Preview Questions Credit Analyst | Role Specific Skill

Question 1: Which of the following profitability ratios is most useful for evaluating a company's ability to generate profit relative to revenue?

Which action should you take?

Choose only one option

Return on Assets (ROA)

Operating Profit Margin

Net Profit Margin

Return on Equity (ROE)

Question 2: What is the significance of tracking credit spreads in market research for BFSI?

Which action should you take?

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Evaluates borrower solvency

Predicts default probability

Indicates sector-wide risk sentiment

Measures liquidity premiums

Question 3: What does a high credit rating indicate in terms of credit risk?

Which action should you take?

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High interest rate risk

High exposure to market volatility

Low probability of default

High level of leverage

Question 4: How can credit scoring models assist in debt collection?

Which action should you take?

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Reduce recovery costs

Improve recovery prioritization

Accelerate payment processing

Ensure legal compliance

Question 5: How do you interpret "Loan Structure" in a borrower's application, and how do the terms of the loan (e.g., interest rates, repayment schedules) affect your credit assessment?

Which action should you take?

Choose only one option

I evaluate the loan structure to determine the impact of terms on the borrower's ability to repay, focusing on interest rates, maturity, and repayment schedules

I assume that more flexible loan terms always reduce the risk of default

I ignore the loan structure and focus only on the borrower's financials

I treat all loan structures equally, regardless of terms

Question 6: What is the "right-party contact rate" in collections?

Which action should you take?

Choose only one option

Contacting the legal guarantor

Contacting a co-borrower

Contacting via authorized channels

Contacting the borrower directly