Free Practice Questions for ACI 3I0-012 Exam

The leverage ratio is the ratio of the bank’s Tier 1 Capital to total assets of the bank, excluding its off- balance sheet exposures and derivatives.

The purpose of introducing a leverage ratio is to avoid the build-up of excess leverage that could potentially lead to a “credit crunch” in stressed conditions.

The leverage ratio under Basel III must be higher than 4%.

The leverage ratio is the ratio of the bank’s Tier 1 and Tier 2 Capital to total assets of the bank, including its off-balance sheet exposures and derivatives.

that all telephone conversations (internal and external) be taped without informing counterparties

that only conversations undertaken by dealers and brokers should be recorded

that all conversations undertaken by dealers and brokers should be recorded, together with back office telephone lines used by those responsible for confirming deals or passing payments to other institutions

that only telephone conversations between dealers and brokers be recorded

1.32%

1.29%

1.28%

0.65%

1.4494

1.4499

1.4504

1.4586

XAU

XAG

XPT

XPD

A short call option + long put option with a higher strike price than the call option

A long call option + long put option with a lower strike price than the call option

A short call option + short put option with a lower strike price than the call option

A long call option + long put option with higher strike price than the call option

The expense of settling an FRA

The reduced counterparty risk on a futures exchange

The reduced basis risk on futures

The superior interest rate risk on FRAs

Liquidity providers should be cognizant of reputational risks when supplying liquidity for onward third party consumption.

Market participants must not seek information as to the legal status of a potential counterparty before allocating credit or trading status.

Transactions should be handled in accordance with the regulator’s dealing rule book.

Access to systems internally and at the client interface must be strictly controlled by the dealers.

You are, as it is your responsibility to check periodically that the price has not been dealt upon.

The broker is, as he must immediately tell you that your price has been dealt upon.

The other bank is, since it did not immediately seek confirmation.

All the parties, particularly you and the other bank.

EUR 3,297,004.19

EUR 3,297,005.86

EUR 3,297,025.09

EUR 3,296,985.23

ARP

ARS

ARA

AED

The Model Code emphasizes the importance of clear, concise documentation and on-going lines of communication.

Bank management must guarantee a fixed price execution to the counterparty.

The Model Code recommends that only experienced dealers should be allowed to take such orders.

Bank staff must secure the approval of the counterparty’s management to accept such orders.

the last calendar day of the month

the last bank business day of the month

value last business day of the month against first business day of the next month

value first business day of the month against last business day of the same month

Buy a 3-month EUR/USD outright forward

Buy USD spot, and sell and buy a 3-month EUR/USD FX swap

Sell EUR/USD in the spot market, lend EUR for 3 months and borrow USD for 3 months

Sell EUR/USD in the spot market, borrow EUR for 3 months and lend USD for 3 months

19/21

2.1/1.9

21/19

0.21/0.19