COMMERCIAL SECURITIES

What are commercial securities?

• Financial instruments that are issued by governments for public projects

• Shares issued by companies to increase their market value

• Personal loans given to individuals for non-commercial purposes

• Financial instruments that secure obligations

Which of the following is true about a secured loan?

• It does not require collateral

• It gives the lender a claim over specific assets in case of default

• It is unsecured by any property

• It cannot be enforced under Kenyan law

A mortgage loan is governed by which law in Kenya?

• Companies Act, 2015

• Land Act, 2012

• Secured Transactions Act, 2018

• Chattels Transfer Act

What is a pledge?

• A type of unsecured loan

• Transfer of ownership of property

• Transfer of possession of property as security

• A legal agreement to borrow money

Which of the following is NOT a type of lien?

• Judgment lien

• Statutory lien

• Mortgage lien

• Mechanic’s lien

What is a sight bill?

• A bill payable on presentation

• A bill payable at a future date

• A negotiable promissory note

• A secured loan

Which law governs the issuance of unsecured debentures in Kenya?

• Companies Act, 2015

• Secured Transactions Act, 2018

• Bills of Exchange Act

• Chattels Transfer Act

What does the process of perfection in commercial securities involve?

• Transferring the ownership of assets

• Repaying the loan in full

• Filing a legal complaint

• Registering the security interest to make it legally enforceable

What is a major emerging trend in commercial securities?

• Manual documentation of security interests

• Abandoning digital platforms for securities

• Use of blockchain technology for managing securities

• Reducing the role of collateral in lending

In the context of commercial securities, what does the term "priority" refer to?

• The order in which collateral is repossessed

• The order in which claims against collateral are satisfied

• The order in which creditors file their claims

• The order in which a debtor repays their loans