CFA Pass Rate Slips Again to Record of 29% for Level II Exam

(Bloomberg) -- The pass rate for the second level of the chartered financial analyst exam plunged to the lowest since the test was first administered nearly 60 years ago.

In August, 29% of candidates passed the Level II exam, down from 40% for those who sat for the exam in May and June, according to the CFA Institute’s website. The 10-year average pass rate is now 45% for that level.

The latest results follow historically low pass rates across all levels of the CFA exam in recent months. The institute continues to cite disruption from the pandemic as a reason for the trend. And as the CFA has shifted to more frequent and digitally administered exams, the number of candidates taking the test in each period has also decreased, which could factor into the lower pass rates. 

“Unfortunately, we are still seeing fewer candidates pass their CFA exams due to the impact of the global pandemic on candidate study timelines,” Peg Jobst, managing director for credentialing at the institute, said in a statement Thursday. “Repeating study plans after an examination deferral is daunting for most students, and this is again borne out in today’s results.”

The Level II exam consists of vignettes with 88 multiple-choice questions and takes about four and a half hours to complete. Passing all three CFA levels can lead to higher salaries and better job opportunities for finance-industry workers. On average, candidates study over 300 hours for each of the three exams and take four years to complete the series.

Read more: CFA Pass Rate Slumps to Record Low as Pandemic Upends Tests

The Covid-19 pandemic upended the normal test-taking timeline in 2020. In the past the institute offered all three levels of the test on paper in June, and another chance to take the first part in December. After transitioning to computer-based testing, the institute now offers the exams more times throughout the year.

More than 10,000 candidates sat for the Level II exam in August, which was administered at 516 computer-based testing centers around the world. That compares to a ten-year average of nearly 500,000 candidates when the test was administered only once a year. 

This year’s Level II pass rate is the lowest on record, with the previous low set at 32%, in 2004. Last week, Level I candidates got their results, with a 26% passing rate for those who took the exam in August. Level III test-takers are set to receive their results on Nov. 2, the institute said. 

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