Preview Questions Treasury Manager | Role Specific Skill

Question 1: In managing credit risk, which strategy is typically employed to limit exposure to individual borrowers?

Which action should you take?

Choose only one option

Setting exposure limits and diversifying credit portfolios

Concentrating investments in high-risk assets for greater returns

Using leverage to amplify returns

Offering flexible terms to high-risk borrowers

Question 2: What is the primary goal of a cash management system in treasury operations?

Which action should you take?

Choose only one option

To track the company's stock market performance

To manage the company's debt portfolio

To monitor credit risk exposure

To ensure that the company has sufficient cash flow to meet its obligations

Question 3: What is the main objective of using a portfolio insurance strategy?

Which action should you take?

Choose only one option

To increase the overall portfolio return

To hedge against interest rate movements

To diversify the portfolio's assets

To protect the portfolio from significant downside risk

Question 4: Which financial metric is used by Treasury Managers to evaluate the liquidity position in the balance sheet?

Which action should you take?

Choose only one option

Current ratio

Debt-to-equity ratio

Return on equity

Earnings before interest and taxes (EBIT)

Question 5: What is the effect of inflation on the real return of investments in an investment portfolio managed by a Treasury Manager?

Which action should you take?

Choose only one option

It has no effect on the real return of the portfolio

It reduces the real return of fixed income investments

It increases returns from equity investments

It affects short-term speculative investments the most

Question 6: In treasury operations, how would you structure a hedging program to mitigate FX risks for a multinational bank?

Which action should you take?

Choose only one option

By limiting foreign exposure to high-volatile currencies

By using a combination of forwards, options, and swaps

By relying on a single foreign currency basket

By focusing solely on futures contracts