3I0-012

3I0-012 practice questions, page 18 of 30, with answer review and explanations.

Question 86

The use of standard settlement instructions (SSI’s) is strongly encouraged because:

  1. it reduces operational risk
  2. it splits differences arising from failed settlement between the two counterparties
  3. it removes the need for sending out SWIFT confirmations
  4. the use of SSI’s secures the trading on more secure platforms

Question 87

Which of the following statements is true concerning dealing and rollovers at non-current rates?

  1. When setting the rates for an FX swap to extend the maturity, the spot rate should be fixed immediately within the current spread
  2. Where the use of non-current rates may be necessary, they should only be entered into with the prior explicit permission of the quoting party’s senior management
  3. Dealing and rollovers at non-current rates are relatively common market practice and therefore should not be treated differently from any other transaction
  4. Dealing and rollovers at non-current rates are forbidden as they can help perpetrate fraud and tax evasion

Question 88

A bank that has quoted a firm price is obliged to deal:

  1. At that price
  2. At that price in a marketable amount
  3. At that price in a marketable amount, provided the counterparty’s name is acceptable
  4. At that price in a marketable amount, provided the counterparty’s name is acceptable and the market price has not moved excessively

Question 89

Confirmations of non-prime brokerage deals using CLS should be exchanged:

  1. within 2 hours after deal agreed with counterparty
  2. before the value date of the trade
  3. by the end of the trade date
  4. within 24 hours

Question 90

Your agent bank accepts your back-valuation request for 1 day on an amount of EUR 50,000,000.00. EONIA is 0.375% and the ECB marginal lending facility rate is 1.50%. Applying conventional administration fees, how much will this be charged?

  1. EUR 620.83
  2. EUR 868.06
  3. EUR 968.06
  4. EUR 2,183.33