What is the primary objective of risk management in commercial banks?

Chapter 5

Quiz
•
Financial Education
•
12th Grade
•
Medium
Hằng Nguyễn
Used 1+ times
FREE Resource
78 questions
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1.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
Maximizing shareholder wealth while limiting excessive risk
Eliminating all forms of financial risk
Ensuring zero defaults in the loan portfolio
Achieving the highest market share
2.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
Which of the following is NOT a step in the risk-return assessment suggested by Hempel and Simonson?
Analyze historical performance trends
Evaluate risk-return decisions of competitors
Establish realistic objectives based on internal opinions
Contrast the bank's performance with peer institutions
3.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
Credit risk primarily arises from:
Changes in market interest rates
Borrowers failing to meet agreed terms
Fluctuations in foreign exchange rates
Operational inefficiencies in banks
4.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
What is the role of credit scoring in loan evaluation?
To assign loans without collateral
To assess a borrower’s creditworthiness using predictive models
To ensure loans are diversified geographically
To measure the liquidity needs of borrowers
5.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
Liquidity risk refers to:
Losses from changes in market prices
The potential inability to meet short-term obligations
Borrowers failing to repay loans
Disruptions due to operational failures
6.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
What is a common measure to monitor liquidity risk?
Loan-to-value ratio
Short-term securities to total deposits ratio
Debt-to-equity ratio
Net interest margin
7.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
Operational risk includes:
Failures in technology or internal processes
Changes in foreign exchange rates
Variability in interest rates
Customer default on loans
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