Multiple choice: 1. Extended by banks to qualified borrowers A. Investment B. Insecure loans C. Stand-by-credit D. Financial advice 2. Pricing is an Art, except A. To reduce losses B. Overhaul accredited suppliers C. To maintain market share D. To optimize profit
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- Styles Editing QUESTION TWO Voice Sensitivity Editor Rem Selamat Islamic Bank Berhad (SIBB) just announced its financial report for the year ended 2016. Table below is a summary of CIBB's financial report. (a) Items RM (000) Income Statement Operating Revenue Net Income Expenses Profit after tax and zakat 3,662,444 1,540,333 700,343 543,443 Statement of Financial Position Current Asset Current Liability- Demand deposit Total Debt Total Assets 4,332,300 10,635,054 42,091,092 45,620,442 3,729,590 Total Equity Capital Evaluate SIBB's performance based on the following financial ratios and explain what each ratio means. i. The capability of management in converting assets into net earnings. i. The effectiveness of management to control cost, expenses and service price O Focus 目 (United Kingdom) ENCplease answer and explain What does a proper loan structure accomplish for the borrower and the lender? A. Supports everyday operations; maximizes flat fees charged for the loan B. Minimizes interest fees; restricts the client from making any risky decisions C. Satisfies financial needs; optimizes profitability D. Maximizes available funds; charges the highest interest rate3) Long-term customer relationships easier to credit risks. A) reduce; screen B) increase; screen C) reduce; increase D) increase; increase the cost of information collection and make it
- A credit manager considering whether to grant trade credit to a new customer is most likely to place primary emphasis on a. b. profitability ratios. valuation ratios. C. growth ratios. d. liquidity ratios.What are the advantages and disadvantages of implementing credit scoring within a financial institution?THESE QUESTIONS REQUIRE YOU TO STATE WHICH OF THESE ITEMS BELONG TO ADVANTAGE OR DISADVANTAGE. (ANSWER A – ADVANTAGE / B – DISADVANTAGE) 1 Less labour costs 2 Ability to grow the loan portfolios with less resources 3 Ability to apply standardisation across the network 4 The implementation of an impersonal and distant 5 Allows use of experienced staff at the centralised level 6 High turnover of staff based on lower job satisfaction 7 Risk and return can be quantified across the portfolios 8 A measurable rejection method 9 The potential for inappropriate analysis and decision-making 10 Lower levels of investment in training of lending officers 11 Potential alienation of the targeted client group 12 Losses are managed with statistically acceptable boundaries * (ANSWER A – ADVANTAGE / B – DISADVANTAGE) 1 Less labour costs 2 Ability to grow the loan portfolios with less…Efficient customer service could be achieved through avoiding stock outs by making accurate A. Costs B. Sales C. Discounts D. Forecasts
- Question On occasion, the company will contemplate changing its credit standards in order to improve its performance and create greater value for owners. true or false?As a financial manager,;one's goalsfor the client is to help them dothe following EXCEPT: A. Build credit by encouraging them to acquire as many loan as possible so that the firm value or the total asset of the firm will increase.B. Identify investment opportunities and determine whether these are acceptable to their risk preference.C. Determine ways to reduce non-value adding costsD. Create budgets that would enable them to determine excess or inadequacy of cash.The goal of credit policy is to Maximise sales Minimise bad debt losses Minimise collection expenses Extend credit to the point where marginal profits equal marginal costs
- A. Determine the decision nature of each of the following issues: What are the least expensive sources of funds for the firm? A large retailer such as LuLu Hypermarket, deciding whether to open another store? Will we purchase on credit or will we borrow in the short term and pay cash? The decision to develop and market a new software by a company such as Microsoft. Choosing among lenders and among loan types?CREDIT RISK AND LOAN PRICING “When you package your home loan and bank account, you could enjoy multiple benefits including interest rate discounts and savings on a range of great products.” (i) Does the statement above suggest banks should adopt user pays pricing or bundled product pricing and why? (ii) Which group of customers will be most suited to the pricing method that you have identified in part (i) and why?Increasing credit to customers increases operating cycle Select one: True False