Finastra Assessment Treasury and Capital Markets Questions and Answers

Question 1

A corporate treasury department is seeking to implement a new Treasury Management System (TMS). Which of the following is a primary benefit they can expect from this implementation?

Accepted Answer

Enhanced visibility into global cash positions and automated financial risk reporting.

Answer

A Treasury Management System (TMS) is designed to centralize and automate a company's financial operations. Key benefits include providing real-time visibility into cash positions across the entire organization, automating routine processes, and improving financial risk management through integrated reporting and analytics.

Question 2

In a repurchase agreement (repo), what is the primary role of the securities involved in the transaction?

Accepted Answer

To act as collateral for what is effectively a short-term, secured loan.

Answer

A repurchase agreement, or repo, is a form of short-term borrowing where one party sells securities to another and agrees to repurchase them at a later date at a slightly higher price. The securities act as collateral for the loan, protecting the lender against default by the borrower.

Question 3

A bank utilizes Finastra's Fusion Kondor for its treasury operations. Which of the following activities is a core function supported by this solution?

Accepted Answer

Executing and managing foreign exchange (FX) and derivatives trades from front to back office.

Answer

Finastra's Fusion Kondor is a comprehensive front-to-back treasury and capital markets solution. It is designed to handle trading, risk management, and processing for a wide range of financial instruments, including foreign exchange, money markets, derivatives, and fixed income.

Question 4

What is the primary function of a Central Counterparty (CCP) in capital markets?

Accepted Answer

To mitigate counterparty credit risk by becoming the buyer to every seller and the seller to every buyer.

Answer

A Central Counterparty (CCP) is a financial market infrastructure that interposes itself between the two sides of a trade, becoming the legal counterparty to both. This process, called novation, significantly reduces counterparty risk because the CCP guarantees the settlement of the trade even if one of the original parties defaults.

Question 5

A regional bank wants to streamline its core treasury operations, covering everything from deal inception to settlement and accounting for instruments like FX, loans, and deposits. Which Finastra solution is specifically designed as a front-to-back office system to achieve this?

Accepted Answer

Fusion Opics

Answer

Finastra's Fusion Opics is a front-to-back office solution that covers all aspects of a bank's treasury operations, from deal inception through to settlement and accounting. It is designed to handle various financial instruments, including foreign exchange, deposits, and loans, with a focus on straight-through processing (STP).

Finastra Assessment Test Practice Test

Finastra Assessment Test Practice Test

Finastra Assessment Treasury and Capital Markets Questions and Answers