Preview Questions Credit Analyst | Role Specific Skill

Question 1: What is the impact of significant off-balance-sheet financing on financial ratios?

Which action should you take?

Choose only one option

Reduces tax liability

Understates liabilities

Overstates profitability

Inflates equity

Question 2: What is the benefit of adding covenants to a loan structure?

Which action should you take?

Choose only one option

Mitigate lender risk

Increase loan flexibility

Increase interest rates

Simplify documentation

Question 3: How can an analyst assess the impact of international trade policies on a domestic industry's creditworthiness?

Which action should you take?

Choose only one option

By evaluating the impact of tariffs and global market access

By measuring changes in consumer spending behavior

By comparing domestic companies to global competitors

By assessing changes in currency exchange rates

Question 4: In a loan structure, how does an amortizing schedule affect cash flow risk for the borrower?

Which action should you take?

Choose only one option

Decreases periodic payment risk

Increases payment predictability

Mitigates interest rate volatility

Reduces overall loan cost

Question 5: Which KPI is crucial for evaluating third-party collection agencies?

Which action should you take?

Choose only one option

Recovery ratio

Customer complaints ratio

Time to recover

Cost per recovery

Question 6: Why is monitoring the yield curve critical in market research for BFSI?

Which action should you take?

Choose only one option

Determines market share

Indicates sector liquidity

Predicts interest rate trends

Evaluates pricing power