PRMIA 8010 Operational Risk Manager (ORM) Exam Online Training
PRMIA 8010 Online Training
The questions for 8010 were last updated at Jul 18,2025.
- Exam Code: 8010
- Exam Name: Operational Risk Manager (ORM) Exam
- Certification Provider: PRMIA
- Latest update: Jul 18,2025
Which of the following statements are true:
I. Pre-settlement risk is the risk that one of the parties to a contract might default prior to the maturity date or expiry of the contract.
II. Pre-settlement risk can be partly mitigated by providing for early settlement in the agreements between the counterparties.
III. The current exposure from an OTC derivatives contract is equivalent to its current replacement value.
IV. Loan equivalent exposures are calculated even for exposures that are not loans as a practical matter for calculating credit risk exposure.
- A . II and IV
- B . III and IV
- C . I, II, III and IV
- D . II and III
Which loss event type is the loss of personally identifiableclient information classified as under the Basel II framework?
- A . Technology risk
- B . Clients, products and business practices
- C . Information security
- D . External fraud
The Options Theoretic approach to calculating economic capital considers the value of capital as being equivalent to a call option with a strike price equal to:
- A . The notional value ofthe debt
- B . The market value of the debt
- C . The value of the firm
- D . The value of the assets
A bank prices retail credit loans based on median default rates. Over the long run, it can expect:
- A . Overestimation of risk and overpricing, leading to lossof market share
- B . A reduction in the rate of defaults
- C . Correct pricing of risk in the retail credit portfolio
- D . Underestimation and therefore underpricing of risk in it retail portfolio
In estimating credit exposure for a line of credit, it is usual to consider:
- A . a fixed fraction of the line of credit to be the exposure at default even though the currently drawn amount is quite different from such a fraction.
- B . the full value of the credit line to be the exposure at default as the borrower has an informational advantage that will lead them to borrow fully against the credit line at the time of default.
- C . only the value of credit exposure currently existing against the credit line as the exposure at default.
- D . the present value of the line of credit at the agreed rate of lending.
When compared to a low severity high frequency risk, the operational risk capital requirement for a medium severity medium frequency risk is likely to be:
- A . Zero
- B . Lower
- C . Higher
- D . Unaffected by differences in frequency or severity
Which of the following best describes the concept of marginalVaR of an asset in a portfolio:
- A . Marginal VaR is the value of the expected losses on occasions where the VaR estimate is exceeded.
- B . Marginal VaR is the contribution of the asset to portfolio VaR in a way that the sum of such calculations for all the assets in the portfolio adds up to the portfolio VaR.
- C . Marginal VaR is the change in the VaR estimate for the portfolio as a result of including the asset in the portfolio.
- D . Marginal VaR describes the change in total VaR resulting from a $1 change in the value of the asset in question.
If the marginal probabilities of default for a corporate bond for years 1, 2 and 3 are 2%, 3% and 4% respectively, what is the cumulative probability of default at the end of year 3?
- A . 8.74%
- B . 9.58%
- C . 9.00%
- D . 91.26%
A risk management function is best organized as:
- A . integrated with the risk taking functions as risk management should be a pervasive activity carried out at all levels of the organization.
- B . report independently of the risk taking functions
- C . reporting directly to the traders, as to be closest to the point at which risks are being taken
- D . a part of the trading desks and other risk taking teams
Under the ISDA MA, which of the following terms best describes the netting applied upon the bankruptcy of a party?
- A . Closeout netting
- B . Chapter 11
- C . Payment netting
- D . Multilateral netting
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