American Bankers Association CRCM Exam - Topic 7 Question 79 Discussion

Actual exam question for American Bankers Association's CRCM exam

Question #: 79
Topic #: 7

For which of the following business activities must a bank holding company obtain prior approval of the Federal Reserve Board?

AOperating an auto club service

BServing as a safe deposit company

COperating as a management consulting firm for financial institutions

DSelling installment loan data processing

Show Suggested Answer

Suggested Answer: B

by Gracia at Dec 27, 2023, 12:58 PM

Limited Time Offer

25%

Off

Get Premium CRCM Questions as Interactive Web-Based Practice Test or PDF

Contribute your Thoughts:

Submit Cancel

Xuan

5 months ago

I thought selling data processing was a free-for-all!

upvoted 0 times

...

Rosina

5 months ago

Safe deposit companies definitely require it.

upvoted 0 times

...

Joana

6 months ago

Wait, do they really need approval for auto clubs?

upvoted 0 times

...

Janae

6 months ago

Totally agree, it's a big deal!

upvoted 0 times

...

Freeman

6 months ago

Banks need approval for management consulting.

upvoted 0 times

...

Vallie

6 months ago

I recall something about safe deposit companies needing approval, but I can't remember if it's specifically for bank holding companies.

upvoted 0 times

...

Margart

6 months ago

I’m really uncertain about this one. I thought all these activities were allowed without prior approval, but now I’m second-guessing myself.

upvoted 0 times

...

Jerrod

7 months ago

I feel like we practiced a similar question about consulting firms and their regulatory requirements. I think that might be the right answer.

upvoted 0 times

...

Franklyn

7 months ago

I think I remember that banks need approval for activities that are closely related to banking, but I'm not sure which one it is here.

upvoted 0 times

...

Jacquline

7 months ago

I'm a little unsure, but I'll give it my best shot and make an educated guess.

upvoted 0 times

...

Louvenia

7 months ago

I remember learning about this in class. I'm pretty confident I know the right answer.

upvoted 0 times

...

Adela

7 months ago

Hmm, I'm not too sure about this one. I'll need to think it through carefully.

upvoted 0 times

...

Kerry

7 months ago

This question seems straightforward, I think I can figure this out.

upvoted 0 times

...

Fletcher

7 months ago

Okay, let me break this down step-by-step. I need to focus on the key details about bank holding companies.

upvoted 0 times

...

Trinidad

7 months ago

Hmm, this one seems straightforward. I think the answer is Downstream, since that's the segment that deals with the retail side of the oil and gas industry.

upvoted 0 times

...

Rolande

7 months ago

Hmm, I'm not totally sure about this one. Is it something to do with the Export Administration Regulations (EAR)? I know those cover commercial and dual-use tech exports.

upvoted 0 times

...

Yun

7 months ago

Wait, aren't both originator ID and cluster ID important in route reflection? I feel like I saw a question similar to this in practice.

upvoted 0 times

...

Fletcher

12 months ago

I bet the Fed is just waiting for a bank to try and start selling used cars. 'Sorry, not on my watch!'

upvoted 0 times

Bettina

11 months ago

C) Operating as a management consulting firm for financial institutions

upvoted 0 times

...

King

11 months ago

B) Serving as a safe deposit company

upvoted 0 times

...

Mable

11 months ago

A) Operating an auto club service

upvoted 0 times

...

Gussie

12 months ago

Wait, they can't just open up a car wash on the side? Talk about diversifying your portfolio!

upvoted 0 times

...

Cassie

1 year ago

C) Operating as a management consulting firm for financial institutions - now that's a curve ball! Definitely not something a bank would do without getting the Fed's okay.

upvoted 0 times

Lavonna

11 months ago

C) Operating as a management consulting firm for financial institutions

upvoted 0 times

...

Agustin

11 months ago

B) Serving as a safe deposit company

upvoted 0 times

...

Valentin

11 months ago

D) Selling installment loan data processing

upvoted 0 times

...

Jade

11 months ago

C) Operating as a management consulting firm for financial institutions

upvoted 0 times

...

Tori

11 months ago

B) Serving as a safe deposit company

upvoted 0 times

...

Chauncey

11 months ago

A) Operating an auto club service

upvoted 0 times

...

Thomasena

12 months ago

A) Operating an auto club service

upvoted 0 times

...

Goldie

1 year ago

D) Selling installment loan data processing is an interesting one. I could see that needing approval, but I'm not totally sure.

upvoted 0 times

...

Shawn

1 year ago

A) Operating an auto club service? That's a bit of a stretch for a bank holding company, don't you think?

upvoted 0 times

Dorathy

10 months ago

Selling installment loan data processing might require approval from the Federal Reserve Board.

upvoted 0 times

...

Refugia

11 months ago

Operating as a management consulting firm for financial institutions could be beneficial for a bank holding company.

upvoted 0 times

...

Latrice

12 months ago

C) Operating as a management consulting firm for financial institutions

upvoted 0 times

...

Arlean

12 months ago

I think serving as a safe deposit company would make more sense for a bank holding company.

upvoted 0 times

...

Lashaunda

12 months ago

B) Serving as a safe deposit company

upvoted 0 times

...

Geraldo

12 months ago

C) Operating as a management consulting firm for financial institutions

upvoted 0 times

...

Stacey

12 months ago

B) Serving as a safe deposit company

upvoted 0 times

...

Kris

12 months ago

I agree, operating an auto club service seems unrelated to banking.

upvoted 0 times

...

Evan

1 year ago

I'm not sure, but I think C) Operating as a management consulting firm for financial institutions might also require approval due to potential conflicts of interest.

upvoted 0 times

...

Krissy

1 year ago

I agree with Joye, because holding deposits is a core banking activity that requires regulatory approval.

upvoted 0 times

...

Joye

1 year ago

I think the answer is B) Serving as a safe deposit company.

upvoted 0 times

...

Justine

1 year ago

B) Serving as a safe deposit company seems like the most likely answer. Banks typically need approval for activities outside their core banking services.

upvoted 0 times