Microfinance Risk Management Principles

Microfinance Risk Management Principles

Assessment

Flashcard

Business

University

Hard

Created by

monette elba

Used 1+ times

FREE Resource

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12 questions

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1.

FLASHCARD QUESTION

Front

What is the main concern in microfinance according to Principle 13?

Back

Risk is a major concern in microfinance.

2.

FLASHCARD QUESTION

Front

What must supervisors ensure regarding banks and market risks?

Back

Supervisors must ensure that banks have policies and processes to identify, measure, monitor, and control market risks.

3.

FLASHCARD QUESTION

Front

What is a significant challenge for ODTIs regarding market risk?

Back

Managing the currency mismatch between microloans in local currency and funding in foreign currency.

4.

FLASHCARD QUESTION

Front

What should regulators do to manage foreign currency risk for ODTIs?

Back

Regulators should restrict an institution’s net open position by establishing limits in relation to capital and/or earnings impact.

5.

FLASHCARD QUESTION

Front

What is required from ODTIs in terms of liquidity management according to Principle 14?

Back

ODTIs must have a liquidity management strategy that identifies, measures, monitors, and controls liquidity risk.

6.

FLASHCARD QUESTION

Front

What unique features should be considered in liquidity risk management for microfinance?

Back

The specific dynamics of microfinance assets and liabilities.

7.

FLASHCARD QUESTION

Front

What should ODTI liquidity plans include according to Principle 14?

Back

Simple stress scenarios taking into account contagion effects.

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