Sustained Credit Quality Problems Can Drain an FI's Capital and Net

question 18

True/False

Sustained credit quality problems can drain an FI's capital and net worth.

---

Definitions:

Preferred Share

A type of stock that gives holders priority for dividend payments and assets in the event of a company's liquidation but typically does not have voting rights.

Par-value Share

A stock with a face value as specified in the corporate charter beyond which it cannot be sold upon initial offering.

Non-par-value Share

Shares issued without a nominal or face value, with their selling price determined by the market or by the issuing company.

Distinguish

To recognize or treat as different; to make a clear separation between two or more things.