Question: All off-balance-sheet items will eventually move on to the balance sheet at some point in time. A. True B. False If a future credit crunch

  1. All off-balance-sheet items will eventually move on to the balance sheet at some point in time.

    A.

    True
    B.

    False

  2. If a future credit crunch is possible, a loan commitment may expose the FI to

    A.

    credit risk.
    B.

    interest rate risk.
    C.

    sovereign country risk.
    D.

    funding risk.
    E.

    exchange rate risk.

  3. Interest rate risk is part of the loan commitment contingent risk because of the uncertainty of changes in interest rates before the borrower exercises his option to borrow.

    A.

    True
    B.

    False

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