Which of the Following Is an Incentive to Securitize Mortgage

question 97

Multiple Choice

Which of the following is an incentive to securitize mortgage assets?

• A)To reduce the regulatory tax burden on the FI.
• B)To adjust the gap exposure of the FI.
• C)To improve the liquidity of the FI.
• D)To generate non-interest sensitive fee income.
• E)All of these.

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Definitions:

Construction

The process of building, assembling, or forming infrastructure, buildings, or other constructed assets.

Installment Payments

Payments made regularly over a period of time to settle a debt or purchase, often including interest charges.

Convertible Bonds

Bonds that can be converted into a predetermined number of shares of the issuing company's equity at certain times during their life, usually at the discretion of the bondholder.

Bond Redemption

The process whereby a bond issuer returns the bond's principal value to the bondholder, effectively terminating the bond at or before its maturity.