Unit 4 - Bank Risks

Question 1

The global institute for Risk Management Standards 2019 defines risk as:

Answer 1

The effect of uncertainty on objectives, whether these effects are positive or negative

Question 2

The 5 types of risk that unit 4 focuses on are?

Answer 2

Credit risk, algorithms and machine learning risk, climate related risk, operational risk and cyber risk

Question 3

A risk with high probability and low impact would typically be?

Answer 3

Controlled

Question 4

An effective key risk indicator:

Answer 4

Tracks a particular important risk exposure very well

Question 5

Operational risk is:

Answer 5

The risk of direct or indirect loss resulting from inadequate or failed internal processes, people and systems or from external events

Question 6

From a regulatory perspective, the FCA’s firm systematic framework is designed to assess, for a firm, the level of:

Answer 6

Conduct risk

Question 7

Which of these is not an element of pestle? Political, environmental, external and legal?

Answer 7

External

Question 8

Enterprise risk management frameworks typically include variations of components suggested by COSO 2017. Which of the following is not one of these components? Governance and culture, strategy and objective setting, review and revision, stakeholder management?

Answer 8

Stakeholder management

Question 9

When managing credit risk, what is a key concept?

Answer 9

Know your risk

Question 10

Which regards to algorithms and machine learning risk, risks can arise from:

Answer 10

Data input, Algorithm design and data output

Question 11

Deloitte 2017 suggest a risk management framework to effectively manage algorithmic risks, key components are:

Answer 11

Strategy & governance,
Design,
Development,
Deployment and use,
Monitoring and testing

Question 12

With regards to climate related risk, which organisation publishes its annual global risk report to identify and analyse the greatest risks and issues facing the world?

Answer 12

World Economic Forum

Question 13

Climate change is posing risks for the financial sector, the global economy and society as a whole. these risks are classified as…

Answer 13

Physical risks, transition risks and liability risk

Question 14

The task force on climate relation financial disclosures (TCFD) set out 4 key themes that in its view, represent core elements of how organisations operate. These are:

Answer 14

Governance
Strategy
Risk management
Metrics and targets

Question 15

Risk.net conducts an annual global survey of operational risk practitioners to identify the biggest operational risks in financial services. Amongst the top 10 risks for 2019, what is not one of them:
Data compromise, brexit, legal risk, theft & fraud

Answer 15

Legal risk

Question 16

Ransomeware is defined as:

Answer 16

A type of malicious software designed to deny access to files, or threaten to publish the victims data

Question 17

Operational resilience as well as what, is key to maintaining financial stability in the economy?

Answer 17

Effective regulatory set up

Question 18

Distributed denial of service (DDoS) is a cyber attack where:

Answer 18

The hacker seeks to either temporarily or indefinitely disrupt and organisations network services

Question 19

In feb 2019, who became the first major bank to publicly disclose SS7 attacks against its customers?

Answer 19

Metro bank

Question 20

A risk with low probability and high impact would typically be?

Answer 20

Transferred