UCE 670 CAREER RISE PATH 2026 FULL
CASE EXAMPLES WITH SCORES LIST
◉ "A bank has a loan to a business secured by accounts receivable
and inventory. The business is defunct and management cannot locate
the borrower or the collateral. The loan is now 150 days past due.
Which statement is true?
A. The loan is doubtful until the bank can establish the value of the
accounts receivable and inventory.
B. The loan is a loss and should be charged off.
C. The loan should be rated substandard until the borrower is found.
D. The loan should be placed on non-accrual.
". Answer: B - The loan is a loss and should be charged off.
◉ "National banks cannot take their own bank stock as collateral for
a loan.
A. True
B. False
". Answer: A - True 12USC83
◉ "Which is not a method of logical security?
A. Identifies authorized users
,B. Controls access
C. Monitors unauthorized activity
D. Environmental controls
E. All are methods of logical security.
". Answer: D - Environmental controls. Environmental controls are a
method of physical controls.
◉ "Fiduciary assets are permitted to be commingled with bank
assets.
A. True
B. False". Answer: B - False per 12CFR9.13(b)
◉ "Which of the following are components of Tier 1 capital?
A. Surplus
B. Undivided Profits
C. Non-cumulative perpetual preferred
D. All of the above are in tier 1 capital.
". Answer: D - All of the above are in tier 1 capital.
◉ "The bank makes a loan for $2,000,000 to Customer A to buy into
a partnership. The partnership has borrowings of $3,000,000
outstanding and an additional legally binding commitment of
,$1,000,000. Assume the Legal Lending Limit is $4,500,000. Is the
loan to Customer A in violation?
A. Yes
B. No
". Answer: A - 12 CFR 32.5(e)(2) requires loans made to the member
to purchase an interest in the partnership to be added to the
partnership's loans for LLL purposes.. In this case the loan to
Customer A would be the illegal extension of credit.
◉ "Which of the following loans or extensions of credit are not
subject to the lending limits?
A. Loans to leasing companies
B. Loans secured by real estate
C. Banker's Acceptances
D. A & C
E. B & C
". Answer: D
◉ "Documentation on all loans to executive officers must include a
call provision.
A. True
B. False
". Answer: A - 12 CFR 215.5(d)(4)
, ◉ "10. Director Jones is a director and shareholder of a closely held
community bank. If Jones uses some of his stock as collateral on
loans at another bank does he have to make any special reports?
A. No, it is his stock and where he pledges it is no one's business;
B. He must report it only if he borrowed money for business
purposes;
C. He must report the outstanding amount of the credit to his board
annually;
D. He must report it to his board only if the amount is greater than
$10M.
". Answer: C - 12 CFR 215.12
◉ "11. The aggregate amount of covered transactions with an
affiliate is limited to ____% of member bank capital.
A. 5%
B. 10%
C. 15%
D. 25%
". Answer: B
◉ "12. The aggregate amount of covered transactions with all
affiliates is limited to ____% of member bank capital.
A. 100%
B. 50%
CASE EXAMPLES WITH SCORES LIST
◉ "A bank has a loan to a business secured by accounts receivable
and inventory. The business is defunct and management cannot locate
the borrower or the collateral. The loan is now 150 days past due.
Which statement is true?
A. The loan is doubtful until the bank can establish the value of the
accounts receivable and inventory.
B. The loan is a loss and should be charged off.
C. The loan should be rated substandard until the borrower is found.
D. The loan should be placed on non-accrual.
". Answer: B - The loan is a loss and should be charged off.
◉ "National banks cannot take their own bank stock as collateral for
a loan.
A. True
B. False
". Answer: A - True 12USC83
◉ "Which is not a method of logical security?
A. Identifies authorized users
,B. Controls access
C. Monitors unauthorized activity
D. Environmental controls
E. All are methods of logical security.
". Answer: D - Environmental controls. Environmental controls are a
method of physical controls.
◉ "Fiduciary assets are permitted to be commingled with bank
assets.
A. True
B. False". Answer: B - False per 12CFR9.13(b)
◉ "Which of the following are components of Tier 1 capital?
A. Surplus
B. Undivided Profits
C. Non-cumulative perpetual preferred
D. All of the above are in tier 1 capital.
". Answer: D - All of the above are in tier 1 capital.
◉ "The bank makes a loan for $2,000,000 to Customer A to buy into
a partnership. The partnership has borrowings of $3,000,000
outstanding and an additional legally binding commitment of
,$1,000,000. Assume the Legal Lending Limit is $4,500,000. Is the
loan to Customer A in violation?
A. Yes
B. No
". Answer: A - 12 CFR 32.5(e)(2) requires loans made to the member
to purchase an interest in the partnership to be added to the
partnership's loans for LLL purposes.. In this case the loan to
Customer A would be the illegal extension of credit.
◉ "Which of the following loans or extensions of credit are not
subject to the lending limits?
A. Loans to leasing companies
B. Loans secured by real estate
C. Banker's Acceptances
D. A & C
E. B & C
". Answer: D
◉ "Documentation on all loans to executive officers must include a
call provision.
A. True
B. False
". Answer: A - 12 CFR 215.5(d)(4)
, ◉ "10. Director Jones is a director and shareholder of a closely held
community bank. If Jones uses some of his stock as collateral on
loans at another bank does he have to make any special reports?
A. No, it is his stock and where he pledges it is no one's business;
B. He must report it only if he borrowed money for business
purposes;
C. He must report the outstanding amount of the credit to his board
annually;
D. He must report it to his board only if the amount is greater than
$10M.
". Answer: C - 12 CFR 215.12
◉ "11. The aggregate amount of covered transactions with an
affiliate is limited to ____% of member bank capital.
A. 5%
B. 10%
C. 15%
D. 25%
". Answer: B
◉ "12. The aggregate amount of covered transactions with all
affiliates is limited to ____% of member bank capital.
A. 100%
B. 50%
