Consider the following statements :Statement-I :Syndicated lending spreads the risk of borrower default across multiple lenders.Statement-II :The syndicated loan can be a fixed amount/lump sum of funds, but cannot be a credit line.Which one of the following is correct in respect of the above statements ?

1. A

   Both Statement-I and Statement-II are correct and Statement- II explains Statement-I

   Both correct and II explains I. Statement-II is false: a syndicate can include a revolving credit line.

2. B

   Both Statement-I and Statement-II are correct, but Statement-II does not explain Statement-I

   Both correct but II does not explain I. II is still the false limb.

3. C

   Statement-I is correct, but Statement-II is incorrect

   I correct, II incorrect. Risk is spread across lenders; the facility need not be a lump sum only.

4. D

   Statement-I is incorrect, but Statement-II is correct

   I incorrect, II correct. Syndicated lending does spread default risk.

Summary. The Commission later dropped this item, so there is no official key to mark. Still walk the options. Syndicated lending does spread borrower-default risk across banks. A syndicated facility can be a term loan or a revolving credit line — Statement-II over-claims. Coaching keys (c); WRAP does not stamp Official key on a withdrawn row.