Which of the following best suits in place of question mark?
Answer(s): A
Interest rate risk arises from differences between the timing of rate changes and the timing of cash flows ( );from changing rate relationships among different yield curves affecting bank activities ( ); from changing rate relationship across the spectrum of maturities ( );and from internet-related options embedded in bank products ( ).Choose the appropriate set.
In a price risk situation if customers withdraw their applications a bank may be unable to originate enough loans to meet its forward sales commitments .Because of this kind of "Fallout" a bank may have to purchase additional loans in the secondary market at prices higher than anticipated. Alternatively, a bank may choose to liquidate its commitment to sell and deliver mortgages by paying a fee to the counterparty commonly called a .
Answer(s): B
Compliance risk can lead t[o all of the following situations EXCEPT:
Answer(s): D
Selectively increasing the price of a mortgages loan above the bank's established rate to certain customers ("overages") may have the effect of discriminating against those customers .This practice left undetected and not properly controlled may raise the possibility of:
Answer(s): C
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