Which of the following statements is true in relation to the Supervisory Capital Assessment Program (SCAP):
I. The SCAP is an annual exercise conducted by the Treasury Department to determine the health of key financial institutions in the US economy II. The SCAP was essentially a stress test where the stress scenarios were specified by the regulators III. Capital buffers calculated under the SCAP represented the amount of capital that the institutions covered by SCAP held in excess of Basel II requirements IV. The SCAP focused on both total Tier 1 capital as well as Tier 1 common capital

• A. I and III
• B. II and IV
• C. I, II and IV
• D. I and III

Which of the following statements are true:
I. Credit risk and counterparty risk are synonymous
II. Counterparty risk is the contingent risk from a counterparty's default in derivative transactions III. Counterparty risk is the risk of a loan default or the risk from moneys lent directly IV. The exposure at default is difficult to estimate for credit risk as it depends upon market movements

• A. III and IV
• B. II and III
• C. I and II
• D. II

Which of the following was not a policy response introduced by Basel 2.5 in response to the globalfinancial crisis:

• A. Comprehensive Risk Model (CRM)
• B. Incremental Risk Charge (IRC)
• C. Stressed VaR (SVaR)
• D. Comprehensive Capital Analysis and Review (CCAR)

Which of the following are ordered correctly in the order of debt seniority in a bankruptcy situation?
I). Equity, Subordinate debt, Senior debt
II). Senior debt, Preferred stock, Equity
III). Secured debt, Accounts payable, Preferred stock
IV). Secured debt, DIP financing, Equity

• A. I
• B. II, III and IV
• C. I and IV
• D. II and III