In the CAMELS Rating System, Which Is Used to Assess

question 61

Multiple Choice

In the CAMELS rating system, which is used to assess the health of the banks, the letter A stands for

• A)accounting practices.
• B)auditing procedures.
• C)analysis of risk.
• D)asset quality.

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Definitions:

Profitability

The ability of a business to generate earnings compared to its expenses and other relevant costs, expressed as a percentage or profit margin.

Short-term Notes Payable

Debt obligations that are due to be paid within a year, often used for working capital purposes or to finance short-term liabilities.

Interest Charges

Costs incurred for borrowing money, calculated as a percentage of the principal amount loaned.

Account Payable

An obligation of a company to pay a short-term debt to its creditors or suppliers.