#1
Which of the following is a common financial risk faced by banks?
Market risk
Operational risk
Credit risk
All of the above
#2
What is the primary purpose of financial risk management in banking?
To eliminate all risks
To minimize the impact of risks
To increase profitability
To maximize shareholder wealth
#3
Which of the following is NOT a type of market risk faced by banks?
Interest rate risk
Foreign exchange risk
Credit risk
Liquidity risk
#4
What is the purpose of stress testing in financial risk management?
To measure the bank's ability to withstand adverse economic conditions
To forecast future interest rates
To identify profitable investment opportunities
To assess customer satisfaction
#5
What is the main objective of liquidity risk management in banking?
To maximize shareholder wealth
To minimize credit risk
To ensure sufficient funds are available to meet obligations
To eliminate market risk
#6
Which of the following is NOT a factor contributing to operational risk in banking?
Fraudulent activities
Technological failures
Market volatility
Human error
#7
Which of the following is NOT a typical component of a bank's anti-money laundering program?
Customer due diligence
Transaction monitoring
Risk-taking
Suspicious activity reporting
#8
Which regulatory body is primarily responsible for overseeing anti-money laundering efforts in the United States?
SEC (Securities and Exchange Commission)
IRS (Internal Revenue Service)
FINRA (Financial Industry Regulatory Authority)
FATF (Financial Action Task Force)
#9
Which of the following is a key principle of an effective anti-money laundering program?
Transaction opacity
Enhanced due diligence
Anonymous reporting
Financial exclusion
#10
What is the role of a compliance officer in the context of anti-money laundering?
To facilitate money laundering activities
To develop money laundering strategies
To ensure adherence to anti-money laundering regulations
To provide financial advice to clients
#11
What is the purpose of a risk assessment in the context of anti-money laundering?
To identify potential money laundering activities
To increase customer anonymity
To bypass regulatory requirements
To maximize financial profits
#12
Which of the following is NOT a characteristic of a suspicious transaction?
Unusual size or frequency
Known legitimate source
Complexity of transaction
Lack of economic purpose
#13
Which of the following techniques is commonly used by money launderers to conceal the origin of illicit funds?
Structuring
Customer verification
KYC (Know Your Customer) procedures
Transaction recording
#14
Which of the following is a characteristic of the 'layering' stage in the money laundering process?
It involves converting cash into assets
It occurs before the placement stage
It focuses on concealing the source of funds
It involves the direct integration of funds into the financial system
#15
Which of the following is a primary method for banks to identify and verify customers for anti-money laundering purposes?
Random selection
Know Your Customer (KYC)
Customer exclusion
Anonymous transactions
#16
What is the primary function of a risk management committee in a bank?
To facilitate money laundering activities
To oversee the implementation of risk management policies and procedures
To provide financial advice to clients
To maximize shareholder wealth
#17
Which of the following is a common method for banks to mitigate operational risk?
Outsourcing critical functions
Reducing customer due diligence
Increasing leverage
Avoiding risk assessment