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MGMT FIN INST CH 13
Terms in this set (34)
The largest single loan category for all banks is:
real estate loans.
The highest ROA and charge-off rates in 2012 were reported by:
Credit Card Banks
Widespread use of credit scoring:
standardizes the perceived quality of different loan types.
The vast majority of FDIC-insured institutions are classified as:
To be classified as a non-current loan, payments must be past due a minimum of how many days?
The risk of potential loss of interest and principal on international loans due to borrowers in a country refusing to make timely payments, as per the loan agreement is known as what type of risk?
Large firms can obtain funds from which of the following?
a. Equity financing
b. Issuing commercial paper
c. Issuing long-term bonds
d. Loans from commercial banks
e. All of the above
When a bank lends in a narrow geographic area, they are subject to:
In the credit process, which of the following activities falls under Business Development and Credit Analysis?
Officer call programs
In the credit process, which of the following activities falls under Credit Review?
Review loan documentation
In the credit process, which of the following activities falls under Credit Execution and Administration?
Financial statement analysis
Which of the following formalizes a bank's lending guidelines?
Which of the following refers to the principles that drive a bank's lending activity?
Which of the following is the primary emphasis of a values-driven credit culture?
Bank soundness and stability
A security interest in a loan is said to be perfected if the:
bank holds the collateral.
Which of the following is not one of the five Cs of (good) credit?
The ability to repay a loan is measured by a firm's:
The lender's secondary source of repayment in case of default is:
Which of the following is not one of the five Cs of bad credit?
Which of the following refers to a lender's tendency to ignore circumstances in which a loan might default?
may limit discretionary cash outlays by firms.
When a bank's claim to collateral is superior to all other creditors, the claim is said to be:
Which of the following would be considered a "negative" loan covenant?
Cash dividends cannot exceed 50% of earnings.
Which of the following would be considered a "positive" loan covenant?
Days receivables outstanding cannot exceed 30 days
All of the following are loan classifications under the Uniform Bank Performance Report except:
Which of the following would be considered an interim loan?
Loans that finance the construction of roads and public utilities in new subdivisions are labeled:
land development loans.
Positive working capital for a firm implies:
that current assets are partially financed by long-term debt and equity.
A loan where the entire principal is due at maturity is called a:
_______________________ represents the amount of long-term financing required for current assets.
Permanent working capital
A _______________________ is a post office box number controlled by the bank.
Asset based loans:
include loans to finance leveraged buyouts
Banks rarely provide:
start-up capital loans.
Venture capital financing that comes in the "later rounds" of financing may take the form of:
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