Financial Institutions Management A Risk Management Approach 5E - CDN - Saunders - TBCH14

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1、CH14Student:___________________________________________________________________________1.Ifthecreditriskofaforeignborrowerisgood,thenthesovereigncountryriskisirrelevant.  True    False 2.FIsthatlendtoforeignentitiesoftenneedtomakeprovisionstotheirloanlossreserves.  True    False 3.S

2、overeigncountryriskexposureisaresultoftheFI'sinabilitytobefullydiversified.  True    False 4.Sovereigncountryriskislargelyindependentofthecreditstandingoftheforeignborrower.  True    False 5.Alendingdecisiontoafirminaforeigncountryshouldinvolvebothacreditriskanalysisandasovereignris

3、kanalysis.  True    False 6.Allofthefollowingarerelevantdeterminantsofsovereignriskexposure:therateofdomesticmoneysupplygrowth;thevarianceofexportrevenue,andthesizeofthepopulation.  True    False 7.Lendersoftenarewillingtorescheduledebtpaymentstoavoidforcingtheborrowerintooutrightba

4、nkruptcy.  True    False 8.Sovereignriskinvolvesrestrictionsplacedonborrowersandinvestorsregardingthemovementoffundsintoandoutofaforeigncountry.  True    False 9.Internationalbondfinanceismorelikelytoberescheduledthaninternationalloanfinancebecauseoftherelativelyfewerlendersinvolved

5、withaloanfinanceissue.  True    False 10.PriortoWorldWarII,mostinternationaldebtwasintheformofbankloans.  True    False 11.ReschedulingloansiseasierthanrenegotiatingpaymentsonbondsbecausethesameFIstypicallyformloansyndicatesthatcreatecohesivenessinnegotiations.  True    False 12.Int

6、ernationalloancontractsthatcontaincross-defaultprovisionsallowthecountrytoselectspecificlendersforspecialdefaulttreatment.  True    False 13.Sometimesbanksreceivedcriticismbecausedomesticgovernmentstakespecialpoliticalstepstoreducetheprobabilitythatforeignborrowerswilldefaultorrepud

7、iatetheirdebtcontracts,anoccurrencethatcouldcausefinancialharmtothedomesticbanks.  True    False 14.TheEconomistIntelligenceUnitisaratingofsovereignriskbasedoneconomicandpoliticalriskwithinacountry.  True    False 15.Thedebtserviceratioofacountryshouldbenegativelyrelatedtotheprobabi

8、lityofrescheduling.