Question 1

__________________________ risk is one that deals with the quality of the bank's assets and,in particular,the bank's loans.

Accepted Answer

Credit

Question 2

__________________________ measures the amount of debt or leverage a bank has and is one part of the evaluation of the bank's ROE.It is generally a number larger than one.

Accepted Answer

Equity multiplier

Question 3

The __________________________ is a standardized report provided by federal regulators which reports the balance sheet,income statement,and other data for all federally supervised banks.It also contains information on peer institutions.

Accepted Answer

Uniform Bank Performance Report

Question 4

________________________ is one of the most widely respected private institutions that rates the credit quality of financial institutions.

Accepted Answer

The answer of ________________________ is one of the most widely...

Question 5

__________________________ reflects the effectiveness of the expense management of a bank and is one of the principal components of evaluating ROE.

Accepted Answer

The answer of __________________________ reflects the effectiveness of the expense...

Question 6

__________________________ assets of a financial institution are those that will mature or be repriced within a set period of time.

Accepted Answer

The answer of __________________________ assets of a financial institution are...

Question 7

__________________________ measures the return to stockholders on their investment in a bank.It is the product of net profit margin,asset utilization,and the equity multiplier.

Accepted Answer

The answer of __________________________ measures the return to stockholders on...

Question 8

__________________________ assets,including loans,are those which are past due by 90 days or more.

Accepted Answer

The answer of __________________________ assets,including loans,are those which are past...

Question 9

A phenomenon wherein interest rates and security prices in the financial marketplace move against a troubled firm,forcing it to make crucial adjustments in policies and performance in order to calm investors' worst fears is often referred to as __________________ by economists.

Accepted Answer

The answer of A phenomenon wherein interest rates and security...

Question 10

The cumulative impact of all the risks (market risk,credit risk,operational risk,and legal and compliance risk)put together that can affect a financial firm's long-run survival is often referred to as _________________________.

Accepted Answer

The answer of The cumulative impact of all the risks...

Question 11

The ____________________ Act restricts combined auditing and consulting relationships in order to promote auditor independence and objectivity.

Accepted Answer

The answer of The ____________________ Act restricts combined auditing and...

Question 12

__________________________ is the risk that a financial institution may not be able to meet the needs for cash of its depositors.

Accepted Answer

The answer of __________________________ is the risk that a financial...

Question 13

________________________ includes violations of rules and regulations.It can include failure to hold adequate capital which can lead to costly corrective actions.

Accepted Answer

The answer of ________________________ includes violations of rules and regulations.It...

Question 14

The equity multiplier measures the amount of _____________________ for a bank and is one principal component of the bank's ROE.

Accepted Answer

The answer of The equity multiplier measures the amount of...

Question 15

__________________________ is the risk that the value of the financial institution's asset portfolio will decline due to falling market prices.

Accepted Answer

The answer of __________________________ is the risk that the value...

Question 16

One of the principal components of evaluating ROE is _____________________ ratio,which reflects a bank's portfolio management policies and the mix and yield on its assets.

Accepted Answer

The answer of One of the principal components of evaluating...

Question 17

________________________ refers to the uncertainty regarding a financial firm's earnings due to failures in computer systems,errors,misconduct by employees,lightning strikes,and similar events.

Accepted Answer

The answer of ________________________ refers to the uncertainty regarding a...

Question 18

__________________________ is the risk that shifting interest rates in the market will adversely affect a financial institution's net income or the value of its assets or equity.

Accepted Answer

The answer of __________________________ is the risk that shifting interest...

Question 19

________________________ refers to variability in earnings resulting from actions taken by the legal system including unenforceable contracts,lawsuits,and adverse judgements.

Accepted Answer

The answer of ________________________ refers to variability in earnings resulting...

Question 20

For a bank,sources of funds like Eurodollars,Fed funds,repurchase agreements,and large CDs are categorized as ____________________.

Accepted Answer

The answer of For a bank,sources of funds like Eurodollars,Fed...

Quiz 6: Measuring and Evaluating the Performance of Banks and Their Principal Competitors