return ....................................................................................... 8
Portfolio Variance ................................................................................................... 9
= (0.252)(0.122) + (0.402)(0.142) + (0.352)(0.162) +2(0.25)(0.40)(0.04) +
2(0.25)(0.35)(0.03) + 2(0.40)(0.35)(0.02) = 0.0009 + 0.003136 + 0.003136 +
0.008 + 0.00525 + 0.0056 = 0.026022 Portfolio Standard Deviation ...................... 9
2.2 Significance of Correlation in Credit Portfolio Risk Management (1 Mark) ........... 9
QUESTION 3 ........................................................................................................... 10
Financial Ratio Analysis for Rheno Discount Supermarket (15 Marks) .................... 10
3.1 Current Ratio ...................................................................................................... 10
3.2 Days Accounts Payable Outstanding ................................................................. 10
BMZ ACADEMY 061 262 1185/068 053 8213
THE BMZ ACADEMY
053 8213
BMZ ACADEMY 061 262 1185/068 053 8213Page 1 of 17
, THE BMZ ACADEMY
IMPORTANT NOTES TO CONSIDER
THIS IS ONLY A FRAMEWORK, NO ONE SHOULD SUBMIT IT FOR FINAL
ASSESSMENT.
STUDENTS SHOULD COMPLETE THEIR OWN ASSIGNMENT, BUT KEEP IN MIND
THE RULES/INSTRUCTIONS
AS A TIP, IF YOU FIND THIS GUIDE USEFUL, YOU CAN CALL/WHATASPP US IF
YOU WANT A UNIQUE AND CUSTOMISED SOLUTION, SOMETHING THAT WE
GIVE YOU ALONE AND NOT SHARED WITH OTHER PEOPLE NOR SOLD ON
STUVIA AND OTHER ONLINE SITES
********************************************************************************************
AT BMZ Academy, WE WISH YOU THE BEST IN ALL YOUR STUDIES.
WE ARE YOUR MATES TO PASSING EXCELLENTLY IN ALL YOUR STUDIES.
DO NOT FORGET TO REACH OUT TO US FOR ANY FURTHER AND OTHER
ASSISTANCE!
GOOD LUCKY
BMZ ACADEMY 061 262 1185/068 053 8213
, THE BMZ ACADEMY
Table of Contents
QUESTION 1 ............................................................................................................. 5
1.1 Identification of Five Risks Applicable in the Standard Bank Case (10 Marks) .... 5
Legal and Regulatory Risk ...................................................................................... 5
Compliance Risk ..................................................................................................... 5
Operational Risk ..................................................................................................... 5
Money Laundering Risk .......................................................................................... 6
Reputational Risk.................................................................................................... 6
1.2 Steps That Can Be Taken to Mitigate the Risks Identified in This Case (5 Marks)
................................................................................................................................... 6
Strengthening Customer Due Diligence Processes ................................................ 7
Enhancing Regulatory Compliance Monitoring ....................................................... 7
Improving Internal Systems and Controls ............................................................... 7
Strengthening Record-Keeping Procedures ........................................................... 7
Promoting a Strong Compliance and Risk Culture ................................................. 7
QUESTION 2 ............................................................................................................. 8
2.1 Determination of the Expected Return and Standard Deviation of the Loan Portfolio
(11 Marks) .................................................................................................................. 8
Expected Portfolio Return ....................................................................................... 8
Portfolio Variance ................................................................................................... 9
= (0.252)(0.122) + (0.402)(0.142) + (0.352)(0.162) +2(0.25)(0.40)(0.04) +
2(0.25)(0.35)(0.03) + 2(0.40)(0.35)(0.02) = 0.0009 + 0.003136 + 0.003136 +
0.008 + 0.00525 + 0.0056 = 0.026022 Portfolio Standard Deviation ...................... 9
2.2 Significance of Correlation in Credit Portfolio Risk Management (1 Mark) ........... 9
QUESTION 3 ........................................................................................................... 10
Financial Ratio Analysis for Rheno Discount Supermarket (15 Marks) .................... 10
3.1 Current Ratio ...................................................................................................... 10
3.2 Days Accounts Payable Outstanding ................................................................. 10
BMZ ACADEMY 061 262 1185/068 053 8213
