ACCC (Australian Competition and Consumer Commission) - correct answer-A
federal government organisation that protects the rights of consumers and ensures
there is fair competition between companies by enforcing the Competition and
Consumer Act (2010).
Advantages of direct finance - correct answer--removes cost of financial intermediary
- diversify funding instruments and sources
- raise profile in financial markets
Advantages of intermediation - correct answer-- asset transformation: b & s are
offered a range of products
- maturity transformation: b & s are offered products with a range of terms to maturity
- credit risk diversification: savers credit risk limited to the intermediary
- provision of liquidity: cash flows risk return trade off
APRA (Australian Prudential Regulation Authority) - correct answer-Developing and
enfoecing a robust prudential framework that promotes prudent behaviour by ADIs,
insurance companies, superannuation funds and orher finanical institutions it
supervises, with the key aim of protecting the interests of their depoistors,
policyholders and superannuation fund members.
ASIC (Australian Securities and Investments Commission) - correct answer-ASIC's
main role is to enforce and regulate company and financial services laws to protect
Australian consumers, investors and creditors.
, asset management - correct answer-- Banks only give loans (assets) when it has
sufficient deposits.
- deposits held by a bank would determine how much it could lend.
- asset growth is managed, and often constrained by, the banks deposit base.
Attributes of financial system - correct answer-Return
Risk
Liquidity
Time-pattern of cash flows
Banks off balance sheet business - correct answer-Transactions that represent a
contingent liability those are not recorded on the balance sheet.
Basel accord - correct answer-Set of agreements set by the Basel committee of bank
supervision which provides recommendations on banking regulations in regard to
capital risk, market risk and operational risk.
capital market - correct answer-Provide medium-to-linger-term funding to finance
investment plans of businesses and governments. Encompass both the international
and domestic markets.
Eg. Equity market (common and preferred share)
Capital requirement - correct answer-BASEL II
Common equity: 2%
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