THURSDAY: 16 December 2021. Time Allowed: 3 hours.
Answer ALL questions. Marks allocated to each question are shown at the end of the question.
QUESTION ONE
1. Explain four factors a credit manager should consider when formulating a credit policy. (8 marks)
2. Analyse three practices prohibited in Islamic banking. (6 marks)
3. Assess six responsibilities of a micro finance credit committee. (6 marks)
(Total: 20 marks)
QUESTION TWO
1. Analyse five actions that the board and appropriate board committees might consider as part of their credit risk management oversight within an organisation. (10 marks)
2. Explain three responsibilities of Digital Lenders Associations (DLAs) in your country. (6 marks)
3. With reference to SACCO society regulations 2020, outline four lending disclosure requirements. (4 marks)
(Total: 20 marks)
QUESTION THREE
1. Analyse four principles of Basel III. (8 marks)
2. Discuss the seven principles of cooperatives. (7 marks)
3. With reference to central bank prudential guidelines, describe five elements of a sound capital assessment process. (5 marks)
(Total: 20 marks)
QUESTION FOUR
1. Explain one objective and one key policy instrument of the following types of financial regulations:
Prudential. (2 marks)
Allocative. (2 marks)
Protective. (2 marks)
Organisational. (2 marks)
2. Describe the following measures of assets performance.
Average collection period. (3 marks)
Collection effective index. (3 marks)
3. Enumerate three delinquency management methods used by microfinance institutions. (6 marks)
(Total: 20 marks)
QUESTION FIVE
1. Explain three benefits of good corporate governance in financial institutions regulatory agencies. (6 marks)
2. Explain any three basic principles of Islamic banking. (6 marks)
3. Distinguish between the following approaches to values:
“The utilitarian approach” and “The rights approach”. (4 marks)
The “virtue approach” and “The common-good approach”. (4 marks)
(Total: 20 marks)
