ACI ACI Certifications 3I0-012 Questions & Answers

• Question 221:

  What is the principal risk identified by gap management reporting?

  A. Currency risk

  B. Interest rate risk

  C. Operational risk

  D. Credit risk

  Correct Answer: B

• Question 222:

  A Eurozone-based bank that is liability-sensitive to market interest rate changes might reduce interest rate risk by:

  A. entering into a pay fixed I receive variable standard interest rate swap

  B. entering into a receive fixed I pay variable amortizing interest rate swap

  C. entering into a EUR/USD FX swap

  D. entering into a receive fixed I pay variable standard interest rate swap

  Correct Answer: A

• Question 223:

  A sold JUN 3-month STIR-future should be reported in the gap report as of 22 May:

  A. as a given deposit with a term of one month and a taken deposit with a term of four months

  B. as a taken deposit with a term of one month

  C. as a taken deposit with a term of one month and a given deposit with a term of four months

  D. as a given deposit with a term of four months

  Correct Answer: A

• Question 224:

  You have made a price by a Japanese bank in (SD 2,000,000.00 against JPY. They made you 98.95-03

  and you took the offer. USD/JPY is now quoted 98.78-81 and you square your position.

  What is your profit or loss?

  A. Profit of JPY 340.000

  B. Profit of JPY 1.500,000

  C. Loss of JPY 340.000

  D. LossofJPV 500.000

  Correct Answer: D

• Question 225:

  To establish and maintain a short position in deliverable securities, you must:

  A. Sell

  B. Sell and subsequently buy back

  C. Sell and borrow

  D. Sell, borrow and buy back simultaneously

  Correct Answer: C

• Question 226:

  What is the minimum basis on which a BCP should be updated and tested?

  A. Every 6 months

  B. Yearly

  C. Whenever the BCP procedures are changed

  D. Every 3 months

  Correct Answer: B

• Question 227:

  What does the Model Code recommend with regard to any give-up agreement between a prime broker and an executing dealer?

  A. That the Master FX Give-Up Agreement (FMLG - New York FED FXC) published by the Foreign Exchange Committee can be used for this purpose.

  B. That this agreement need not specify the permitted transaction types, tenors or credit limits.

  C. That this agreement must include instructions that the prime broker must advise the executing dealer promptly of trades for give-up.

  D. That this agreement should not involve any requirement for the executing dealer to inform the prime broker of the material terms of the transaction once a trade has been executed.

  Correct Answer: A

• Question 228:

  What is one of the responsibilities of the Middle Office according to the Model Code?

  A. Sending settlement instructions

  B. Investigating settlement discrepancies

  C. Keeping a contact list of all back office staff of the bank's counterparties

  D. Exchanging standard settlement instructions (SSIs)

  Correct Answer: B

• Question 229:

  Name switching is:

  A. the practice of a dealer attempting to replace one customer by a new one in a previously dealt transaction

  B. the practice of a broker having to show a new name to the dealer, although he was full on the first name presented to him

  C. the practice of a broker attempting to substitute a third name between the two original counterparties to clear the transaction

  D. the practice of a broker attempting to show a substitution name to get out of a situation in which he was stuffed by a dealer

  Correct Answer: C

• Question 230:

  Deals transacted directly or via a broker prior to 5:00 am Sydney time on Monday morning:

  A. are invalid

  B. must be approved by senior management before confirmation

  C. cannot be entered into without the approval of the local regulator

  D. are not considered to have been done in normal conditions or normal market hours

  Correct Answer: D