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Which of the Following Is True of an 'Adverse Material

Question 28

Multiple Choice

Which of the following is true of an 'adverse material change in conditions clause' used in a loan commitment?


A) It allows the FI to cancel or reprice a loan commitment.
B) It protects the lender against takedown risk.
C) It protects the lender against basis risk.
D) Exercise of the clause helps defaulted borrowers.

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