GARP Financial Risk and Regulation (FRR) Series 2016-FRR Question # 106 Topic 11 Discussion

GARP Financial Risk and Regulation (FRR) Series 2016-FRR Question # 106 Topic 11 Discussion

2016-FRR Exam Topic 11 Question 106 Discussion:
Question #: 106
Topic #: 11

To safeguard its capital and obtain insurance if the borrowers cannot repay their loans, Gamma Bank accepts financial collateral to manage its credit risk and mitigate the effect of the borrowers' defaults. Gamma Bank will typically accept all of the following instruments as financial collateral EXCEPT?


A.

Unrated bonds issued and traded on a recognized exchange


B.

Equities and convertible bonds included in a main market index


C.

Commercial debts owed to a company in a form of receivables


D.

Mutual fund shares and similar unit investment vehicles subject to daily quotes


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