SIV vs SPV please help

wing is NOT a consequence of securitization for the financial Question 12. Which of the following is NOT a consequence institution (FI) that securitize the loans? A. The Fl has a decreased liquidity of assets. B. The Fl has a new source of funds. C. The Fl increases the efforts of monitoring on the securitized loans. D. It decreases the duration of assets for the Fl. E. It decreases the regulation tax that are implicitly paid by the Fl. Question 13. One difference between a Special Purpose Vehicle (SPV) and a Structured Investment Vehicle (SIV) is that the A. SPV is formed by depository institutions and the SIV is formed by non-depository institutions. B. SPV retains ownership of the loans while the SIV sells the loans without recourse so the loan rights are transferred to the investor. C. SPV may have a line of credit or a loan commitment from the sponsoring institution if a loan goes bad and it cannot make payments to investors; the SIV has no such arrangement. D. SIV is just passing cash flows it receives through to the ultimate investor, the SPV has fixed payment obligations that must be met regardless of cash flows received on the loan portfolio E SIV can potentially cam an expected spread between its high-yielding assets and the relatively short-term, low cost funds that it borrows in addition to servicing fees. Question 14. Which of the following statements about SPV and SIV is NOT correct? A. SIV's lifespan is not tied to any particular security, while SPV's life is limited to the maturity of the ABS Unlike SPV. SIV does not simply pass through the payments on the loans in its portfolio to the ABCP investors. C. SPV pays out only what it receives from the underlying loans in the pool of assets backing the ABS. D. SIV is responsible for payments on its ABCP obligations whether or not the underlying pool of assets generates sufficient cash flow to cover these costs. E None of the above Question 15. Which of the following does NOT contribute to the fact before the financial that SIV is a more lucrative model than SPV in general? A. Unlike SPV, SIV investors have no direct rights to the cash flows on the underlying the portfolio If the assets in the underlying pool does not generate sulficient cash flow the SIVI obligated to make interest and principle payments on its debt instruments C SIV'S ABCP obligations carry interest obligations that are independent of the cash now from the underlying loan/asset portfolio while SPV pays out what it receives from the underlying loans in the pool of assets backing the ABS. D. Whereas a SPV cars only the fee for the creation of the asset-backed securities, the SIV cars an expected spread between high-yielding assets and low-cost commercial paper SIV invests in assets that are designed to generate higher returns than the SIV's cost of fund E Question 16. Which of the following are functions of GNMA? A Engaging in swap transactions where it swaps mortgage-backed securities with an Ft for original mortgages B. Sponsors mortgage-backed securities programs by Fis such as banks, thrifts, and mortgage bankers. C. Sponsors mortgage-backed securities programs by Fis such as banks, thrifts, and mortgage bankers and acts as a guarantor to investors in mortgage-backed securities regarding the timely pass-through of principal and interest payments on their sponsored bonds. D. Acts as a guarantor to investors in mortgage-backed securities regarding the timely pass- through of principal and interest payments on their sponsored bonds. D. All of the options. estors in mortgas consored bonds the timely pass Question 17 (Bonus Question, 5 points). Sun Bank has issued a one-year $7.5 million loan commitment to a customer for an upfront fee of 28 basis points and at a fixed rate of 8.5 percent. The back-end fee for the unused portion of the commitment is 13.5 basis points. The bank requires a 10.5 percent compensating balance in demand deposits. Assume that there are reserve requirements of 10 percent on demand deposits. What should be the expected takedown rate by the borrower if the bank requires an expected retum of 9.25 percent? Do not take future values of fees or interest income received A. 1.45% B. 2.05% C. 2.48% D. 53.25% E. None of the above Question 18 (Bonus Question, 5 points). Which of the following statements is NOT correct regarding securitization? A. By securitizing, FI's profitability becomes more fee-dependent than interest rate spreme dependent. B. By securitizing. Fl is actine more like an asset broker than a traditional asset transtore By securitizing, Fl no long has to bear the illiquidity and duration mismatches when it acts as an asset transformer D. By security D ecuritizing. I can downsize their illauid assets and keep a highly liquid but it does not help to enhance an Fi's profits. E None of the above