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Obtaining the PRMIA 8011: Credit and Counterparty Manager (CCRM) Certificate is a valuable achievement for professionals working in the credit and counterparty risk management field. The certificate is recognized globally and demonstrates a candidate’s expertise and commitment to the field. The CCRM certification program and the PRMIA 8011 exam are highly respected in the financial industry and are often considered a requirement for senior roles in credit and counterparty risk management.

PRMIA 8011 Credit and Counterparty Manager (CCRM) Certificate Exam is a professional certification program designed for individuals seeking a career in the credit and counterparty risk management field. 8011 Exam covers a wide range of topics related to credit and counterparty risk, including credit analysis, credit risk modeling, credit portfolio management, and counterparty risk management. The goal of the exam is to provide candidates with the knowledge and skills necessary to effectively manage credit and counterparty risk in financial institutions.

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Pass Guaranteed Quiz 2025 PRMIA 8011: Latest Download Credit and Counterparty Manager (CCRM) Certificate Exam Demo

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PRMIA Credit and Counterparty Manager (CCRM) Certificate Exam Sample Questions (Q157-Q162):

NEW QUESTION # 157
For the purposes of calculating VaR, an FRA can be modeled as a combination of:

A. a fixed rate bond and a zero coupon bond
B. two zero coupon bonds
C. a zero coupon bond and a floating rate note
D. a zero coupon bond and an interest rate swap

Answer: B

Explanation:
A forward rate agreement allows one of the parties to borrow an amount at a rate for a length of time, all of which are agreed in advance. Consider a "3 x 6" FRA. This allows a fixed rate borrowing starting at 3 months till the end of 6 months. This is economically equivalent to holding a zero coupon bond till the end of 6 months, and being short another zero coupon bond till the end of 3 months (or the other way round, depending upon which end of the FRA you are on). Therefore Choice 'c' is the correct answer.

NEW QUESTION # 158
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 and IV
B. I
C. II, III and IV
D. II and III

Answer: D

Explanation:
In a bankruptcy, equity ranks last. Preferred equity is one level above equity. Senior debt gets paid out first compared to junior debt, and secured debt is paid out first to the extent of the asset securing it (after which it counts as unsecured debt). Accounts payable and other short term liabilities are treated like unsecured creditors. Debtor-in-possession (DIP) financing ranks higher than any other asset as it is financing secured after the bankruptcy to continue the business.
Based on the above, statement I does not represent a correct ordering of seniority as equity is paid last.
Similarly, DIP financing receives higher priority than even secured debt, and therefore statement IV is incorrect. Therefore the only correct statements are II and III and Choice 'a' is the correct answer.

NEW QUESTION # 159
Under the contingent claims approach to measuring credit risk, which of the following factors does NOT affect credit risk:

A. Leverage in the capital structure
B. Volatility of the firm's asset values
C. Cash flows of the firm
D. Maturity of the debt

Answer: C

Explanation:
Under the contingent claims approach, credit risk is modeled as the value of a put option on the value of the firm's assets with a strike equal to the face value of the debt and maturity equal to the maturity of the obligation. The cost of credit risk is determined by the leverage ratio, the volatility of the firm's assets and the maturity of the debt. Cash flows are not a part of the equation. Therefore Choice 'a' is the correct answer.

NEW QUESTION # 160
There are two bonds in a portfolio, each with a market value of $50m. The probability of default of the two bonds over a one year horizon are 0.03 and 0.08 respectively. If the default correlation is zero, what is the one year expected loss on this portfolio?

A. $1.38m
B. $5.26m
C. $11m
D. $5.5m

Answer: D

Explanation:
The probabilities of default of the two bonds are independent (as indicated by a zero default correlation). The various possible states of the portfolio are as follows:
First bond defaults, and the second does not: Probability * Loss = 0.03*0.92 * $50m = $1.38m Second bond defaults, and the first does not: Probability * Loss = 0.97*0.08 * $50m = $3.88m Both bonds default: Probability * Loss = 0.03*0.08 * $100m = $0.24m Thus total expected loss on this portfolio = $5.5m. Since recovery rates are not provided, those should be assumed to be zero.
There is an easier way to solve this as well: default correlation does not affect expected losses, but their volatility. You can calculate the expected losses of the two bonds and add them up, ie, $50m*0.03 + $50m *0.
08 = $5.5m

NEW QUESTION # 161
Which of the following belong to the family of generalized extreme value distributions:
I. Frechet
II. Gumbel
III. Weibull
IV. Exponential

A. II and III
B. IV
C. All of the above
D. I, II and III

Answer: D

Explanation:
Extreme value theory focuses on the extreme and rare events, and in the case of VaR calculations, it is focused on the right tail of the loss distribution. In very simple and non-technical terms, EVT says the following:
1. Pull a number of large iid random samples from the population,
2. For each sample, find the maximum,
3. Then the distribution of these maximum values will follow a Generalized Extreme Value distribution.
(In some ways, it is parallel to the central limit theorem which says that the the mean of a large number of random samples pulled from any population follows a normal distribution, regardless of the distribution of the underlying population.) Generalized Extreme Value (GEV) distributions have three parameters: # (shape parameter), # (location parameter) and # (scale parameter). Based upon the value of #, a GEV distribution may either be a Frechet, Weibull or a Gumbel. These are the only three types of extreme value distributions.

NEW QUESTION # 162
......

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Download PRMIA 8011 Demo, 8011 Valid Vce Dumps

Pass Guaranteed Quiz 2025 PRMIA 8011: Latest Download Credit and Counterparty Manager (CCRM) Certificate Exam Demo

PRMIA Credit and Counterparty Manager (CCRM) Certificate Exam Sample Questions (Q157-Q162):

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