PRMIA 8008 Q&A - in .pdf

  • Exam Code: 8008
  • Exam Name: PRM Certification - Exam III: Risk Management Frameworks, Operational Risk, Credit Risk, Counterparty Risk, Market Risk, ALM, FTP - 2015 Edition
  • Updated: Sep 09, 2026
  • Q & A: 359 Questions and Answers
  • Printable PRMIA 8008 PDF Format. It is an electronic file format regardless of the operating system platform.
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PRMIA 8008 Q&A - Testing Engine

  • Exam Code: 8008
  • Exam Name: PRM Certification - Exam III: Risk Management Frameworks, Operational Risk, Credit Risk, Counterparty Risk, Market Risk, ALM, FTP - 2015 Edition
  • Updated: Sep 09, 2026
  • Q & A: 359 Questions and Answers
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PRMIA 8008 Exam Syllabus Topics:

SectionObjectives
Topic 1: Operational Risk- Operational risk types and sources
- Operational risk management techniques
  • 1. Risk and control self-assessment (RCSA)
    • 2. Loss event data collection
      • 3. Key risk indicators (KRI)
        Topic 2: Credit Risk- Credit risk measurement and modeling
        • 1. Loss given default (LGD)
          • 2. Probability of default (PD)
            • 3. Exposure at default (EAD)
              - Credit portfolio risk
              Topic 3: Counterparty Risk- Derivatives credit risk considerations
              - Counterparty credit exposure
              - Netting and collateral management
              Topic 4: Funds Transfer Pricing (FTP)- FTP methodologies
              - Internal pricing of funds and liquidity allocation
              Topic 5: Market Risk- Market risk measurement techniques
              • 1. Stress testing and scenario analysis
                • 2. Value at Risk (VaR)
                  - Interest rate, equity, FX, and commodity risk
                  Topic 6: Asset-Liability Management (ALM)- Interest rate risk in the banking book (IRRBB)
                  - Liquidity risk management
                  Topic 7: Risk Management Frameworks- Risk measurement and reporting frameworks
                  - Enterprise risk management principles
                  • 1. Risk governance structure
                    • 2. Risk appetite and tolerance
                      • 3. Risk identification and assessment processes

                        PRMIA PRM Certification - Exam III: Risk Management Frameworks, Operational Risk, Credit Risk, Counterparty Risk, Market Risk, ALM, FTP - 2015 Edition Sample Questions:

                        Question #1

                        In respect of operational risk capital calculations, the Basel II accord recommends a confidence level and time horizon of:

                        • A. 99% confidence level over a 10 year time horizon
                        • B. 99% confidence level over a 1 year time horizon
                        • C. 99.9% confidence level over a 10 day time horizon
                        • D. 99.9% confidence level over a 1 year time horizon
                        Answer: D

                        Explanation: Only visible for TorrentValid members. You can sign-up / login (it's free).

                        Question #2

                        Which of the following is a valid approach to determining the magnitude of a shock for a given risk factor as part of a historical stress testing exercise?
                        I. Determine the maximum peak-to-trough change in the risk factor over the defined period of the historical event II. Determine the minimum peak-to-trough change in the risk factor over the defined period of the historical event III. Determine the total change in the risk factor between the start date and the finish date of the event regardless of peaks and troughs in between IV. Determine the maximum single day change in the risk factor and multiply by the number of days covered by the stress event

                        • A. I, II and IV
                        • B. I and III
                        • C. II and IV
                        • D. IV only
                        Answer: B

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                        Question #3

                        The standard error of a Monte Carlo simulation is:

                        • A. The same as that for a lognormal distribution
                        • B. Zero
                        • C. C
                        • D. Proportional to the inverse of the square root of the sample size
                        • E. None of the above
                        Answer: C

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                        Question #4

                        An investor enters into a 5-year total return swap with Bank A, with the investor paying a fixed rate of 6% annually on a notional value of $100m to the bank and receiving the returns of the S&P500 index with an identical notional value. The swap is reset monthly, ie the payments are exchanged monthly. On Jan 1 of the fourth year, after settling the last month's payments, the bank enters bankruptcy. What is the legal claim that the hedge fund has against the bank in the bankruptcy court?

                        • A. The replacement value of the swap
                        • B. $0, as all payments on the swap are current
                        • C. $6m
                        • D. $100m
                        Answer: A

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                        Question #5

                        Which of the following is not a consideration in determining the liquidity needs of a firm (as opposed to determining the time horizon for liquidity risk)?

                        • A. Off balance sheet items
                        • B. The firm's business model
                        • C. Collateral
                        • D. Speed with which new equity can be issued to the owners
                        Answer: D

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