 Hey guys, it's MJ the students actually and what you're looking at here is an exam that Everybody failed So it was a banking exam. It was the very first banking fellowship exam and just to prove to you that everyone did fail it What I'm showing you here are the past results or the exam results for the November 2015 Examinations for the fellowship subjects in South Africa for for the health fellowship 25 people presented themselves for people past for life insurance 75 percent 75 people present themselves 23 past now remember in order to to write these exams You need to have completed all eight of the core technical subjects All three of the core application subjects and two of the specialist subjects So we're talking about hardcore actuaries having a go at these exams general insurance 31 present themselves only six past 14 present themselves on pensions only four past investments 21 candidates present themselves six past but when it came to the banking exam eight people presented themselves and No one passed so this is going to become a little bit of a legendary Exam in the sense that it's an exam that no one has Well, no one passed so here it is it's the exam that nobody passed And I mean you can see it's it's four pages long unless you got the solutions over here Which are 26 pages so the marking schedule goes 26 pages deep I mean I've looked for the other fellowships and their answers only are 17 pages So it's like 10 more pages. I do think they made they put maybe a little bit more detail to help candidates You know explain the questions a little bit better But yeah, let's go through this exam because I don't know maybe you guys could have passed this exam This is this is the very first question It's for 20 more 24 marks in total. It says you are the head of a retail Credit or what your head of retail credit at a prominent bank in South Africa your portfolio includes credit cards Overdrafts home loans and personal loans for all retail customers One of the responsibilities of your team is to review the provisioning results obtained from the centralised area That calculates the provisioning requirements monthly Now you need to explain why a bank should raise credit provisions Why it is important to determine the value of credit provisions accurately and what type of credit provisions exist? I Actually don't even know where I would start with that question Then for eight marks over the last quarter You have noticed that the provisions held for the retail credit card and overdraft portfolio have increased significantly in ran terms Please see the table below. So that's over here For recent financial information Explain how you would evaluate and compare these results include details how you would establish possible causes for the results in your answer Then they also give you some more information here And you have to explain how you would validate the suggestion include different courses of action available to the bank in your answer Wow, I mean, that's just question one Question two you're a multinational bank Calculate the economic capital requirement for the following year with the probability of adequacy of 99.9 percent That the company has in what the company has internal control frameworks that allow to identify and quantify the risk to which it is exposed And there's a whole bunch of wow, yeah, this is You can see why no one passed this exam. I mean, I'm just looking through this and it's It's quite insane liquidity coverage ratio net stable funding ratio. I mean the scary thing is I I kind of qualify to write this exam. I mean if we come if we jump to the syllabus Is in order to write this fellowship exam They recommend that you have specialized in subject f106 and in f105 Which is finance and enterprise risk management. These are two subjects, which I have passed Yet I went through that paper. Look, I haven't studied banking or anything But you know, I've got the groundwork and I didn't understand the questions and even know where to start F105 this is like subject st5 and f106 is like subject st9 for people with the English exams Yeah, so Africa's confused everyone by giving the exams different different names But I mean just look at the the syllabus that you need to know You need to demonstrate knowledge and understanding of the operations of a banking institution in South Africa I mean you look here and this is just what you need to know for the very First part of the syllabus. I mean check out all those different risks. Okay All of that is you could almost write a book on each of these things I mean outline the various sources of funds that bank used to fund the operations including deposit taking wholesale marketing Central bank funding tier one tier two capital Then there's all these other various risks and that's just part one I mean as you can see there is part two Demonstrate knowledge and understanding of typical corporate governance structure of a banking operation in South Africa There's a whole bunch of stuff over there. Then it goes on to page three I don't know if we should go through this entire syllabus because it is quite depressing I mean it's highlighting all these things that I don't actually know Demonstrate knowledge and understanding of the role of a risk management in a banking operation Demonstrate knowledge and understanding of the credit risk measurement framework in a banking operation Um, okay, that's the fact. I mean we did in the the previous f106 So that's not too bad. But I mean just the mere quantity of stuff that you need to know For this exam I mean and that's also the thing is no one had any past past papers. Um to help them out with this so Yeah Zero zero percent of the people passed it in November Although they did write the exam again now in June and four people passed So the June paper that was written this year has been passed. So I don't think this the subject is You know totally impossible to do But this this very first exam Had a pass rate of zero percent and if i'm correct I think South Africa is the only country in the world That offers the banking uh fellowship. No other country does that I mean South Africa is one of the the leading countries when it does come to to banking We're very innovative. Um, you know, we're very good with financial services And y'all I mean check this is part eight. I mean this this list just goes on And on I mean market lockout funding concentration regulatory PRA metrics What something ratio? I mean this is this is intense So now why I'm actually going through this is because I need to choose which fellowship I should do Should I do this banking fellowship? Which looks like alien language? Or do I go with the the finance fellowship? So I'm reading through both of these Both of these syllabuses And I'm leaning towards finance Who knows maybe when I pass finance, I'll write this one as well Um, although I must say some of the stuff does look quite interesting I mean demonstrate knowledge and understanding of the liquidity risk management framework and process in banking operations I mean, I enjoy banking. Um, I'm very excited to see how blockchain and bitcoin You know, because that's a big threat to the banking industry You know, how how are they going to handle it? Could you automate this entire banking process? I mean these are some interesting questions And I mean banking is it's almost like, yeah, it's a trillion dollar industry So if you crack if you crack the code of banking or you understand this Then, yeah, then like the Illuminati will be like, hey bro come come join us at our round table You know come come take a seat If you can understand all this type of stuff But when you check we into part 12 demonstrate knowledge and understanding of a typical corporate governance structure for a commercial banking Including one in South Africa. I mean, wow, they need more full stops around there Um, demonstrate knowledge and understanding of bank strategy setting and implementation process Oh, that could be quite fun. What does this have? Stakehold expectations risk appetite? Organizational structure resource capacity Um, I think this is the final one. Yeah discuss and analyze various case studies the pitfalls of risky liquidity Um And so forth So, yeah, this this has been this is the marking schedule, but jam I don't want to go. I think this video already is too too long and it's me rambling on about an exam Um, yeah, I mean, yeah, this is just what so for that very first question This is what you had to to write you had to write all that. Wow. That's a lot of stuff to write In just three hours Um Yeah, what yeah, I can see what the examiner said this question was very poorly answered Candidates failed to construct a table of summary ratios by product Which meant that their answers were generally unstructured and failed to cover all the points Candidates also failed to comment on the fact that the increase in provisions are very large in light of short periods There's past since the previous calculation Better candidates consider the state of the economy and that unsecured products react faster Some went on to comment on home loans and personal loan products whoo No, this is this is when you're not messing around. I mean, you know, they're once you've reached the fellowship level that you know, this is this is These this is exams, you know for for experts people who are used to studying who probably working in the industry Um, probably a little bit older than us. I mean these exams are are serious business But um, but sure there we go. I just wanted to go through this exam with you guys This is An actuarial exam that nobody passed. So maybe go go download it. I mean just type in f 206 Actuarial Society of South Africa Downloaded have a look at it. See if you can if you can attempt it I mean, they have given you the solutions as well So you can check your solutions and let me know in the comment section below if you wrote this exam and if you passed it um Because yeah, it is it is the impossible exam, but thanks guys so much for watching Watching watching apologies for that. Um, I am going to be making some more videos around finance and my adventures in studying for the fellowship. So yeah, check out Oh, yeah, look out for those and sorry, I'm talking gibberish now. It's because I'm hungry. So let me go and eat But yeah, thanks guys so much for watching. Cheers