NAB International Banking 2

Question 1

What does SWIFT stand for in the context of international banking?

Accepted Answer

Society for Worldwide Interbank Financial Telecommunication

Answer

Standard World Interbank Fund Transfer

Answer

Secure Wire International Financial Transmission

Answer

System for Worldwide Interbank Fund Transfers

Question 2

What is a 'nostro' account in international banking?

Accepted Answer

An account a domestic bank holds at a foreign bank in that bank's currency

Answer

An account a foreign bank holds on behalf of a domestic bank

Answer

A multi-currency account used for hedging

Answer

A reserve account maintained at the central bank

Question 3

Which currency pair typically has the highest daily trading volume in the global foreign exchange market?

Accepted Answer

EUR/USD

Answer

GBP/USD

Answer

USD/JPY

Answer

AUD/USD

Question 4

How many characters make up a standard SWIFT/BIC code?

Accepted Answer

8 or 11

Answer

10 or 12

Answer

6 or 9

Answer

8 or 10

Question 5

What is 'vostro' account from the perspective of the correspondent bank holding it?

Accepted Answer

An account the correspondent bank holds on behalf of a foreign bank

Answer

An account held at a central bank for regulatory reserves

Answer

A foreign currency trading account

Answer

An overdraft facility extended to overseas clients

Question 6

What is the primary role of the Bank for International Settlements (BIS)?

Accepted Answer

To serve as a bank for central banks and foster international monetary cooperation

Answer

To provide retail banking services to international travelers

Answer

To regulate SWIFT messaging standards globally

Answer

To manage the IMF's Special Drawing Rights (SDR) allocations

Question 7

Which foreign exchange rate system allows a currency's value to be determined primarily by open market supply and demand?

Accepted Answer

Floating exchange rate system

Answer

Fixed exchange rate system

Answer

Crawling peg system

Answer

Currency board arrangement