Preview Questions Risk Manager | Role Specific Skill

Question 1: What does a high loan-to-deposit ratio suggest about a bank's financial position?

Which action should you take?

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High capital reserves

Strong liquidity

Low operational efficiency

Potential liquidity risk

Question 2: How does Macroeconomic stress impact financial analysis of a bank's performance?

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It directly affects the debt-to-equity ratio

It influences liquidity and asset quality

It improves the bank's profitability during periods of inflation

It increases market volatility in trading operations

Question 3: Which approach is typically used for modeling market risk under Basel II?

Which action should you take?

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Monte Carlo Simulation

Historical Simulation

Standardized Approach

VaR

Question 4: When designing a capital adequacy strategy to mitigate risk, which factor is most important for ensuring a bank's ability to absorb financial losses?

Which action should you take?

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Interest coverage ratio

Leverage ratio

Minimum capital requirement

Loan-to-value ratio

Question 5: Which strategy is most effective in mitigating market risk for a diversified investment portfolio?

Which action should you take?

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Reducing exposure to high-risk sectors

Increasing portfolio liquidity

Concentrating on a few high-performing assets

Using hedging techniques such as derivatives

Question 6: In risk management, which of the following is the most accurate measure of risk for a portfolio with multiple assets?

Which action should you take?

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Correlation matrix

Sharpe ratio

Beta coefficient

Standard deviation of returns