Preview Questions Risk Manager | Role Specific Skill

Question 1: How should risk appetite be integrated into strategic planning?

Which action should you take?

Choose only one option

Ignore risk appetite in strategic plans

Focus solely on historical loss data

Define limits by business units

Establish risk-adjusted KPIs

Question 2: To mitigate credit risk in a lending portfolio, which of the following actions is most effective?

Which action should you take?

Choose only one option

Increasing exposure to high-risk borrowers

Reducing the number of credit checks

Diversifying the loan book across multiple sectors

Increasing loan-to-value ratios

Question 3: Risk-adjusted return in financial risk analysis can be best measured by which of the following?

Which action should you take?

Choose only one option

Price-to-book ratio

Dividend yield

Sharpe ratio

Debt-to-equity ratio

Question 4: In financial risk analysis, what does a high correlation coefficient between two assets indicate?

Which action should you take?

Choose only one option

They are highly uncorrelated and will provide effective diversification

Their returns are independent of each other

They are highly correlated, meaning their returns move in the same direction

The risk of the portfolio will be minimized

Question 5: What does the term "know your customer" (KYC) primarily relate to in compliance management?

Which action should you take?

Choose only one option

Ensuring customer data privacy

Providing customers with loan products

Identifying and verifying customers' identity

Offering financial planning services to customers

Question 6: How would you assess the long-term sustainability of a financial institution when creating a strategic plan?

Which action should you take?

Choose only one option

By reviewing its investment in new technologies

By measuring the strength of its brand in emerging markets

By evaluating its current liquidity position

By conducting a comprehensive environmental risk assessment