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Basic Question 0 of 3

Which C is generally not used by commercial banks when they perform sovereign debt credit analysis?

A. Character
B. Collateral
C. Capacity
D. Covenants

User Contributed Comments 8

User Comment
ssradja Interesting. How about covenants?
jmcarr02 How could a country provide collateral... lol! I imagine a banker asking for bunch of road or an administrative building.
CheeHong I would imagine those are good collaterals.
Just that we never knew when the national army will come storming in to seize them back again.
TheHTrader What does Character stand for?
Sailor85 Character is a measure of the borrower's past payment history. In consumer lending, it is normally evaluated by pulling a credit report.
rocyang Poor south americans...
jonan203 well, the tax payers and their future earnings are implied to be the collateral of US debt...
chcarnes unsecured = no collateral!
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Learning Outcome Statements

demonstrate the application of the Code of Ethics and Standards of Professional Conduct to situations involving issues of professional integrity

recommend practices and procedures designed to prevent violations of the Code of Ethics and Standards of Professional Conduct

identify conduct that conforms to the Code and Standards and conduct that violates the Code and Standards

CFA® 2026 Level I Curriculum, Volume 6, Module 3.