Exam 2: Financial Services: Depository Institutions

According to the text, how many of the largest corporate credit unions were ultimately declared insolvent during the recent financial crisis?

Lehman Brothers failed during the recent financial crisis despite having access to the low cost sources of funds offered by the Federal Reserve.

By converting to a bank holding company, an investment bank gains access to Federal Reserve lending facilities.

According to the American Bankers Association, the tax-exempt status of credit unions is the equivalent of a $1 billion per-year subsidy to the industry.

Although growing, the notional value of bank OBS activities remained less than the value of on-balance-sheet activities as of mod-2015.

Which of the following FIs does not provide a business lending function?

Large banks tend to make business decisions based on personal knowledge of customer's creditworthiness and business conditions in the local communities.

Trust services department of a bank includes estate assets and pension fund assets.

The credit union industry avoided much of the financial distress of the 1980s because of the short maturity and relatively lower credit risk of their assets.