Off-Balance-Sheet Activities Contributed to the 2008 Global Financial Crisis with Increasing

Multiple Choice

Off-balance-sheet activities contributed to the 2008 global financial crisis with increasing financial market solvency risk exposure caused by:

A) loans sold with recourse had contingent liability implications for FIs when these loans went 'bad'
B) sub-prime mortgages and OBS securities backed by these mortgages peaked prior to the mortgage market collapse
C) the market for derivatives was opaque and 'trades' complex leading to counterparty risk where firms dealt directly with each other
D) All of the listed options are correct.