Part II has fewer questions than Part I, 80 in four hours, but each one asks you to apply the Part I tools to a risk problem, across six topic areas. In November 2025, 50% of Part II candidates passed.
Questions
80, equally weighted
Time
4 hours
Format
Multiple choice, computer-based
2027 windows
May, August and November
Pass rate, November 2025
50%
What makes it hard
Application: GARP says Part II focuses on applying the tools from Part I, so a question often joins two steps, such as a VaR figure and a capital rule.
Breadth: six topic areas, from backtesting and CVA to the LCR, operational risk capital, performance attribution and current issues.
No formula sheet: the formulas and regulatory ratios have to be known by heart.
Pace: 80 questions in 240 minutes is 3 minutes a question, with the calculation included.
What makes it easier
Most candidates arrive having passed Part I, so the statistics, VaR, bond and option tools are already familiar. Every question counts the same, and many are short concept questions on how risk is measured, managed and regulated.
The timing rule to know
You can sit Part II before your Part I result only in the same window as Part I, and a Part II paper is graded only if Part I is passed. After passing Part I, you have until December 31 of the fourth year to pass Part II.
Try 4 questions
Question 1Estimating VaR and expected shortfall: historical, weighted and parametric
To estimate the 95% expected shortfall, a risk manager splits the 5% tail into five equal slices and computes the VaR at the midpoint of each: $2.10 million at 95.5%, $2.31 million at 96.5%, $2.55 million at 97.5%, $2.88 million at 98.5% and $3.46 million at 99.5%. The 95% VaR itself is $1.70 million. The 95% expected shortfall is closest to:
Question 2Credit spreads, credit default swaps and spread risk
A five-year CDS on a distressed name trades with a standard running coupon of 100 basis points, while the par spread is 350 basis points. The risky duration (risky annuity) of the contract is 4.0. For $20 million notional, the upfront payment from the protection buyer is closest to:
Question 3Asset-liability management: repricing and duration gaps
A bank has assets of $800 million with a duration of 3.5 and liabilities of $720 million with a duration of 1.5. The duration of its equity, (DA x A - DL x L) / E, is closest to:
Question 4Alpha, benchmarks and the fundamental law
A long-only manager has an information coefficient of 0.06 on 256 independent bets a year. Because of the long-only constraint, the transfer coefficient is 0.6. Under the generalized fundamental law, IR = TC x IC x √(breadth), the expected information ratio is closest to:
It is different: fewer questions (80 against 100) in the same four hours, but each applies the Part I tools to a risk management problem across six topic areas. In November 2025, 50% passed Part II and 47% passed Part I.
What is Part II about?
GARP says Part II focuses on applying the tools acquired in Part I: market, credit, operational, liquidity and treasury risk, risk management in investment management, and current issues in financial markets.
How long do I have to pass Part II?
GARP's exam policies say Part II must be passed by December 31 of the fourth year after passing Part I.