18 Questions
What is a key difference between credit unions and banks/savings associations?
Credit unions are only allowed to serve members.
Which regulatory body oversees federally chartered credit unions in the US?
National Credit Union Administration (NCUA)
What does the PEARLS monitoring system help with in credit unions?
Analyzing the financial condition comprehensively
What aspect of a credit union's operations does 'Asset Quality' in PEARLS focus on?
Credit risk management
Which country's credit unions are regulated by the Financial Services Commission (FSC)?
Barbados
What is the primary restriction on credit unions regarding serving the general public?
They cannot serve the general public, only their members.
What type of assets are reserves with the central bank and government securities?
Liquid assets
Which category represents loans to enterprises on the balance sheet?
Commercial and Industrial
What does the reserve for Loan Losses indicate about an institution's risk exposure?
High credit risk
Where are large time deposits and other deposits typically classified on the balance sheet?
Under Deposits
Foreign assets and foreign liabilities are often used to mitigate which type of risk?
Foreign exchange risk
What does a high level of borrowed funds compared to equity capital suggest about an institution's leverage?
High leverage
What is a key characteristic used to evaluate loan quality?
Proportion of non-performing loans
Why do Savings Institutions enjoy concessionary rates of borrowing from the central bank?
They provide loans for mortgages
What is a key characteristic of Credit Unions (CUs)?
Tax exempt status
Which term refers to the ability of an institution to withstand stresses such as changes in interest rates?
Sensitivity
Why were Savings Institutions created?
To focus on individual homebuyers
What sets Credit Unions apart from commercial banks and savings associations?
Tax-exempt status
Test your knowledge on loan quality, government bonds versus corporate debt, non performing loans, management effectiveness, earnings analysis, liquidity assessment, and sensitivity to economic stresses in financial institutions.
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