Exam 2: Commercial Banks

A bank provides documentary letters of credit for a company that has a credit rating of A+.The face value of contracts outstanding is $2 million.Calculate the dollar value of capital required under the capital adequacy requirements to support these facilities,given that the bank supervisor's credit conversion factor is 20%.

Which of the following is a bank liability?

Which of the following regarding certificates of deposit (CDs)is correct?

With regard to bank bills,the bill is sold at a discount:

If you take out a mortgage from a bank,the mortgage is a/an:

Which of the following statements about direct credit substitutes provided by a commercial bank is incorrect?

The assets on a bank's balance sheet are:

Which of the following about a bank's activities is incorrect?

Under Basel II prudential standards,an institution is required to maintain a risk-based capital ratio of _____ of total-risk-weighted assets.

An example of an 'off-sheet business' transaction that banks are generally involved in is:

The term 'negotiable' in relation to a security means:

Discuss the main features of housing finance.

Which of the following is NOT an argument for some form of government regulation of the banking system?

Which of the following statements concerning banks is incorrect?

Under Pillar 1 of the Basel II framework,the risk weight for a residential housing loan is determined by the:

Which of the following institutions are supervised by APRA?

As a depositor shifts funds from current deposits to term deposits in a bank,generally the depositor's:

Each of the following balance sheet portfolio items are liabilities of a bank,except:

The market structure of the banking sector has changed since deregulation of the financial system during the 1980s.Which statement most closely reflects the current structure of the banking sector in Australia?

Which of the following statements about market-rate-related items such as forward-rate agreements is incorrect?