GARP ICBRR Actual Free Exam Questions & Community Discussion
A bank has a large number of auto loans and would prefer to sell them to raise cash for more funding. However, selling individual auto loans is difficult. What could the bank do?
Correct Answer: D
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A customer of EtaBank, Alfred Fall, fell on the marble floors of the bank and sustained substantial injuries. Subsequently, he won a personal injury claim of $50,000 against EtaBank. How should EtaBank's operational loss data event information database categorize this event?
Correct Answer: C
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Which one of the following four statements about the relationship between exchange rates and option values is correct?
Correct Answer: D
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Gamma Bank provides a $100,000 loan to Big Bath retail stores at 5% interest rate (paid annually). The loan is collateralized with $55,000. The loan also has an annual expected default rate of 2%, and loss given default at 50%. In this case, what will the bank's expected loss be?
Correct Answer: B
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A bank customer expecting to pay its Brazilian supplier BRL 100 million asks Alpha Bank to buy Australian dollars and sell Brazilian reals. Alpha bank does not hold reals so it asks for a quote to buy Brazilian reals in the market. The market rate is 100. The bank quotes a selling rate of 101 to its customer and sells the reals at this quoted price. Then the bank immediately buys the real at the market rate and completes foreign exchange matched transaction. What is the financial impact of this transaction for Alpha bank?
Correct Answer: A
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Which of the following bank events could stress the bank's liquidity position?
I. Maturing of bank debt
II. Repurchase agreements
III. Futures margins
IV.
Staff turnover
I. Maturing of bank debt
II. Repurchase agreements
III. Futures margins
IV.
Staff turnover
Correct Answer: D
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Why do regulatory standards impose formulaic capital calculations for all of the banks activities?
I. If the banks use different models it is difficult for a regulator to compare results across banks.
II. By imposing standardized calculations regulators can make sure that banks are not missing key risks in their calculations.
III.
By imposing standardized calculations regulators can make sure that banks do not use capital calculations to game the banking regulation system.
I. If the banks use different models it is difficult for a regulator to compare results across banks.
II. By imposing standardized calculations regulators can make sure that banks are not missing key risks in their calculations.
III.
By imposing standardized calculations regulators can make sure that banks do not use capital calculations to game the banking regulation system.
Correct Answer: B
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Which one of the following four examples would not be considered a typical source of market risk?
Correct Answer: D
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What is the role of market risk management function within a bank?
I. Control and minimize the risks the bank should take.
II. Establish a comprehensive market risk policy framework.
III. Define, approve and monitor risk limits.
IV.
Perform stress tests and other qualitative risk assessments.
I. Control and minimize the risks the bank should take.
II. Establish a comprehensive market risk policy framework.
III. Define, approve and monitor risk limits.
IV.
Perform stress tests and other qualitative risk assessments.
Correct Answer: A
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