10 exam-style questions with answers and explanations, straight from our 1,030-question bank. Tap an answer to check yourself. When you're ready, take the scored version in the free practice test.
These 10 free CCBRS questions are organized by exam domain, so you can see how each part of the Certified Community Bank Risk Specialist blueprint is tested. Reveal the answer and explanation under each question.
The compliance department designs a consumer-disclosure monitoring program, challenges exceptions, and reports results to the board. Branch management argues that compliance now owns the risk of delivering inaccurate disclosures. Under the Three Lines Model, who retains responsibility for the branch process and its day-to-day controls?
Correct answer: B - Branch management, supported and challenged by compliance.
Stress analysis shows that a bank could absorb losses materially larger than those allowed by its board-approved risk appetite. The chief executive says, 'Our loss-absorbing capacity gives management room to take that extra risk without changing the appetite statement.' What distinction does this proposal overlook?
Correct answer: C - Capacity concerns what the bank can bear; appetite concerns what it is willing to accept.
After market rates rise, borrowers in a bank's fixed-rate mortgage-backed securities refinance less often. Principal returns more slowly, leaving the bank invested at below-market yields for longer than projected. Borrowers continue to pay as agreed. What explains the changed cash-flow pattern?
Correct answer: C - Option risk expressed as slower prepayments and extension of the investment.
Credit review finds that a borrower's operations and pledged assets are unlikely to repay its loan in full. A guarantor's pending asset sale could materially improve recovery and should be resolved shortly. Full collection remains highly improbable, but the pending sale prevents a reliable final loss estimate; no portion is yet identifiable as uncollectible. Select the supervisory classification that fits this situation.
Correct answer: B - Doubtful.
A savings platform places fully insured balances for thousands of unrelated customers. Under their account agreements, one program manager can move all the balances to another bank on the same day. Treasury calls the funding diversified because no individual customer has a large balance. To capture the common withdrawal control, which grouping belongs in the bank's funding-concentration report?
Correct answer: D - Aggregate balances subject to the program manager's withdrawal decision, including insured accounts.
At 9:00 a.m., an FDIC-supervised bank determines that a ransomware incident has materially disrupted account access and payment services for a material portion of its customers. Responders are containing the attack; restoration is expected later that day. Investigators have not found evidence of customer-data theft. The incident commander asks when the FDIC must be notified. Which instruction is correct?
Correct answer: D - Notify as soon as possible, and no later than 36 hours after the bank's determination.
A storm temporarily closes a motel financed by the bank, leaving the owner unable to make the next scheduled loan payments. The owner requests a short payment deferral. Verified insurance proceeds, funded repairs, and a supported reopening forecast show that the proposed schedule is feasible and full collection remains expected. Within its delegated authority, how should the credit committee respond?
Correct answer: A - Approve a documented accommodation supported by the repayment analysis and follow-up monitoring.
For the first six months of the year, a bank reports $10.8 million of interest income, $4.8 million of interest expense, and $1.2 million of service-charge income. Average earning assets are $400 million; average total assets are $500 million. All interest income is taxable. The board's annualized net interest margin minimum is 2.80%. Using a factor of two to annualize this six-month period, which dashboard entry is accurate?
Correct answer: A - 3.00%; the margin meets the board's minimum.
An independently validated machine-learning score performs well for the bank's salaried consumer borrowers. Management proposes using it to approve loans to self-employed applicants, who were absent from both the development and validation samples. A functioning manual underwriting process is available for those applicants, and no weakness has been found in the score's existing approved use. How should the risk manager handle the proposed expansion?
Correct answer: B - Retain manual underwriting for the new group while assessing the score's suitability for that use.
Before an acquisition, Bank A has $120 million of loans in a particular industry and $60 million of total risk-based capital. Bank B has $90 million in that industry and $40 million of total risk-based capital. The transaction will leave the combined bank with all $210 million of those loans and $70 million of total risk-based capital after all adjustments. Its approved industry limit is 275% of that capital. What concentration should directors use when evaluating the transaction?
Correct answer: D - 300%; use post-acquisition exposure and capital; the limit is exceeded.
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