Making a Lending Decision to a Party Residing in a Foreign

question 43

Multiple Choice

Making a lending decision to a party residing in a foreign country is a two-step decision.What are the two steps involved in such a decision?

• A)Assessing credit quality of the borrower and sovereign risk quality of the borrower's country.
• B)Assessing political economy risk and exogenous risks.
• C)Assessing sovereign risk quality of the borrower's country and other country risks.
• D)Rescheduling of existing loans and deciding on the terms for new loans.
• E)Assessing the foreign exchange risk involved and the security that can be provided by the borrower.

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Definitions:

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