Accounting
Anthropology
Archaeology
Art History
Banking
Biology & Life Science
Business
Business Communication
Business Development
Business Ethics
Business Law
Chemistry
Communication
Computer Science
Counseling
Criminal Law
Curriculum & Instruction
Design
Earth Science
Economic
Education
Engineering
Finance
History & Theory
Humanities
Human Resource
International Business
Investments & Securities
Journalism
Law
Management
Marketing
Medicine
Medicine & Health Science
Nursing
Philosophy
Physic
Psychology
Real Estate
Science
Social Science
Sociology
Special Education
Speech
Visual Arts
Banking
Q:
A bank that is not owned by a holding company is called a(n) ______________ bank.
Q:
The Gramm-Leach-Bliley Act moved the U.S. banking industry closer to the concept of ___________ banking in which banks merge with security and insurance firms and various other financial products.
Q:
The key problem in a large money center bank is ________________. Managers may be knowledgeable about banking practices but may be less informed about products and services of subsidiary companies.
Q:
A(n) _____________________ is a special type of holding company that may offer the broadest range of financial services, including dealing in and underwriting securities, and selling and underwriting insurance.
Q:
A bank which operates exclusively over the internet is known as a ___________ bank.
Q:
A(n) __________________________ can invest in corporate stock as well as loan money to help finance the start of new ventures or support the expansion of existing businesses.
Q:
Managers who value fringe benefits, plush offices, and ample travel budgets over the pursuit of maximum returns for stockholders are exhibiting signs of _________________________.
Q:
A(n) ________________________ is a corporation chartered for the specific purpose of holding the stock of one or more banks, often along with other businesses.
Q:
A(n) _____________________ is one which offers its full range of banking services from only one location.
Q:
A(n) ___________________ is a machine located at the merchant's place of business which allows depositors to use their debit card to pay for purchases directly.
Q:
In theory, if an interstate organization can acquire banks in states where bank earnings have a ______________ with bank earnings in those states where the interstate company is already represented, a "portfolio effect" may occur.
A. perfectly positive correlation
B. negative correlation
C. zero correlation
D. zero covariance
E. positive covariance
Q:
____________ offer savings deposit plans and housing related credit, predominantly to individuals and families.
A. Insurance companies
B. Real estate companies
C. Trust companies
D. Factoring companies
E. Savings associations
Q:
________________ manage and care for the property of businesses, individuals, and non-profit organizations.
A. Insurance companies
B. Holding companies
C. Real estate companies
D. Trust companies
E. Factoring companies
Q:
A bank holding company that wishes to acquire _________ or more of equity shares of an additional bank must seek approval from the Federal Reserve Board.
A. 5 percent
B. 10 percent
C. 15 percent
D. 25 percent
E. 51 percent
Q:
Outside the United States, the holding company form:
A. is usually legal and very popular.
B. is usually legal but not often used.
C. is not legal.
D. is not legal yet popular.
E. is legal but never used.
Q:
One reason for the fairly large number of unit banks in the United States is:
A. de-merger of branch banks.
B. low profitability in larger banks.
C. continuous formation of new banks.
D. regulations prohibiting formation of branch banks.
E. All the options are correct.
Q:
In recent years, organizational hierarchy in banks is increasingly becoming more:
A. simpler.
B. complex.
C. vertical.
D. horizontal.
E. flat.
Q:
A money center bank is typically owned by:
A. private equity companies.
B. bank holding companies.
C. foreign banks.
D. hedge funds.
E. mutual funds.
Q:
Senior management of a community bank reports periodically to the:
A. management.
B. managing director.
C. CEO.
D. board of directors.
E. stockholders.
Q:
A bank devoted principally to the markets for smaller, locally based deposits and loans is often referred to as a(n):
A. wholesale bank.
B. retail bank.
C. commercial bank.
D. investment bank.
E. social bank.
Q:
A financial holding company (FHC), defined as a special type of holding company that may offer the broadest range of financial services such as securities and insurance activities, was allowed under which act?
A. Riegle-Neal Interstate Banking and Branching Efficiency Act
B. The Competitive Equality in Banking Act
C. The Basel Agreement
D. The FDIC Improvement Act
E. The Gramm-Leach-Bliley (Financial Services Modernization) Act
Q:
Nonbank financial firms that supply insurance coverage to customers borrowing money to guarantee repayment of a loan are referred to as:
A. merchant bankers.
B. factoring companies.
C. savings associations.
D. investment bankers.
E. credit insurance underwriters.
Q:
Banks with _______ in assets are generally called community banks.
A. more than $1 billion
B. less than $1 billion
C. more than $5 million
D. less than $1 trillion
E. more than $1 trillion
Q:
Gradual evolution of markets and institutions such that geographic boundaries do not restrict financial transactions is known as:
A. deregulation.
B. integration.
C. re-regulation.
D. globalization.
E. moral suasion.
Q:
When different financial service providers offer a similar range of services including banking, insurance and securities services, it is known as:
A. consolidation.
B. convergence.
C. economies of scale.
D. e-efficiencies.
E. None of the options are correct.
Q:
Which of the following country's banks were owned by the state until the 1990's?
A. Belgium
B. France
C. Germany
D. Italy
E. None of the options are correct
Q:
Of the following countries in Europe, which one has the largest number of banks?
A. Belgium
B. France
C. Germany
D. Great Britain
E. None of the options are correct
Q:
Consolidation, particularly among saving associations, finance companies, credit unions, security firms, and insurance companies, is:
A. occurring at a rapid pace.
B. non-existent.
C. occurring at a slow pace.
D. disapproved of by the regulators.
E. None of the options are correct.
Q:
According to Levonian and Rose, in order to achieve some reduction in earnings risk, interstate banks must:
A. expand into different product lines.
B. expand into a number of different regions.
C. increase the number of people in the management.
D. increase the number of employees.
E. buy smaller banks.
Q:
Many financial experts believe that the customers most likely to be damaged by decreased competition include:
A. large corporations in large cities.
B. households and business in smaller cities and towns.
C. households that earn more than a million dollars a year.
D. students away at college.
E. None of the options are correct.
Q:
When a bank holding company acquires a nonbank business it must be approved by the:
A. FDIC.
B. Comptroller of the Currency.
C. Federal Reserve.
D. SEC.
E. All the options are correct
Q:
Under the Bank Holding Company Act, control of a bank is assumed to exist only if:
A. The bank holding company acquires 100% of at least one bank's outstanding stock
B. The bank holding company acquires 50% or more of at least one bank's outstanding stock
C. The bank holding company acquires 25% or more of at least one bank's outstanding stock
D. The bank holding company acquires at least three banks
E. None of the options are correct
Q:
Which of the following created the Truth in Savings Act?
A. The FDIC Improvement Act
B. The International Banking Act
C. The Sarbanes-Oxley Act
D. The Gramm-Leach-Bliley Act
E. The Financial Institutions Reform, Recovery and Enforcement Act
Q:
Which of the following acts created a Financial Stability Oversight Council to dampen systemic risk?
A. The Dodd-Frank Regulatory Reform Act
B. The Sarbanes-Oxley Act
C. The Garn-St Germain Depository Institutions Act
D. The Gramm-Leach-Bliley Act
E. The Financial Institutions Reform, Recovery and Enforcement Act
Q:
_____ allows European and foreign banks greater freedom to cross national borders.
A. The European Monetary Union
B. The European Council
C. The Sarbanes-Oxley Act
D. The Garn-St Germain Depository Institutions Act
E. The Gramm-Leach-Bliley Act
Q:
_____ requires corporations controlling two or more banks to register with the Federal Reserve Board and seek approval for any new business acquisitions.
A. The Glass-Steagall Act
B. The Federal Deposit Insurance Corporation Improvement Act
C. The National Bank Act
D. The Riegle-Neal Interstate Banking and Branching Efficiency Act
E. The Bank Holding Company Act
Q:
As per the National Currency and Bank Acts, the comptroller of currency ensures that every national bank is examined by a team of federal examiners at least:
A. twice in a year.
B. once in 3 months.
C. once every 12 to 18 months.
D. once every 9 to 12 months.
E. once in a month.
Q:
The Emergency Economic Stabilization Act passed in 2008 during the global credit crisis, allowed for:
A. an emergency sale of "bad assets".
B. a temporary increase of FDIC deposit insurance to $250,000 for all deposits.
C. injections of capital by the government into banks and other qualified lenders.
D. a closer surveillance of the mortgage market participants, such as brokers and lenders.
E. All of the options are correct.
Q:
The Financial Services Regulatory Relief Act of 2006:
A. adds selected new service powers to depository institutions.
B. loosens regulations on depository institutions.
C. grants the Federal Reserve authority to pay interest on depository institutions' legal reserves.
D. All of the options are correct.
E. None of the options are correct.
Q:
Which federal banking act extends deposit insurance coverage on qualified retirement accounts from $100,000 to $250,000 and authorizes the FDIC to periodically increase deposit insurance coverage to keep up with inflation?
A. The Sarbanes-Oxley Act
B. The Gramm-Leach-Bliley Act
C. The Check 21 Act
D. The Fair and Accurate Credit Transactions Act
E. The Federal Deposit Insurance Reform Act
Q:
The Federal Reserve buys Treasury Bills in the open market. This will tend to:
A. decrease the price of treasury bills.
B. increase the available for use funds with banks and dealers involved in the transaction.
C. cause reserves held at the Federal Reserve to decrease.
D. cause a decrease in the growth of deposits and loans.
E. All of the options are correct.
Q:
Which of the following has become the principal tool of central bank monetary policy today?
A. Open market operations
B. Functional regulation
C. Umbrella supervision and regulation
D. Margin requirement
E. None of the options are correct.
Q:
The European Central Bank has the main goal of:
A. ensuring that commercial and investment banks are separated.
B. keeping unemployment low.
C. ensuring price stability.
D. ensuring an adequate and fair supply of loans.
E. All of the above options are correct.
Q:
There is an important debate raging today regarding whether banks should be regulated at all. George Benston contends that:
A. firms in regulated industries actually seek out regulations because they bring monopolistic rents.
B. regulations shelter firms from changes in demand and cost, lowering its risk.
C. regulations can increase consumer confidence which increases customer loyalty to regulated firms.
D. depository institutions should be regulated no differently than any other corporation with no subsidies or special privileges.
E. None of the above options are correct.
Q:
Samuel Peltzman had a different view to George Stigler on the impact of regulation on banks. He contends that:
A. firms in regulated industries actually seek out regulations because they bring monopolistic rents.
B. regulations shelter firms from changes in demand and cost, lowering its risk.
C. regulations can increase consumer confidence which increases customer loyalty to regulated firms.
D. depository institutions should be regulated no differently than any other corporation with no subsidies or special privileges.
E. None of the options are correct.
Q:
One of the earliest theories regarding the impact of regulation on banks was developed by George Stigler. He contends that:
A. firms in regulated industries actually seek out regulations because they bring monopolistic rents.
B. regulations shelter firms from changes in demand and cost, lowering its risk.
C. regulations can increase consumer confidence which increases customer loyalty to regulated firms.
D. depository institutions should be regulated no differently than any other corporation with no subsidies or special privileges.
E. None of the options are correct.
Q:
The _________ allows adequately capitalized bank holding companies to acquire banks in any state.
A. Riegle-Neal Interstate Banking and Branching Efficiency Act
B. Competitive Equality Banking Act
C. Financial Institutions Reform, Recovery and Enforcement Act
D. Federal Deposit Insurance Corporation Improvement Act
E. Depository Institutions Deregulation and Monetary Control Act
Q:
Which federal banking act requires the Federal Trade Commission to make it easier for victims of identity theft to file theft reports and requires credit bureaus to help victims resolve the problem?
A. The Sarbanes-Oxley Act
B. The USA Patriot Act
C. The Check 21 Act
D. The Fair and Accurate Credit Transactions Act
E. The Bankruptcy Abuse Prevention and Consumer Protection Act
Q:
Which federal banking act forces more individuals to repay at least part of what they owe and will push higher-income borrowers into more costly forms of bankruptcy?
A. The Sarbanes-Oxley Act
B. The USA Patriot Act
C. The Check 21 Act
D. The Fair and Accurate Credit Transactions Act
E. The Bankruptcy Abuse Prevention and Consumer Protection Act
Q:
Which federal banking act reduces the need for banks to transport paper checks across the country?
A. The Sarbanes-Oxley Act
B. The USA Patriot Act
C. The Check 21 Act
D. The Fair and Accurate Credit Transactions Act
E. The Bankruptcy Abuse Prevention and Consumer Protection Act
Q:
Which federal banking act prohibits publishing false or misleading information about the financial performance of a public company and requires top corporate officers to vouch for the accuracy of their company's financial statements?
A. The Sarbanes-Oxley Act
B. The USA Patriot Act
C. The Check 21 Act
D. The Fair and Accurate Credit Transactions Act
E. The Bankruptcy Abuse Prevention and Consumer Protection Act
Q:
Which federal banking act requires that financial service providers establish the identity of customers opening new accounts?
A. the Sarbanes-Oxley Act
B. the USA Patriot Act
C. the Check 21 Act
D. the Fair and Accurate Credit Transactions Act
E. the Bankruptcy Abuse Prevention and Consumer Protection Act
Q:
The federal agency that regulates the most banks is the:
A. Office of the Comptroller of the Currency.
B. Federal Deposit Insurance Corporation.
C. Federal Reserve System.
D. state banking commission.
E. state insurance commission.
Q:
The oldest federal bank agency is the:
A. Office of the Comptroller of the Currency.
B. Federal Deposit Insurance Corporation.
C. Federal Reserve System.
D. state banking commission.
E. state insurance commission.
Q:
The fastest growing financial crime in the U.S. is:
A. financial statement misrepresentation.
B. bank robberies.
C. individual privacy violations.
D. credit card fraud.
E. identity theft.
Q:
Common minimum capital requirements on banks in leading industrialized nations that are based on the riskiness of their assets is imposed by:
A. the National Banking Act.
B. the Financial Institutions Reform, Recovery and Enforcement Act.
C. the International Banking Act.
D. the Basel Agreement.
E. None of the options are correct.
Q:
The 1977 act that prevents banks from "redlining" certain neighborhoods, refusing to serve those areas is:
A. the National Banking Act.
B. the Garn-St. Germain Act.
C. the Financial Institutions Reform, Recovery and Enforcement Act.
D. the Riegle-Neal Interstate Banking and Branching Efficiency Act.
E. the Community Reinvestment Act.
Q:
The act which requires financial institutions to share information about customer identities with government agencies is:
A. the Sarbanes-Oxley Act.
B. the National Banking Act.
C. the Garn-St Germain Depository Institutions Act.
D. the USA Patriot Act.
E. the Gramm-Leach-Bliley Act.
Q:
As per the Gramm-Leach-Bliley Act, one of the ways through which a banking-insurance-securities affiliation can take place is through:
A. a financial holding company.
B. the state insurance commissions.
C. the European Central Bank.
D. a financial service corporation.
E. a financial modernization organization.
Q:
The equivalent of the Federal Reserve System in Europe is known as the:
A. European Union.
B. Bank of London.
C. European Council.
D. European Central Bank.
E. Swiss Bank Corporation.
Q:
The act that allowed bank holding companies to acquire nonbank depository institutions and convert them to branches is:
A. the National Banking Act.
B. the Garn-St Germain Act.
C. the Financial Institutions Reform, Recovery and Enforcement Act.
D. the Riegle-Neal Interstate Banking and Branching Efficiency Act.
E. None of the options are correct.
Q:
The law that made bank and nonbank depository institutions more alike in the services they could offer and allowed banks and thrifts to more fully compete with other financial institutions is:
A. the National Banking Act.
B. the Federal Reserve Act.
C. the Garn-St Germain Depository Institutions Act.
D. the Riegle-Neal Interstate Banking and Branching Efficiency Act.
E. the Gramm-Leach-Bliley Act (Financial Services Modernization Act).
Q:
Which of the following is an unresolved issue in the new century?
A. What should be done about the regulatory safety net set up to protect small depositors?
B. If financial institutions are allowed to take on more risk, how can taxpayers be protected from paying the bill when more institutions fail?
C. Does functional regulation actually work?
D. Should regulators allow the mixing of banking and commerce?
E. All of these are unresolved issues
Q:
Of the principal reasons for regulating banks, what was the primary purpose of the Consumer Credit Protection Act?
A. Establish a network to clear and collect checks
B. Control of the money supply
C. Prevent banks from realizing monopoly powers
D. Ensure that customers are aware of their rights and responsibilities under a loan agreement
E. None of the options are correct.
Q:
The law that allows banks to affiliate with insurance companies and securities firms to form financial services conglomerates is:
A. the National Bank Act.
B. the Glass-Steagall Act.
C. the Garn-St Germain Depository Institutions Act.
D. the Riegle-Neal Interstate Banking Act.
E. the Gramm-Leach-Bliley Act (Financial Services Modernization Act).
Q:
The law which lifted government deposit interest ceilings in favor of competitive interest rates is:
A. the National Bank Act.
B. the Glass-Steagall Act.
C. the Bank Merger Act.
D. the Depository Institutions Deregulation and Monetary Control Act.
E. None of the options are correct.
Q:
The 1994 law that allowed bank holding companies to acquire banks anywhere in the U.S. is:
A. the Glass-Steagall Act.
B. the Federal Deposit Insurance Corporation Improvement Act.
C. the National Bank Act.
D. the Riegle-Neal Interstate Banking and Branching Efficiency Act.
E. None of the options are correct.
Q:
The Federal Reserve policy tool under which the Fed attempts to bring psychological pressure to bear on individuals and institutions to conform to the Fed's policies using letters, phone calls, and speeches is known as:
A. margin requirement.
B. moral suasion.
C. discount window supervision.
D. conference and compromise.
E. None of the options are correct.
Q:
The Gramm-Leach-Bliley Act (Financial Services Modernization Act) calls for linking the government supervision of the financial-services firm to the types of activities that the firm undertakes. For example, the insurance portion of the firm would be regulated by state insurance commissions and the banking portion of the firm would be regulated by banking regulators. This approach to government supervision of financial services is known as:
A. consolidated regulation and supervision.
B. functional regulation.
C. government reregulation.
D. umbrella supervision and regulation.
E. None of the options are correct.
Q:
The federal law that prohibited federally supervised commercial banks from offering investment banking services on privately issued securities is known as:
A. the Glass-Steagall Act.
B. the Bank Merger Act.
C. the Depository Institutions Deregulation and Monetary Control Act.
D. the Federal Reserve Act.
E. None of the options are correct.
Q:
The law that set up the federal banking system and provided for the chartering of national banks was the:
A. National Bank Act.
B. McFadden Act.
C. Glass-Steagall Act.
D. Bank Merger Act.
E. Federal Reserve Act.
Q:
An institutional arrangement in which federal and state authorities both have significant bank regulatory powers is referred to as:
A. balance of power.
B. federalism.
C. dual banking system.
D. cooperative regulation.
E. coordinated control.
Q:
Banks are regulated for which of the reasons listed below?
A. Banks are leading repositories of the public's savings.
B. Banks have the power to create money.
C. Banks provide businesses and individuals with loans that support consumption and investment spending.
D. Banks assist governments in conducting economic policy, collecting taxes, and dispensing government payments.
E. All of the options are correct.
Q:
One of the principal reasons for government regulation of financial firms is to protect the safety and soundness of the financial system.
Q:
The tool used by the Federal Reserve System to influence the economy and behavior of banks is known as moral hazard.
Q:
Passed in 1977, the Equal Credit Opportunity Act prohibits banks from discriminating against customers merely on the basis of the neighborhood in which they live.
Q:
The Gramm-Leach-Bliley Act of 1999 essentially repeals the Glass-Steagall Act passed in the 1930s.
Q:
The Sarbanes-Oxley Act allows banks, insurance companies, and securities firms to form Financial Holding Companies (FHCs).
Q:
The Financial Institutions Reform, Recovery, and Enforcement Act (1989) allowed bank holding companies to acquire nonbank depository institutions and, if desired, convert them into branch offices.
Q:
The National Bank Act (1863-64) created the Federal Reserve which acts as the lender of last resort.