Chapter 6 - IT CISI

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1. Under UK Law the BORROWER of securities becomes what type of owner?

  • Nominal Owner - receives all dividends, coupons and any action proceeds at the end of the loan period.
  • Nominal Owner - receives all dividends, coupons and any action proceeds during the period of the loan.
  • Nominal Owner - receives all dividends & interest during the period of the loan.
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2. Securities firms that act as specialized intermediaries in the stock lending area to create liquidity in the market are known as what?

  • Custodians
  • Repos
  • Stock Lending Intermediaries (SLIs)
  • Stock lending Firms

3. What is the threshold if a firm wishes to "settle within a tolerance"?

  • USD 50.00
  • USD 25.00
  • USD 100.00
  • USD 250.00

4. A closed user group which is not eligible for SCORE and where the corporate can only communicate with their bank is called what?

  • SCORE
  • MA-CUG
  • FAFT

5. What is the motivation of the BORROWER of Repo Transaction?

  • to acquire a specific quantity of a given stock to meet their commitment to deliver
  • To borrow cash at a better rate of interest than it would if it borrowed on an unsecured basis
  • to lend cash on a secured basis
  • To increase their return by loaning out stock for a fee.
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