CMA Final Risk Management in Banking and Insurance (Paper 20B)

How to prepare Risk Management in Banking and Insurance

1. Read the syllabus and list all fifteen chapters. Mark each as numerical, descriptive or mixed, so you know where practice matters most.
2. Start with Introduction to Risk Management. Learn the types of risk, the risk management process, and how risk, return and capital relate. Later chapters build on this vocabulary.
3. Work through the banking chapters in order: interest rate, market, credit, NPAs, liquidity, sovereign and insolvency, operational and off-balance sheet risk. For each, write a one-page note on the risk, how it is measured, how it is controlled, and the regulatory expectation.
4. Practise the numerical topics by hand. Cover items such as repricing gap, duration, value at risk, credit exposure and expected loss, asset classification and provisioning, and liquidity ratios. Write each formula in your notes and solve at least five problems per topic.
5. Move to insurance. Cover the business model, intermediaries, general, health and life products, re-insurance structures, and how insurers manage their own risk. Make comparison tables for policy types and re-insurance forms, and learn what each feature means in practice.
6. Use short case scenarios for revision. Take a situation, identify the risk type, name the measure or tool, and state a recommendation in a few lines. This builds the skill Section A part 1(b) and the written questions reward.
7. Solve past ICMAI papers and mock papers for 20B under exam conditions. Do the 15 MCQs first, then five written questions. Review every lost mark and note whether it was a knowledge, calculation or presentation error.
8. In the last two weeks, revise only your one-page notes, formulas and comparison tables. Re-attempt questions you got wrong. Stop learning new topics in the final three days.

Time management in the exam

• →Spend about 35 to 40 minutes on Section A. Do not pause long on any MCQ. Mark doubtful ones and return after finishing the rest.
• →Read the case scenario in 1(b) once for the situation, then read the questions, then scan the case again for the facts each question needs.
• →Choose your five written questions in the first five minutes after Section A. Pick those where you can start immediately and finish a complete answer.
• →Allow about 25 minutes per 14-mark question. Stop when the time is up, move on, and return if you have minutes left.
• →Attempt numerical parts early within each question while you are fresh. Show formula, substitution and result so you earn method marks even if arithmetic slips.
• →Keep the last 10 minutes to check that you have answered exactly five written questions, labelled each part correctly, and not left any MCQ blank. There is no negative marking provided for, so attempt every MCQ.