One Liner Jaiib PPB Paper 1 PDF

TEACH YOURSELF - JAIIB
ONE LINER APPROACH BOOK ON JAIIB -1

(RECALLED & EXPECTED QUESTIONS)
PRINCIPLES & PRACTICES OF BANKING

( JAIIB PAPER -1)
(For 12.11.2017 Examination.)
Sanjay Kumar Trivedy

sktrivedyiibf@gmail.com / 9987519725
Preface
Dear Friends,
The Globalization has opened up World Economy & the distances between Buyer & Seller are reduced
considerably. The other effect which is witnessed in this scenario is banking. Hitherto, to maintain Bank
account /to operate account, the customer had to visit Branch frequently. This is now reduced as
Customer can open account Online, get Statement of account online & request for Cheque book on line.
He has to visit Bank branch only for submitting KYC Documents & other documents.
Indian Banking is in its most exciting phases. The impact of liberalization has been wide spread and has
thrown up both challenges and opportunities for bankers. Ever increasing competition is a part of
professional life and the banker who is ahead of his peers in terms of knowledge skill, technology and
quick response will be the winner.
Banking/Financial sector in our country is witnessing a sea change and banker’s business has become
more complex & difficult in this driven era of knowledge & technology. There are mass retirements
happening due to superannuation & many new recruits are joining the Bank. More than 60% staff
strength is newly recruited in last five to six years.
An official working in the Banking sector has to keep pace with Updated knowledge, skills & attitude, as
the same is required everywhere. Employees play vital role in Banking/service organizations and they
need to be transformed into Knowledge Assets to remain competitive in the dynamic environment and it
is more so with Banks as they are very service sensitive. Thus it is imperative for the bank staff to serve
the clientele with updated information of bank's products & services to accomplish corporate objectives.
This book titled “TEACH YOUR SELF – JAIIB : One Liner- Book” –in the form of question- answer is first
version and consists of all topics as per latest syllabus required for JAIIB examination Nov 2017.This
Book is divided into six Modules namely A, B, C , D, Memory based questions & Practice Teat Papers /
Test Yourself based on latest IIBF syllabus for JAIIB for exam. Nov. 2017. It has been seen that last so
many years in JAIIB/IIBF Examination, nearly 75-85% questions are very general in nature and in this
regard this book is of immense use.The book is prepared based on last more than 15 years of experience
and pattern of questions asked in the examination.
All possible care is taken to provide error free information, however, readers may note that the
information given herein is merely for guidance/reference and they need to refer the relevant circulars
& Manuals for full details.Latest data is given on page no. 53 so please make a note for it.
I express my sincere thanks to friends/colleagues for their support in encouraging the idea and
contributing the required resources for release of this TEACH YOUR SELF – JAIIB-1: One Liner Book.
I solicit your views on the content and quality of the topics for further improvement.
I wish you all the Success and hope the study material will help in achieving the goal.
Date: 08.11.2017 Sanjay Kumar Trivedy

sktrivedyiibf@gmail.com / 9987519725
Compiled by Sanjay Kumar Trivedy, Chief Manager, Canara Bank, Shrigonda,Ahmed Nagar, Maharashtra 1|Page
About the Author
Mr. Sanjay Kumar Trivedy (Native : Motihari, Bihar), Presently working as Chief Manager ( Scale-IV) in
Canara Bank, Shrigonda branch in Ahmednagar distt. of Maharashtra state. He Joined Canara Bank as
DRO/PO (AEO) on 10.03.1997 and and worked in various places, starting from Maujgarh branch (1997-
2000), Near Abohar(Punjab), Sirsa Main- Haryana (2000-2004), BMC, Jalandhar (2004-2006) Toiladungari,
Sakchi, Jamshedpur(2006-2009), Jhalak near Chaibasa (2009-2011), J B Nagar, Andheri East , Mumbai
( 2011-2013) and then Faculty as well as College in charge ( Principal ) in Regional Staff Training College,
Mumbai (2013-2016), Govt.Link Cell, Nagpur (01.05.2016 to 15.07.2017), Itwari Branch, Nagpur
( 17.07.2017 to 15.09.2017 ) and then Shrigonda Branch ( Since 16.09.2017…. ).He won more than 200
awards in various fields of Banking by his Bank – Canara Bank, which includes twice gold coin for CASA
mobilization. His best achievement was as an officer/AEO, he converted his Section: Agril Finance into
Hi-tech Agril. Branch at BMC, Jalandhar and while working in Jhalak branch near Chaibasa (Jharkhand),
won twice best Rural banker award from NABARD during 2009-10 &2010-11 in SHG credit linkage &
Farmers Club Formation. During this journey started from 1997 to till date he worked in almost all area
of Banking.
Mr. Sanjay Kumar Trivedy is M.Sc. (Agril), CAIIB, PGDCA, MBA, MBA (Finance),Diploma (IIBF) in Rural
Banking, Treasury, Investment and Risk Management, Commodity Derivatives for Bankers, Advanced
Wealth Management, Certificate (IIBF) in Trade Finance, Certificate in Anti-Money Laundering / Know
Your Customer, Certificate Examination in SME Finance for Bankers, Certificate Examination in Customer
Service & Banking Codes and Standards, Certificate Examination in CAIIB - Elective Subjects ( Retail
Banking & Human Resource Management) & Certificate Examination in Microfinance
Mr. Sanjay Kumar Trivedy has teaching experience of more than 16 years, from Sirsa Main Branch (2000-
2004) , he started teaching to his colleagues/staff and in this long journey he has given good results both
in Promotion test as well as JAIIB /CAIIB examination. He has taken IIBF-JAIIB & CAIIB classes at Mumbai.
He has compiled/authored more than 20 books in last three years related banking - JAIIB, CAIIB, Book on
Promotion Test ( all cadres), Interview , Drishti (Current Banking Topics –Interview book for Scale iv &
above), Group Discussion, Certificate course on Customer Service & BCSBI, AML& KYC, MSME Finance for
Bankers, Book on Abroad Posting, Confirmation Test for PO, Banking & Technology and many more books
on day today banking and many more in the offing.
Mr. Sanjay Kumar Trivedy is working in a mission mode to reduce knowledge gap among bankers with
objective to provide educational support free of cost to all in general and bankers in particular with
objective to empower Banker colleagues specially young banker who join the bank in last more than one
decade for their better productivity, Sense of satisfaction, Customer delight with ultimate increase of
quality banking business for their organisations.
He can be only contacted through e-mail: sktiibf@gmail.com & whatsapp no. : 9987519725
The best way to find yourself is to lose yourself in the service of others - Mahatma Gandhi
INDEX
SI. CONTENTS Page No.
No
1 MODULE : A ( INDIAN FINANCIAL SYSTEM) 04-14
2 MODULE : B ( FUNCTIONS OF BANKS ) 14-40
3 MODULE : C ( BANKING TECHNOLOGY ) 40-49
4 MODULE : D ( SUPPORT SERVICES ) 49-52
5 MEMORY BASED RECALLED QUESTIONS 53-57
6 TEST YOUR SELF : MODEL PRACTICE TEST PAPERS 58-65
There are certain breakthrough moments when you began to think & See the field differently
1. MODULE – 1 : FINANCIAL SYSTEM
MEMORY BASED RECALLED QUESTIONS
BASEL
01. A subordinate debt with remaining maturity of 30 months will be taken as part of Tier II capital at a discount of: 60%
02. An exposure is called Retail Exposure as per implementation of Basel II, if it is not more than:5 crore.
03. As per Basel II, banks are required to bring capital for __risk in addition to capital for credit risk and market risk: Operational risk
04. As per BASEL III Guidelines, the Loans guaranteed by State Govt will attract Risk weight of: (i)20% (ii) 50% (iii) 100% (iv) 75% (v)
0%: 20%
05. As per BASEL III, what is the risk weight on exposure to Govt securities issued by Central Government?: 0%
06. As per Basel-II, RBI has recommended adoption of __approach for operational risk : basic indicator approach
07. BASEL Accords are related to: Capital Adequacy.
08. Basel II consists __Pillars and number 2 pillar is __ : 3 pillars, Supervisory Review is Pillar no.2
09. Basel II norms to be completed by Foreign banks and banks having foreign branches by 31,03.2008.
10. For banks which do not have overseas braches, Basel II norms have to be implemented with effect from: 31.3.09
11. For being part of Tier II capital, Rupee Denominated subordinated debts should have minimum maturity period of and maximum
maturity period of : Minimum maturity:5 years Maximum: Perpetual(no maturity prescribed
12. In Basel II, Pillar I covers which types of risks: Credit Risk, Market Risk, Operational Risk.
13. Subordinate Debts are part of: Tier-II capital
14. Supervisory Review according to which Central Bank of the country is to ensure that proper capital has been provided for risk
exposure and maintain proper system for the same is provided under?: Pillar II of Basel IL
15. The minimum capital adequacy ratio implemented in India, by RBI is __% and as per Basel II recommendations it is __ % : 9%, 8%
16. The objective of the Pillar III as per BASEL-II is ____: Market discipline through public disclosures
17. The revaluation reserves as per Balance Sheet of a bank is Rs 200 lakh. How much of it will be taken as part of Tier II capital?: Rs
90 lakh (Revaluation Reserve are taken as part of Tier II capital at 55% discount)
18. Under BASEL II, for calculating capital for Operational Risk which method is to be applied for the time being: Basic Indicator
Approach
19. Under BASEL-II, what is the Risk Weightage on the Loans and advances given to Staff of the bank secured by Mortgage /
superannuation benefits: 20%
20. Upper Tier 2 -minimum maturity is 15 years for Debt capital
21. What is the date for final implementation of Basel III? 31.03.2019.
22. Which of the following is part of Tier II Capital? (a) Statutory Reserves (b) Other disclosed reserves (c) Capital reserves from
sale of assets (d) Revaluation Reserve: Ans is D i.e. Revaluation Reserve.
23.
RISKS
01. ALM not responsible for: achieving budgets and targets (it helps in managing liquidity risk and interest rate risk).
02. At present banks are required to maintain capital adequacy ratio of 9% and Tier II capital should not be more than Tier I. It
means that banks are required to bring Tier I capital of at least 4.5% of the risk weighted assets. With effect from which date,
banks will be required to bring Tier I capital of 6% of the risk weighted assets?: 31't March 2010.
03. Documents not stamped properly is what kind of risk?: Legal Risk
04. For calculation of capital adequacy ratio, the risk weight for Commercial Real Estate for commercial bldg is : 100%
05. For capital adequacy purposes, risk weight for personal loans is : 125%
06.Fraud – what type of risk : Operational risk
07. General Insurance works on principle of: Spreading the Risk.
08. If an Outsourcing agency does not serve properly – which type of Risk is faced by the bank?: Reputation Risk and Operational
Risk
09. Investment in perpetual bonds is risky because: the interest is not payable if the CRAR falls below the stipulated target.
10. Legal risk is part of: operational risk.
11. Loss due to inadequacy or failure of system, process, people or due to external events is called: Operational risk
12. Risk weight for claim on Banks which complies to Min CRAR requirement : Scheduled Banks 20%
13. Risk weight for exposure to Scheduled Commercial Bank that maintains CRAR as per RBI requirement: 20%
14. Sub-prime is an risk. (Operational and Credit Risk)
15. The capital adequacy ratio is computed by the following formula: Capital/Risk Weighted Assets
16. Tier 2 - general provisioning & loss reserves only up to 1.25% of total risk weighted assets.
17. Tier I should be at least 6% of Risk weighted assets and should be achieved before by all scheduled commercial banks:
31.3.2010.
18. What are the components of credit risk?: Transaction risk or default risk and portfolio risk
19. When does liquidity risk arises?: Liquidity risk arises when maturing liabilities are more than maturing assets-
20. While doing Risk Rating, an asset is downgraded from A+ rating to A rating. What type of risk is involved: Credit Risk.
MISC
181. ______is a money market instrument, which enables collateralized short term borrowing through Govt. securities: Repo
Rate.
182. While issuing DD of Rs.50,000/- and above what should not be accepted: By cash
183. ˜Bhartiya Mahila Bank is a) Nationalized bank, b) Gramin bank, c) Public sector bank, d) Private bank: Public Sector Bank
184. ˜Call Money market refers to the market for short term funds ranging from _____: Overnight funds
185. ˜In Ultra Small Branches, a designated offi cer will visit the connected to Bank’s central server (CBS): Bank discretion.
186. ˜Maximum deposit in PPF in a FY: Rs.1,50,000
187. ȂK ĸ ĐŝĂů>ĂŶŐƵĂŐĞ/ŵƉůĞŵĞŶƚĂƟŽŶŽŵŵŝƩ ĞĞŵĞĞƟŶŐƉĞƌŝŽĚŝĐŝƚǇ͗Y ƵĂƌƚĞƌůǇ
188. ˜Public Debt Office (PDO) is an ______: Autonomous body and Investment Banker to Central Govt.
189. ȂZ/ŐƌĂŶƚƚŚĞůŽĂŶƚŽĂŶŬƐĂŐĂŝŶƐƚ' Žǀ ƚ^ĞĐƵƌŝƟĞƐĂƚ͗ZĞƉŽZĂƚĞ͘
190. ˜What is full form of USB: Ultra Small Branch.
191. Ȃt ŚŝĐŚŝƐƚŚĞϮŶĚůĂƌŐĞƐƚĞĐŽŶŽŵǇŝŶƚŚĞǁ ŽƌůĚĂŌĞƌh ^͗ ŚŝŶĂ͘
12. What is callable security: which can be called at any predetermined date.
13. Under Atal Pension Yojana (APY), the Central Govt will contribute 50% of total contribution or Rs 1000 whichever is lower, to
eligible subscribers account, for a period of: 5 years.
14. A bank cannot grant loan against security of which type of shares - other bank’s shares, own shares: own shares.
15.A cheque will be valid for: 3 months from date of issue
16.A DD is required to be crossed with account payee crossing if the amount of DD is: Rs 20000 and above
17. A Financial that derives its value from another financial product is called: Derivative.
18.A granted power of attorney to B for operating account of A. You receive information about death of A and simultaneously a
cheque signed by B on account of A is presented for payment. What should the Bank do?: Cheque will not be paid.
19.A minor will attain majority at the age of: 18 years
20.A private limited company must have minimum ___directors?: 2
21.After 6 months of successful transaction, which facility will be provided for accounts opened under PMJDY scheme?: Overdraft
22. Age limit in Prime Ministers Jeeven Jyoti Bima Yojna: 18 — 50
23. All scheduled commercial banks to convert their opening balance sheet as at April 1, 2013 in compliance with the IFRS.
24. An officer does not require permission of Branch Manager for: making payment of a pay order which was issued on account of
purchase of furniture by the bank.
25. Appeal against decision of Banking Ombudsman can be made to: Deputy Governor RBI.
26.Application for information under RTI Act 2005 should be disposed off within: 30 days
27. As per Atal Pension Yojana (APY), the minimum age of joining the scheme is 18 years and maximum age is and the age of
exit and start of pension would be 60 years: 40 years
28. As per Atal Pension Yojana (APY), the minimum period of contribution by the subscriber
29.As per KYC guidelines, Demand draft of how much amount cannot be issued against cash?: Rs 50,000 and above
30.As per latest change, what is the maximum PPF contribution that can be paid in a F.Y?: Rs 150,000
31. As per Official Language Policy, in Region "C", how much percentage of the Sign Boards should be in Hindi?: No specific target.
32.As per Pradhan Mantri Suraksha Bima Yojana (PMSBY) Scheme, all saving bank account holders are entitled to join the scheme in
the age between: 18 to 70 years.
33. As per RBI guidelines, Base rate is to be reviewed by bank on _______: Quarterly basis.
34. As per RBI Guidelines, the charges for closure of bank account before stipulated period should not exceed: not applicable as
banks are free to fix account closure charges
35.As per RTI Act, information is required to be given by public authority within how many days?: 30days
36.As per RTI Act, information related to life and liberty should be submitted within: 48 hrs.
37.As per section 107 and 108 of Indian Evidence Act, a person can be presumed to have died if he is missing for : 7 years
38. As per Supreme Court who cannot be a partner? HUF.
39. At present, who is the Governor of RBI?: Dr Raghuram Rajan
40.Atal Pension Yojana (APY) offers fixed amount of pension ranging between depending upon the contribution which will be based
on the age of joining the APY: Rs 1000 to Rs 5000
41.Balance lying in the account of a company. When winding up proceedings of the company started funds in the account will be at
disposal of: Official Liquidator
42.Bank Customer relation in safe custody: Bailee- Bailor.
43.Banker customer relationship in standing instruction: Agent and Principal
44. Banking Codes and Standards Board of India (BCSBI) is a – (a) subsidiary of RBI (b) Department of Ministry of Finance (c)
Department of Indian Banks Association: None of these as it is an independent and autonomous watch dog to monitor and ensure
that the Banking Codes and Standards adopted by the banks are adhered to.
45. Banks are required to maintain Minimum and maximum CRAR of: Min 9% in India. There is no maximum.
46. Banks should disclose the details of fees/remuneration received in respect of the Bancassurance business undertaken by them, in
the ‘Notes to Accounts’.
47. BCSBI is affiliated or regulated by? An independent body
48. Best indicator of country's growth?: GDP
49.Bharathi Airtel tie up with which bank regarding payment bank?: Kotak Mahindra Bank.
50.Break even point: Level of sales at which there is no profit no loss
51. Broad money is represented by: M3.
52.Business correspondent appointed by bank work as- (a) Bank dealers; (b) Agent of the Bank (c) Customer's agent; (d) RBI agents
(e) RRB Agents (f) Trustees of customer: Agents of the bank.
53. Business correspondent in bank are for banking business: Bank is the Principal and correspondent is the Agent.
54. Call money is available for: one day
55. Call option stands for: Right to Buy but without obligation to buy.
56. CAMEL rating is done by: RBI to judge the health of banks
57. Capital account convertibility means the freedom to convert to financial assets in to foreign financial assets and vice versa.
58. Capital adequacy ratio related to? : CRAR- capital fund.
59. Carbon credits relates to: environment
60.CARE STANDS FOR : CREDIT ANALYSIS & RESEARCH LTD
61.Certificate of incorporation issued by: Registrar of Companies
62. Chairman of SEBI: U K Sinha.
63.Clayton’s Rule is related to which of the following rights?: Right of Appropriation
64. Clean Audit Report means : An audit report without any qualifications
65. Contact less Debit Card has been issued by: ICICI Bank.
66. Contract of Insurance is a contract of: Indemnity.
67.Contract to perform the promise or discharge the liability of a third person in case of his default can be termed as - (a)Guarantee;
(b) Indemnity; (c) Contingency; (d) Subrogation: Guarantee.
68. Cost push inflation is due to: High cost of production
69.Counter Cyclic Buffer required as per Basel III will be made at: normal times
70. CP is issued for amount of: Rs.5.00 lac and multiples of Rs 5 lac.
71.CPPC STANDS FOR : CENTRAL PENSION PROCESSING CELL
72.Cross selling: Offering banks products to existing customers
73. CRR decided by: RBI
74. CRR is based on which act: Sec 42(1) of RBI Act
75. CRR is calculated on: net demand & time liability.
76.Current account operated by finance director of a limited compnay. Cheque signed by him presented for payment after his death:
Cheque should be paid
77. Customer day is observed by banks at what periodicity?: once in a month (15th day of every month)
78. DEATH CLAIM SETTLEMENT IN HOW MANY DAYS? : 15 DAYS
79. Delayed collection beyond abnormal period: SB Rate + 2%.
80. Distribution of Insurance products as Corporate Agents is called: Bancassurance
81. DRP: Disaster Recovery Plan
82. DSB Returns relate to: Off Site Surveillance
83.Duplicate DD to be issued in how many days?: 14 days from the date of request
84. Elasticity of Demand is least in the case of: Items of necessity.
85. Existing total No. of RRBs as on 31-03-2012: 82
86.Expand IFRS -International Financial Reporting System
87. Expand the abbreviations GAAS: Generally Accepted Auditing Standards
88. Facility for Exchange of Notes and Coins: The facility of exchange of cut/mutilated banknotes, in addition to soiled notes and issue
of good quality clean banknotes/coins, should be made available at all bank branches (including those of co-operative banks and
RRBs). This facility should be provided to all members of public without discrimination on all working days
89. FIR is required to be filed in case where the counterfeit notes found are acknowledgement is to be obtained from the concerned
police authorities: Five pieces and above.
90.First Unique Identification Card (Aadhar card) was issued in which state – Maharashtra; Sikkim; Manipur; Karnataka?:
Maharashtra ( To Ranjana Sonawne of Tembhli village in Maharashtra)
91. For counterfeit notes a consolidated report as per prescribed format to be submitted to police authorities if in a single Txn note
is: five pieces or more in one transaction and if four pieces then consolidated report through nodal office to local police station.
92.For creation of Equitable mortgage, the town for deposit of title deeds to be notified by – (a)State Govt; (b) RBI; (c) Central Govt;
(d) Bank: State Govt
93. For injection of liquidity Txn done by RBI: Repo Rate.
94.For seeking information under RTI what is not required?: Reason for seeking information not to be disclosed.
95. For Ultra Small Branches a designated officer will visit the village on a prefixed date and time every ______with laptop and will be
connected to Bank’s central server (CBS): Week
96. Forged currency note: not to be returned & should be impounded
97. Fraudulent Draft presented and paid, who is to lodge complaint: Paying banker
98. FSDC: Financial Stability and Development Council
99.Full form of FDI: Foreign Direct Investment
100. Full form of IRDAI is: Insurance Regulatory & Development Authority of India.
101. Full form of MUDRA: Micro Units Development and Refinance Agency Ltd (MUDRA)
102. Full form of NIM: Net Interest Margin
103. Full form of Nrega: National Rural Employment Guarantee
104. Full form of PRAN?: Permanent Retirement Account No
105. Funds received in Consolidated Fund of India are maintained with: RBI (Reserve Bank of India is the main banker of the
Government and other authorised Banks function as its agents while handling Government transactions).
106. General insurance works on which principle: Principle of utmost faith.
107. Gift City: Gandhi Nagar, Gujarat;
108. Govt securities are known as: Gilt edged securities
109. Govt. infused capital in 9 PSBs in the beginning of 2015 amounting to: Rs.6990 crore
110. Green revolution is related to production of : Wheat and Rice
111. Growth of people in a country is reflected in: real per capita income
112. Guidelines on having Investor Protection Funds by Stock exchanges issued by: SEBI.
113. Head Office of Asian Development Bank is located at: Manila (Philippines)
114. Head Office of International Labour Organisation is located at: Geneva
115. Head office of NABARD is located at: Mumbai (S!DBI Head Office at Lucknow)
116. How much exemption from income is allowed as per section 80 C of Income Tax Act for the financial year 2015-16?: Rs
150,000
117. Hyper inflation- when a country experiences very high and usually accelerating inflation. The general price level within a
specific economy increases rapidly as the functional or internal currency, loses its real value very quickly.
118. IBPP STANDS FOR : INTERNET BILL PRESENTATION & PAYMENT
119. ICAAP full form: Internal Capital Adequacy Assessment Process.
120. If a Garnishee Order is received by the bank in which amount to be attached is not mentioned, what should the bank do?:
Full amount to be attached
121. If there is delay in reporting to RBI by currency chest or there is double/excess reimbursement, what is the rate of
interest charged by RBI?: Bank rate+2%.
122. in 1969, the 14 Bank Nationalised. At that time the Prime Minister of India: Smt. Indira Gandhi
123. In a partnership formed under Indian Partnership Act 1932, what is the liability of a partner?: Partner is liable jointly and
severally i.e. as partner as well as in his personal capacity. Therefore, liability is unlimited
124. In which type of charge possession is with creditor and ownership is with debtor?: Pledge
125. Income Rs.1.00 lac- Tax Rs.0.10 lac, Income Rs.2.00 lacs: Tax Rs.0.30 lacs, Income Rs.0.50 lac-Tax Rs.0.03 lac-This is
example of Progressive Tax
126. Inflation in India is measured on the basis of : Wholesale Price Index
127. Insurance amt in PMJDY: Rs 1 lac.
128. Insurance sector in India is regulated by: IRDA
129. Internal audit is meant for : internal operational check ups
130. Investment Fluctuation Reserve is calculated on which type of security? Available for Sale category and Held for Trading
category.
131. Investment Fluctuation Reserve is maintained on securities classified as: "Held for Trading" and "Available for Sale '
132. Investment Fluctuation Reserve is part of which type of capital: Tier I Capital.
133. Islamic banking has the features of : Conservative banking
134. CMD of a public sector bank is appointed by: Central Govt.
135. Issue of Rs 5 coins to commemorate the occasion of "150th Birth Anniversary of Swami Vivekananda": The Government of
India has minted the above mentioned coins.
136. Issue of Rs 5 coins to commemorate the occasion of "60th year of India Government
137. Job rotation for clerical staff should be done in every ______: 6 months.
138. Kisan Vikas Patra scheme was discontinued in 2010 due to which reason?: Fraud
139. Kite flying means accommodation receipts and payments and not genuine trade transactions
140. KV Kamat has become first chairman/President of which bank?: New Development Bank (NDB) of BRICS
141. LAFAR is submitted by whom?: Statutory Auditor
142. Letter received in Hindi in Region B, answer to be given in %age: 100%
143. LFAR returns relate to: Statutory audit
144. Life Certificate of pensioners is taken in which month?: November
145. Loan should not be granted to a director of the bank against: shares of own bank ( Loan can be granted against bank’s own
deposits; insurance policy; govt security).
146. Main Objective of Infrastructure Development Corporation is : Development of infrastructure of the country.
147. Marginal standing facility rate: 7.75%
148. Maximum period for filing case with Ombudsman: 12 months from receiving reply from bank
149. May I help you counter on how much staff: 10 and above.
150. Meeting of the Official Language Committee is held: Quarterly
151. MGNREGA: Mahatma Gandhi National Rural Employment Guarantee Act
152. MIN SUBSCRIPTION IN PPF CANNOT BE LESS THAN: Rs.500/-
153. Minimum amount of CD – Rs.1. lakh
154. Minimum and Maximum amount that can be deposited in PPF account is _____: Minimum Rs. 500/- & Maximum Rs. 1.50
lacs.
155. Money market mutual funds are regulated by: RBI
156. Mutual fund Market regulated by: SEBI
157. Name of device used by Business Correspondents: Biometric device.
158. Net Interest Income is Equal to: Interest received on assets о/ŶƚĞƌĞƐƚƉĂǇŵĞŶƚƐŽŶůŝĂďŝůŝƟĞƐ
159. New name of Planning Commission: “National Institution for Transforming India” or “NITI”
160. NITI full form: National Institution for Transforming India (Chairman Prime Minister; Dy Chairman Arvind Panagariya).
161. Nobel Price for Microcredit: Muhammad Yunus
162. Number of directors in a public limited company can be: between 3 to 15. For more than 15, special resolution passed by
shareholders is required
163. Payment of DD more than 20000 only by crediting to account and not in cash as per: RBI guidelines
164. PERIODICITY OF CUSTOMER MEET IN A BRANCH: MONTHLY.
165. Perpetual Non redeemable preference share is a part of: Tier -1 capital
166. Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) Scheme offers a life insurance cover of: Rupees 2 lakh
167. Premium in Prime Minister Suraksha Bima Yojana: Rs.12 per year and claim available is Rs.2 lac in case of accidental death
only.
168. Primary Deficit is Fiscal deficit?: Always less
169. Purchaser of DD cannot do the following: Stop the DD
170. Rating of Bank is carried by RBI on CAMELS criteria, what do “C” stands for? Capital Adequacy.
171. RBI at which rate purchases or rediscounts B/E or other Commercial Bks: Bank Rate (7.75%)
172. RBI can issue bank note upto: Rs 10000
173. RBI gives credit to bank on which rate: Repo rate
174. RBI Governor's main concerns in monetary Policy: Inflation and Fiscal Deficit
175. RBI has issued star series notes for replacement of wrongly printed currency notes. Currently, these notes have been
issued in the denomination of : Rs 10, Rs 20, Rs 50, Rs 100.
176. Regulator of Capital market: SEBI
177. Reporting time before 15 minutes from starting of public dealings in: Metro/urban/Semi Urban & Rural area.
178. Revaluation Reserve discounting factor to be taken to which capital: 55% & Tier II Capital.
179. Review of RBI credit and monetary policy: Bi- Monthly
180. RTI: Person seeking information need not give reason as to why he is seeking the information.
181. Sabbatical can be availed maximum: 24 months and two times in your tenure.
182. Safe custody of Articles comes under which act: Indian Contract Act
183. Safe deposit locker – maximum deposit that can be asked is: 3 year advance rent plus locker breaking charges.
184. SAFTA is related to :TRADE
185. Security officer visit for high risk branches: Once in a quarter.
186. Sensex of 30 scrips is related to: Bombay Stock Exchange (BSE)
187. Shares transferred in electronic form: Dematerialization.
188. Spread in the context of bank profit loss account means: Interest earned - interest expended
189. Statutory Audit of banks is done as per provisions of: Banking Regulation Act
190. Subordinate Debt should not be more than % of tier-I capital? 50%
191. Subordinated debt instruments together with all other instruments of Tier - II capital are to be limited to ___ of Tier I: 100%.
192. Subordinated Debt which is a component of Tier II capital, is shown in the balance sheet as a part of: Other Liabilities and
Provisions on the liability side
193. Subprime crisis means : Problem created by lending to borrowers not meeting the credit rating criteria.
194. The Branch Level Customer Service Committee may meet to study complaints/ suggestions, cases of delay, difficulties
faced / reported by customers / members of the Committee and evolve ways and means of improving customer service: at least
once a month
195. The charge levied by banks for under utilization or non utilization of sanctioned CC/OD limits is called: Commitment charge.
196. The Committee on Listing of Stock Exchanges was headed by Dr Bimal Jalan. The Committee has recommended against
listing of Stock Exchanges.
197. The country of Euro Zone facing crises is: Greece and Cyprus (latest Cyprus)
198. The liability of Introducer in case of fraud by the customer: No legal liability
199. The main source of infrastructure finance are: FDI investment, Pension funds, Insurance funds.
200. The police seeks information regarding conduct of an account being maintained in your branch in connection with some
investigation. Can the bank pass on the information? : Yes, if the information is asked by an official of the rank of incharge of Police
Station or above and in writing.
201. The present Bank Rate is: 7.75%
202. The recent committee on urban coop banks was headed by: R. Gandhi
203. Tier I capital also known as: core capital.
204. Tier II capital can be maximum up to : 100% of Tier -1 capital.
205. Total number of Banking Ombudsman in India: 15
206. Transfer of interest in specific immovable property to create security for a debt is called: Mortgage
207. Treasury bill is issued for: 91 days,182 days,364 days
208. UCBs will start TDS at source if interest on term deposit in a financial year is more than Rs.10,000/- from which date: 1st
June 2015
209. Unclaimed deposits with banks which have not been claimed for last 10 years will be transferred to: Depositor Education
and Awareness Fund.
210. Under new pension scheme- minimum subscription in a year: Rs.6000 in a year ( min 500 at one time and for max there is
no upper limit)
211. Under Pardhan Mantri Suraksha Bima Yojana (PMSBY) Scheme, the uniform premium amount of Rs plus service tax
should be applicable per annum per person: Rs 12
212. Under PMJDY Scheme announced by Prime Minister the debit card will be issued to every account holder. The type of debit
card will be: Rupay Card;
213. Under PMJDY, what is the time limit for lodging a claim in respect of the accident as covered under accident insurance
cover: Within 90 days of accident.
214. Under Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) Scheme, the uniform premium amount of is
applicable per annum per member: Rs 330
215. Under Pradhan Mantri Jeevan Jyoti Yojana (PMJJBY) scheme, the individual is eligible to join the scheme at the age
between: 18 years to 50 years
216. UNDR NPS MINIMUM SUBSCRIPTION IN A YR : Rs.6000
217. Uniformity in Intersol Charges: Banks should follow a uniform, fair and transparent pricing policy and not discriminate
between their customers at home branch and non-home branches. Accordingly, if a particular service is provided free at home
branch the same should be available free at non home branches also. There should be no discrimination as regards intersol charges
between similar transactions done by customers at home branch and those done at non-home branches. Cash handling charges may
not be included under intersol charges
218. Upon finding the counterfeit currency note on the counter, the action of the bank should be: Impound the currency note
but credit full amount to customer. Receipt not to be issued to depositor.
219. Voting rights to an individual shareholder in Private banks not to exceed: 10 % (being increased to 26%)
220. What are the total number of digits in Aadhar Card: 12
221. What does LAF stands for_____: Liquidity Adjustment Facility.
222. What is a special purpose vehicle? A special purpose vehicle is a legal entity (usually a limited company of some type or,
trust or a limited partnership) created to fulfill narrow, specific or temporary objectives. Its operations are limited to the acquisition
and financing of specific assets.
223. What is Accrual concept: Every income or expense is taken in to account when becomes due irrespective of the fact
whether it is received or paid or not.
224. What is age limit in PM Jeeven jyoti Bima yojna?: Eligible all saving accounts holder in the age of 18 to 50 years; Benefits
Rs. 2 lac on death due to any reason; Premium – Rs. 330 per annum per member.
225. What is Certificate of Incorporation?: Certificate issued by Registrar of Companies to a limited company, which is a
conclusive evidence of existence of company as a separate body corporate.
226. What is Debt securitization: Converting illiquid financial assets in to liquid marketable securities.
227. What is factoring?: Purchasing of Book debt
228. What is forfaiting?: Without recourse discounting of export bills
229. What is full form of FDI?: Foreign Direct Investment
230. What is full form of GDP?: Gross Domestic Product
231. What is full form of GST?: Goods and Service Tax
232. What is full form of IFRS?: International Financial Reporting Standards.
233. What is full form of ULIP?: Unit Linked Insurance Plan
234. What is guarantee corpus in MUDRA bank or funds allocated for MUDRA: Rs 20000 crore
235. What is Hybrid debt instrument? a) Debenture b) Bond c) Preference
shares d) Convertible Bonds.
236. What is incorrect about RTI?: Reason for seeking information to be mentioned in RTI application
237. What is meant by 'sensitivity' in economics terms? Sensitivity analysis (SA) is the study of how the variation (uncertainty) in
the output of a statistical model can be attributed to different variations in the inputs of the model. It is a technique for
systematically changing variables in a model to determine the effects of such changes
238. What is Personal Accident insurance cover for death and permanent disability due to accident in Prime Minister Jan Dhan
Yojana (PMJDY): Rs.1.00 Lac
239. What is rate of Premium in Pradhan Mantry Suraksha Bima Yojana (PMSBY)?: Premium payable Rs. 12 per annum per
member; sum insured Death / permanent disability Rs. 2 lacs; Partial disability Rs. 1 lac.
240. What is short selling?: Selling securities by a dealer which he does not possess at the time of sale.
241. What is the age limit for coverage under Prime Minister Suraksha Bima Yojna (PMSBY): 18 years to 70 Years
242. What is the amount of insurance cover in case of Prime Minister Jeevan Jyoti Bima Yojan (PMJJBY): Rs 2 lakh
243. What is the cut off point for reporting of Non Cooperative Borrowers – Rs.5. Crore and above.
244. What is the date for final implementation of Basel III?: 31.03.2019
245. What is the effect of Bonus Issue of Shares on Debt-equity ratio? No effect at all as neither there is a change in term liability
nor in net worth of the company.
246. What is the full form of QIP?: Qualified Institutional Placement.
247. What is the full from of GIFT city?: Gujarat International Financial Tech City.
248. What is the impact of increase in Inflation rate?: Purchasing power decreases
249. What is the initial tax exemption limit for Normal Senior Citizens i.e. aged between 60 years to less than 80 years? Rs 3 lakh
250. What is the liability of a bank in case of payment of forged cheque?: Bank is liable to drawer for having made payment
without authority as also for wrongful dishonor of another cheque due to insufficient funds.
251. What is the lock in period for deposits under PPF scheme: 15 years
252. What is the main concern of Indian Economy today?: Rising Inflation
253. What is the maximum age of Govt’s nominee on Board of Directors of a bank?: 70 years
254. What is the maximum amount for which award can be given by Banking Ombudsman in cases other than complaints
relating to credit card: Rs 10 Lac
255. What is the maximum amount of award that can be given by Banking Ombudsman in case of credit cards?: Rs 1 lakh
256. What is the meaning of delegation? Delegation means the granting of authority subordinates to operate within the
prescribed limits. It means subdivision and sub-allocation of powers to the subordinates in order to achieve effective results.
Authority can be delegated but responsibility cannot be delegated.
257. What is the meaning of financial closure? Financial Closure occurs when there is legally binding commitment of private
sponsors to mobilize funding or provide services.
258. What is the minimum paid capital required for setting up a payment bank?: Rs 100cr
259. What is the nature of business of Insurance Co: indemnifying the insured, collective sharing of risks
260. What is the objective of selling mutual fund product by a bank?: To earn non interest income
261. What is the percentage in Region A to bring training materials bilingually?: 100%
262. What is the period of 12th Five year plan :2012-2017
263. What is the Purpose of nomination? To settle claims easily and quickly in case of death of depositor
264. What is the reason for allowing appointment of a Non Banking Financial company as BC?: For increasing financial inclusion.
Compiled by Sanjay Kumar Trivedy, Chief Manager, Canara Bank, Shrigonda,Ahmed Nagar, Maharashtra 10 | P a g e
265. What is the relation between debenture holder and company: Creditor and debtor
266. What is the relation between purchase of a DD and Bank?: Creditor and Debtor
267. What is the relationship between bank and customer in case of Garnishee order?: Debtor and Creditor
268. What is the role of nominee in term deposit?: He is trustee of legal heirs
269. What is the Service Charge for a remittance of Rs.20,000/- to Nepal if payee not customer of NSBL: Rs 100
270. What is the stake of Central Govt., Sponsoring Bank and State Govt. in RRB capital structure: 50:35:15.
271. What is the time within which death of account holder under Prime Minister Jan Dhan Yojna (PMJDY) should be advised to
bank? 30 days
272. What is the transaction code no for DD in the MICR cheques: 16
273. What is Variable cost: Which changes with production like Raw material, wages, power etc.
274. What refers to P-Notes: Participatory Notes used by Foreign Institutional Investors for investment by overseas investors
who are not registered with SEBI.
275. What right is available to paying bank in respect of DD - stop payment, cancellation, revalidation: revalidation
276. What should the minimum holding of Government in public sector banks?: 51%
277. What was the target for opening accounts under Prime Minister Jan Dhan Yojana which was to be achieved by 26 Jan 2015?
Initially 7.5 crore accounts which was later increased to 10 crore accounts.
278. When a bank in addition to accepting deposits and making advances, provides various other types of financial services, it is
called: Universal Banking
279. When a complainant receives copy of award from Bank Ombudsman, within how many days, he is required to give his
acceptance?: 30 days from date of receiving the copy of award.
280. When banks borrow fund for overnight, what is it called: call money
281. When does the right of a nominee start in case of deposits? On the death of all account holders.
282. When is customer day celebrated : 15th of each month
283. When letter of administration issued: When a person dies intestate.
284. When remittance done to currency chest, counting in front of bank officials will be done for denomination of: Rs.500 and
Rs.1000 notes.
285. Which company has got license to start new private sector bank in the year 2014?: Bandhan Financial Services Ltd.
286. Which describes insurance business most?: Disaster risk cover.
287. Which is example of Direct Tax: Income Tax
288. Which is not the function of ALCO?: Fixing Budgets and Targets
289. Which is the central bank of India? : Reserve Bank of India.
290. Which is the first Credit information company of India?: COL
291. Which is the largest source of liquidity in equity market? FII
292. Which of the following can not be done by the purchase of a Demand Draft – (a) Stop payment of DD; (b) Obtain duplicate
DD in case of loss; (c) Getting the DD revalidated; (d) endorse the DD: Stop payment of DD.
293. Which of the following does not come under Tier II capital? a) Capital reserves b) Undisclosed reserves c) Revaluation
reserves d) Cumulative Perpetual shares: Capital Reserves.
294. Which of the following does not have share in RRB? (a) Sponsor Bank (b) Central govt (c) State govt (d) Nabard: Nabard.
295. Which of the following has become new member of Asian Clearing Union: Maldives Monetary Authority. (Other members
are Bangladesh Bank, Royal Monetary Authority of Bhutan, Reserve Bank of India, Central Bank of the Islamic Republic of Iran,
Central Bank of Mynamar, Nepal Rashtra Bank, Central Bank of Sri Lanka, State Bank of Pakistan)
296. Which of the following is a Direct Tax - Excise duty, custom duty, service tax, VAT, gift tax: Gift Tax
297. Which of the following is an indirect tax? Sales Tax
298. Which of the following is Chairperson of NABARD: Sh. Prakash Bakshi
299. Which of the following is index of National Stock Exchange – (a) Nifty; (b) Sensex; : Nifty
300. Which of the following is the financial capital of India – Delhi, Ahmedabad, Mumbai: Mumbai
301. Which of the following will be reduced with increase in inflation? (i) Purchasing Power of money (ii) Interest rate (iii) Cannot
say (iv) CRR (v) None of these: Ans is Purchasing power of Money.
302. Which of the following-is a subsidiary of Standard & Poor? CRISIL
303. WHICH OF THE ITEMS WILL NOT BE AN ASSET IN BANKS BAL SHEET – ADVANCES/FIXED ASSET/ DEPOSITS/
: Deposits
304. Which one is not under core sector: automobile
305. Which sector has highest share in GDP of India?: Services
306. Which tax has been abolished in Budget 2015-16?: Wealth tax
307. Which type of charge to be created on Bank’s FD?: Assignment
308. While giving guarantee favouring stock exchange on behalf of brokers, minimum margin should be (a) 50 % out of which
minimum 25% should be cash margin (b) 50 % out of which minimum 20 % should be cash margin (c) 50 % out of which 10 % should
be cash margin: Ans is (a)
309. While increasing or decreasing interest rate, we often hear basis point. 100 Basis point will be equal to: 1 %.
310. Who can stop payment of a Demand Draft?: Nobody
311. Who decides Saving Bank rate: Bank- ALCO committee.
312. Who has never been Governor of RBI – (a) C Rangarajan; (b) Y V Reddy; (c) Bimal Jalan; (d) Pratip Kumar: Pratip Kumar
313. Who headed the committee appointed by RBI for financial inclusion?: Nachiket Mor (The Committee on Comprehensive
Financial Services for Small Businesses and Low Income Households)
314. Who is Drawee in case of DD - paying branch, collecting bank, issuing branch; purchaser, holder?: Paying branch of issuing
bank.
315. Who is not promoter of CIBIL: RBI....
316. Who is regulator of commodity market in India? 1)sebi 2) Ncedex 3) mcx 4) Forward Market Commission: Forward Market
Commission.
317. Who is the regulator of capital market?: SEBI
318. Who is the regulator of insurance sector?: IRDA
319. Who is the Regulator of LIC: IRDA
320. Who issue Garnishee Order: Court
321. Who was President of India before Ms Pratibha Patil: A P J Abdul Kalam
322. Who will decide Base Rate of a Bank?: Bank itself.
323. Wholesale Price Index is calculated on which basis?: Weekly basis for food inflation and monthly for aggregate inflation.
324. Why International Financial Reporting System (IFRS) should be implemented: For comparison of financials of companies
operating in two different international jurisdictions.
325. Within how many days appeal against Ombudsman can be filed?: 30 days
326. Within how many days, appeal can be made by a bank against the Award of Banking Ombudsman to the Appellate Authority
i.e. Deputy Governor RBI: 30 days from receiving the acceptance from customer
327. You need to issue a Demand draft for Rs 10,000 favouring Mr X of Chandigarh. Which one of the following will not be the
option while issuing DD – (i) Payee will be Mr X or Bearer (ii) Payee will be Mr X Chandigarh (iii) Payee will be Mr X State Bank of India
A/C 31435195901: Mr X or Bearer
GENERAL BANKING
1.Mutual Funds are controlled by: SEBI.
2.Duplicate DD should be issued within: 14 days from date of request.
3.Public Debt Office (PDO) is an ______: Autonomous body and Investment Banker to Central Govt.
4.What is the rate of TDS in case of Savings Bank deposit account as per Income Tax Act Section 80TTA : TDS is not applicable in
savings bank interest.
5.What is the rate of TDS in case the customer does not submit PAN card and 15G/ 15H : @ 20%.
6. Complaints under Consumer forum should be dealt with within (Where no testing of commodities is required) : 90 days
7.Locker Operation to be categorised under High and Low risk. In case of non-operation of such accounts for ____ and ______: 1
year and 3 years respectively.
8.Maximum deposit for allotting a locker: 3 year advance rent plus locker breaking charges.
9.What is the latest RBI directives for issuing DD for amount of Rs. 20,000 and above: It should Account Payee only.
10. RBI can issue bank note with highest denomination : Upto Rs. 10,000
11. Govt. of India can issue currency note in denomination of : Rs. 1
12. In FDR if the principal and interest is Rs. 20,000 or above it is not to be paid in cash as per: Section 269T of Income Tax Act.
13. SB /CD to be treated as inoperative if there are no transaction for over a period of: 2 years
14. If counterfeit notes up to _______ are detected in a single cash transaction in the bank branch, the bank should send a
consolidated report to the Police at the end of the month?: Less than 5.
15. Letter of Administration is issued by court when: A person dies without leaving a Will ( Intestate).
16. When is letter of administration issued: When a person dies intestate.
17. Differential rate of interest can be paid on fixed deposit if deposit is for: Rs.1.00 crore and above.
18. What is Hybrid debt instrument? a) Debenture b) Bond c) Preference shares d) Convertible Bonds*
19. Implied authority of a partner does not allow ______ singly? Settle a dispute relating to the business of the firm thru
arbitration.
20. If ____ number of counterfeit notes are detected in single transaction, a consolidated report sent to police station: Less than
5.
21. Under Ombudsman, on receiving the award both the bank and the complainant can appeal to the appellate authority in how
many days: 30 days.
22. TDS deducted for interest amount: If interest amount is above Rs 10,000/-.
23. Minimum subscription in PPF cannot be less than: Rs.500/-.
24. The single portal initiated by Ministry of Corporate Affairs for one stop solution for all Companies: MCA21.
25. The RBI is using _____ index of inflation for policy making: Consumer Price Index.
26. BCSBI is affiliated or regulated by? An independent body.
27. Certificate of Incorporation is: Not required in case of Pvt Ltd Co’s.
28. What is full form of IFRS: International Financial Reporting Standards.
29. General Insurance works on principle of: Spread of Risk.
30. Contract of Insurance is a contract of: Indemnity.
31. FIR to be filed if number of Counterfeit notes in a single deposit is: 5 or above.
32. Under RBI KYC directives, CFT stands for: Combating Financing of Terrorism
33. Full KYC is required at least once in __ yr in case of high risk customer: 2 years
34. Govt. of India issue which note : Re. 1
35. Letter of administration is issued by court when: there is no Will and there is estate to manage.
36. Time limit for preservation of record under KYC: 5 years from close of account in respect of records relating to opening of
account and 5 years from date of transaction in respect of transactions reported to FIU.
37. If Locker rent is Rs.7400/- per year, locker breaking charge:Rs.2000/-, how much Maximum deposit can be taken from the
lessee while allotting a locker?: Rs.24200/-
38. ALCO does not decide: Budgets and Targets
39. The focus of Asset Liability Management is: To protect Net Interest Margin.
40. A customer deposited huge amount in cash several times. When Branch manager enquired about the same, the customer did
not give the details. What should be done?: Report to FIU as part of Suspicious Transaction Repot.
41. When the letter of Administration is issued by court?: When the customer expired without writing will.
42. R Gandhi commitee related to: Urban Co-operative Banks (UCBs); to strengthen co operative banking structure.
43. Headquarter of world economic forum: Cologny, Switzerland
44. What payment bank cannot do: Lending
45. SLR w.e.f. 2016-17: 20.50%
46. Under Sovereign Gold Bond scheme maximum units acquired up to: 500 unit (i.e. 500 gm gold).
47. SCORES is related to - a)SEBI; b)IRDAI; C)PFRDA: SEBI. SCORES is Sebi's online platform that provides a centralised database of
all complaints.
48. In case of Fixed Deposits premature payment option is must for the deposit up to : Rs.15 lac
49. Scoring is related to which of the following - a.RBI. b.NSE c.PFRDA d. None of these:
50. Maximum foreign investment in Public sector bank: 20%
51. For Payment bank, Reliance Industries tie up with: SBI
52. Gold Monetisation Scheme: MTGD interest rate: 2.25%
53. Committee on Bankruptcy Law: T.K.Vishwanathan
54. Money market mutual fund regulated by? Earlier by RBI and now by SEBI
55. What is the target for CPI based inflation in Jan 2016?: 6%
56. Bhartiya Mahila Bank is a) Nationalized bank, b) Gramin bank, c) Public sector bank, d) Private bank: Public Sector Bank
57. Indian Currency Rupee is in circulation in two more countries. One is Nepal, the other is _______: Bhutan.
58. Why International Financial Reporting System (IFRS) should be implemented: For comparison of financials of companies
operating in two different international jurisdictions.
59. The value of a gift that can be given by banks to its customers cannot exceed rupees: Rs. 250
60. Which is not the function of ALCO: Achieving Budget target.
61. Maximum age under PMSBY: 70 Years.
62. Monthly consolidated report to Police in case of how many counterfeit notes: Detected upto 5 and above pieces in a
63. What is incorrect about RTI: Reason to be mentioned in RTI application.
64. Which of the following is not a case of bailment?: When cash is deposited with bank.
65. Full form of P-notes in financial jargon? Participatory Notes
66. International Financial Reporting System (IFRS) should be implemented: For comparison of financials of companies operating in
two different international jurisdictions.
67. After issuing a Garnishee Order by court, Bank is referred is _______: Garnishee.
68. What is Regressive Taxation: As the tax base increases or income increases, the taxation rate decreases.
th
69. The coins of which denomination have been released as part of the 125 birth anniversary year celebrations of Dr. B.R.
Ambedkar? (10 rupee and 125 rupee)
70. According to report of the Global Financial Integrity’s (GFI’s), India has been placed at which position in black money outflows
among the developing and emerging economies? (Fourth)
71. Who is the CEO of NITI Aayog? (Amitabh Kant)
72. Name the Central bank of U.S. (Federal Reserve System)
73. Who has been appointed as an Executive Director on the board of International Monetary Fund (IMF). (Former RBI Deputy
Governor Subir Gokaran)
74. Which bank has recently been pulled up by the CBI for disbursing Rs. 950 crore to KFA despite it having an unfavourable rating?
(IDBI Bank)
75. Name the New Finance Secretary: Ratan Watal.
76. NABARD undertakes supervision on which type of Bank: RRBs.
th
77. Hindi day is celebrated on: 14 Sept.
78. Annual Inspection of large loans is carried out by RBI inspectors. What is this audit is called? Statutory Audit.
79. What is minimum amount of DD which should be issued by bank with account payee crossing: Rs. 20,000.
80. Aggregate Capital Market exposure of a bank should not be more than: 40% of net worth of bank
81. Minimum capital required for Small Finance Bank and Payment Banks is Rs. _______: Rs.100 cr.
82. Service Tax increased to 14.50% with effect from : 15.11.2015 and 0.5% wef 01.06.2016 (KISAAN CESS)
83. What should be the Promoter contribution in Small Bank: 40%
84. What is the interest rate in case of Sovereign Gold Bond scheme: 2.50%.
2. MODULE B: FUNCTIONS OF BANKS

Memory Based Recalled Questions
BANKING LAWS INCLUDING NI, BR & RBI ACT AND PRACTICES
Nomination
1. A & B are having joint a/c with ‘e or s’ operation with x as nominee. A dies: The deposit on maturity payable to B.
2. A person having locker has expired. The nominee comes. A sealed cover is found. What will you do ? : It will be delivered to
him as part of locker contents without opening the packet.
3. A person of 65 years of age can not nominate which of the following persons: Trust
4. For making nomination in term deposits how many witness signature required? Nil but if depositor is illiterate then two
witness
5. If a customer makes nomination, the bank is required to register in its books the nomination, and should give
acknowledgement to the depositor in writing. The bank should also indicate the fact of nomination on the face of passbook/deposit
receipt with the legend (a) Nomination Registered (b) Nomination marked (c) Nomination done (d) Nomination acknowledged:
Nomination Registered
6. If a depositor dies, payment to nominee or legal heirs should be made within: 15 days of completion of formalities.
7. In case of a Deposits account customer wants the Nomination in his account. What is mentioned on Pass book Ans >
Nomination Registered
8. In case of a jointly operated joint account, the nominee can obtain payment, : when none of the account holder is alive
9. In case of minor account under Guardianship, nomination can be given by: Natural Guardian.
10. In the context of Nomination, which is correct statement?:Signatures of nominee not required on nomination form.
Nominee's name should be mentioned on FDR if agreed by the customer
11. Loan was raised from the bank against NSC by Mr. X and noting to this effect was recorded in the issuing Post Office. X dies.
The nominee approaches post office for payment of NSC. Who will have priority i.e. bank or nominee?: Bank will have prior claim
against NSC.
12. Nomination - Minor can be a nominee.
13. Nomination facility for deposit accounts is available under: 45ZA & 45 ZB of the BR act
14. Nomination facility is not available in the case of : Trust A/c. (facility of nomination is available only in the case of
individual(s).
15. Nominee can claim payment when: Only after the death of depositor (account holder) as a trustee on behalf of the legal
heirs.
16. Provisions relating to Nomination are given in : Banking Regulation Act (Sec 45 ZA to 45 ZF)
17. There is a joint account in the name of A & B payable to either or survivor. On the death of A, the amount will be payable to
B, the survivor.
18. What is the status of Nominee? Trustee of Legal heirs
19. When a NRI customer who had maintained NRE/FCNR depositor dies, how the balance in the account will be given to his
Nominee?: If nominee is resident in India then after observing usual formalities but if nominee is non-resident residing abroad, then
deposit proceeds cannot be repatriated without obtaining prior permission from RBI.
20. Whether Minor can nominate ? no. On his behalf nomination will be done by a person legally competent to act on his
behalf.
21. Who can be a nominee?: Only an individual
22. Who can make nomination in the deposit account of a minor?: Guardian on behalf of the minor.
Ombudsman
1. A Bank can prefer appeal on the award passed by Banking Ombudsman to Deputy Governor within _____ from the date on
which the bank receives letter of acceptance of Award by complainant: 30 days
2. Banks are required to implement the award of Ombudsman unless a decision is taken to appeal against the same within one
month from the date of receipt of acceptance of the award by the complainant
3. For its implementation, the complainant should accept the award given by Ombudsman within: 30 days of the receipt of the
copy of the award.
4. If a complainant is not satisfied with the award or his complaint is rejected by the Banking ombudsmen, he can prefer an
appeal to Deputy Governor, RBI within: 30 days of the of the date of receipt of communication regarding award or rejection of the
complaint.
5. Ombudsman Award - Max for credit card: Rs. 1,00,000.
6. Total number of Banking Ombudsman in India: 15
7. Under Ombudsman scheme, the authority for appeal is: Dy Gov. RBI
8. Under Ombudsman scheme, which type of case not entertained?: advocate representing the customer
9. Under the Ombudsmen scheme, the Bank has to reply to the objection of the complainant within: one month
10. What is the maximum amount of Award that can be given by an Ombudsman under RBI's Ombudsman scheme? Rs. 10 lacs.
11. When an order passed by Banking Ombudsman is accepted by the complainant, the same should be complied within: 1
month from the date of receipt of acceptance from the complainant.
12. Whether a customer can approach Ombudsman without first approaching the Bank : Approaching the bank first is a pre-
condition
13. Who is appointed to tackle public complaints against the public authorities : Ombudsman
14. Within how many days of filing a complaint with the bank, the complainant can approach the Ombudsman: One year from
the date of the receipt of the reply from the bank. If no reply received then it is one year and one month.
Negotiable Instruments Act
1. A bearer cheque of Rs.7,000/- was presented. The cashier informed that the cheque can not be passed as the balance is less
by Rs.700/-. The tenderer credited the amount of shortfall and the cheque was paid. Customer disputed the transaction. Whether
bank is liable?: Yes. For disclosing balance to third party, bank is liable to account holder for breach of secrecy.
2. A cheque crossed specially to a bank is presented by the same bank to paying bank for cash payment. What should the
paying bank do? Bank can make cash payment.
3. A cheque is presented for payment in which amount in figures is mentioned as Rs 10,000 whereas the amount in words is
mentioned as Rs Ten lakh only. In terms of section 18 of the N I Act, what should the bank do?: The amount written in words should
be paid as per Sec 18 of NI Act..
4. A cheque is written in English and Regional Language. Whether it can be paid?: Yes. A cheque written in different language
can be paid if otherwise in order.
5. A cheque signed by agent has been presented after his death for payment. What should the bank do?: The cheque will be
paid if otherwise in order.
6. A cheque was stolen and its payment was taken by forging the signatures of the drawer. The signatures were so cleverly
forged that it was very difficult to detect the forgery. Under which section of N I Act, paying banker will get protection?: No
protection to paying bank
7. A Cheque with forged signatures is presented for payment and is paid. Bank will be liable to: Customer (Drawer of the
cheque)
8. A Cheque with material alteration was paid as alteration was not visible. Under which section of N I Act, paying banker will
get protection?: section 89 of NI Act
9. A cheque written in different inks and handwriting is presented, for payment : it will be paid if otherwise in order
10. A customer can deposit cheque on counter instead of depositing in cheque drop box should be mentioned at: on box
itself
1. A has granted Irrevocable Power of Attorney in favour of B for one year. After 3 months, A revokes the Power of Attorney. A
cheque signed by B is presented for payment_ What will you do? The cheque will not be paid because POA can be withdrawn before
maturity and once it is revoked, no cheque signed by agent can be debited to account of Principal
11. A post dated cheque is passed in the account of a customer. But another cheque which was in order was dishonoured due
to insufficient funds. What is the liability of the Banker?: Bank is liable to the drawer for paying post dated cheque as bank is not
justified in paying post dated cheque. The bank will be liable to drawer for damages on account of wrongful dishonour of cheque.
12. A, having SB a/c with you, deposited Rs.25000. A public Prosecutor sent notice to bank informing that Mr A is involved in
forgery and requested not to permit withdrawal in the a/c. In between one cheque of Rs.20000 has been presented for payment.
What should be done by the bank?: Pay the cheque as Public Prosecutor is not authorized to freeze the a/c.
13. Account payee cheque paid in cash to agent of collecting bank. Whether it is in order?: It is in order as collecting bank will
credit to account of payee.
14. An authority has been granted in an account You have received information about the death of the Principal. Today, you
receive a cheque signed by the agent which is dated prior to the death of the Principal. What should the bank do? : Cheque can not be
paid as authority of agent comes to end with the death of the Principal.
15. Ante dated cheque like cheque dated 15.12.07 is presented for payment on 1.1.08 whereas_ the account was opened on
20.12.07 : Cheque should be passed
16. As per section 26 of the Negotiable Instruments Act, a Minor can draw, endorse, accept a negotiable instrument but he can
not : bind himself
17. As per Section 31 of N I Act, in case of wrongful dishonor of cheque, bank will be liable to: Drawer of cheque and not liable
to payee.
18. Bank can charge collection charges of not more than for _outstation cheques of Rs10000 to Rs 1 lac in saving bank: Rs. 100
19. Banks print cheque books having similar particulars. The format of cheque is prescribed by which Act : Not defined in any
Act. It is as per practice
20. Bearer uncrossed cheque can be paid to whom : To the bearer
21. Cheque Drop Facility – Message for depositing cheques either at counter of by dropping in box should be displayed in:
English, Hindi and the concerned regional language of the State.
22. Cheque has been defined in: Section 6 of N I Act
23. Cheque issued by director of a company and presented after his death will be: Passed if in order
24. Cheque issued without balance what penalty: No penalty (Only on dishonour, Court Proceedings).
25. Cheque received in clearing signed by whom will not be passed out of the following: signed by a person who has been
declared insolvent.
26. cheque truncation means: converting physical cheque to electronic image and stopping physical flow of a paper cheque.
27. Collecting bank protection under which Sec of NI Act: Sec 131 of N.I. Act.
28. Credit of Rs.20,000/- was taken as Rs.2000/- and as a result a cheque was returned in the account for want of funds.
Bank has already sent statement of account to the depositor who has acknowledged receipt of the statement of account.
Whether bank is liable?: Yes. Liable to drawer of cheque.
29. Crossed cheque payment across the counter to the authorized Officer of collecting Bank - can be made and there are no
violation as per NI Act.
30. CTPS stands for: Cheque Truncation payment system
31. Current account operated by finance director dies. Cheque signed by him: Will be paid
32. Current balance is Rs.6000/-. A cheque of Rs.18,000/- is presented. Branch passed the cheque by allowing TOD. After few
days, fixed deposit of the same party matured and TOD was cleared by crediting the proceeds to CA. Customer disputes the
transaction. Whether bank is having right in doing so? : Normally no without specific request of the party. However, if bank has a
specific clause in the account opening form to allow overdraft in such cases and customer has consented to such clause, then
temporary overdraft can be allowed and recover the same from the account holder even if there is no specific request from the party.
33. Facilities granted to visually impaired person: All facilities including cheque book, ATM,
34. Format of Cheque has been prescribed in which Act?: None because it is as per Practice and Usage
35. If a cheque is dishonoured due to insufficient funds, then as per section 138 of N I Act, court may award imprisonment up
to: 2years
36. If date on a cheque is prior to the date of its presentation, it is called: Ante Dated cheque
37. If on a Bill-of Exchange, two parallel lines are drawn and not negotiable is written between the lines, what kind of the
crossing will be there: Provisions relating to crossing are not applicable to Bill of Exchange
38. If on a cheque words "Account Payee" is written between two parallel lines or with the name of a bank, then: the cheque
can not be endorsed.
39. If time is not mentioned on a promissory note or Bill of Exchange, when it will be payable? It is payable on demand;
40. In an account Mr. X Gives irrevocable power of attorney to Y for 1 yr. After 4 Month, X withdraw the irrevocable power of
attorney. What is action of the Bank? Bank will rely the revocable application of the Hence the cheque signed by Y returned.
41. In an account of Club with you, cheque has been been presented for payment signed by the secretary who has died. What
should the bank do?: It will be paid if it not dated subsequent to date of death.
42. In case of Cheque Drop Box facility, out of the following, which is not correct: a) Under No Circumstances, branches shall
refuse to accept the cheques over the counter b) Branches shall give proper acknowledgement when cheques are tendered across the
counters c) Customers shall not be forced / compelled to drop the cheques in the Drop Box d) Customers are asked to put a small
Round Stamp of the Bank on counterfoils as Proof of receipt: Ans is D (Customers are NOT asked to put a small round stamp)
43. In the case of dishonour of a cheque due to insufficient funds, for enforcing rights under section 138 of the Negotiable
Instruments Act 1881, the holder should send a notice to the drawer within: 30 days from the date of receipt of notice regarding
dishonour of the instrument.
44. In the case of Wrongful dishonour of cheque, to whom the bank is liable?: Drawer
45. In which of the following situations bank will not be a holder in due course?: When bank credits the account of the
customer after receipt of funds on account of cheque sent for collection
46. Maximum amount of fine under section 138 of N I Act for dishonour of cheque due to insufficient funds is: twice the
amount of cheque.
47. Noting of Negotiable Instrument refers to: Bill of Exchange and not Cheques.
48. On the face of a cheque, the name of a bank is written without two parallel lines. This will amount to : special crossing
49. Paying Banker will get protection in case of payment of cheques under section 85 of N I Act provided payment is made in:
good faith and without negligence
50. Payment in due course is defined under which Act: Sec 10 of N.I. Act.
51. Payment of cheque can be stopped by: only Drawer of the cheque
52. Position of bank if stop payment cheque is paid: Not a payment in due course as per Sec 10 of NI Act.
53. Protection in case of payment of cheques with Material alteration available under: Sec 89 of NI Act.
54. Protection is available to the collecting banker in case of : Crossed cheques
55. Protection to the Collecting bank is available under which Sec of NI Act: Sec 131 of N.I. Act.
56. Special crossing banker protection Section: 124 of NI Act.
57. The crossing on a cheque is required to be cancelled. Who can do so: Drawer
58. The drawer of a cheque wants that the endorsee should not get a defect free title when he receives an endorsed cheque.
What type of crossing would be required : Not-negotiable crossing.
59. The iimitation period for filing case in case of dishonour of cheque due to insufficient funds is: 1 month from the date of
cause of action.
60. The true owner of a cheque has been deprived his right by collection of the cheque for a different person. This is called :
Conversion
61. There are certain instruments defined as negotiable instruments under law and certain instruments used as negotiable
instruments as per practice. Which of the following is not a negotiable instrument as per NI Act: Dividend warrant
62. There is a joint account in the name of A &B. A cheque is drawn by A but the alteration in the amount is authenticated by B.
Whether bank can pay the cheque: Yes provided the operation is either or survivor.
63. There is an SB a/c in the name of A & B .They have given power of Attorney to 'C' for operation in A/C, The cheque signed by
the 'C' is presented in the bank after death of 'B' : cheque will not be passed
64. Time limit to sue in case of cheque return due to insufficient funds: 1 month from date of cause of action. That is 1 month
th
from 15 day on which notice of dishonor received by drawer
65. Two cheques have been presented to you as paying banker. One is dated prior to opening the account and other is dated
prior to issue of cheque book. What will you do as paying banker?: Both cheques will be paid.
66. What are the two digits for Current account under MICR cheque: 11
67. What is a bill of exchange - unconditional undertaking/ unconditional order: unconditional order.
68. What is a General crossing?: Drawing two parallel lines on face of a cheque
69. What is a promissory note?: Unconditional promise to pay.
70. What is a sans recourse endorsement – conditional endorsement, restrictive endorsement, facultative endorsement, per
pro endorsement, none of these: None of these. In sans recourse endorsement, endorser excludes his liability.
71. What is conversion: Interference with the legal rights of true owner: Cheque in favour of the Co being credited in the
personal account of the director.
72. What is full form of CRAR?: Capital to Risk weighted assets ratio
73. What is material alteration?: When a change is made in a cheque in such a way that it speaks a different language than
which it originally spoke.
74. What is Noting: Getting dishonoured B/E noted from notary. The certificate is called Protest.
75. What is special crossing: Writing name of a bank on a cheque with or without two parallel lines.
76. What is the effect of 'Not Negotiable Crossing'?: Transferee does not get better title than the transferor.
77. What is the impact of Not negotiable crossing on a cheque?: Title of Transferee will not be better than title of transferor.
78. What is the maximum imprisonment that can be awarded on dishonour of a cheque due to insufficient funds?: 2 years
79. WHEN CHEQUE DISHONOURED, NOTICE TO BE SENT BY PAYEE TO THE DRAWER WITHIN: 30 DAYS.
80. When no time or date is mentioned on bill of exchange, then it will be payable: On demand.
81. When only image of cheque is sent to the paying bank while sending cheque for collection instead of sending the physical
cheque, the process is called: Cheque Truncation
82. When proceeds of cheque are given before clearance of the cheque the banker will be called: Holder for Value.
83. Which crossing is a Special Crossing : Name of Bank is written in the cheque with or without parallel lines
84. Which crossing takes away the feature of assumption of defective free title available to the transferee : Not negotiable
crossing
85. Which is not a General Crossing: Name of a bank written between two parallel lines
86. Which of the following can be done by a minor?: A minor may draw, indorse, deliver and negotiate a promissory note, bill of
exchange or cheque so as to bind all parties except himself.
87. Which of the following cheques can not be paid by the bank? : A cheque on which signatures of drawer have been forged
irrespective of the cleverness in forgery and though these appear to be same as that of the drawer.
88. Which of the following is a General Crossing – Two parallel lines on back of cheque; single line on face of cheque, name of a
bank without parallel lines, Not negotiable written on face of a cheque: Two parallel lines on face of a cheque
89. Which of the following is material alteration? Converting order cheque to bearer
90. Which of the following is not a disadvantage of CC account? Issuance of cheque book
91. Which of the following is not a material alteration: Adding crossing on an open cheque
92. Which of the following is not a material alteration?: Bearer to Order
93. Which of the following is not a negotiable instrument – cheque, promissory note, bill of exchange, FD: FD
94. Which of the following is not a valid cheque for payment by the bank-l)different ink & handwriting 2) cheque with prior date
3) cheque with impossible date 4) Mutilated cheque: Mutilated cheque
95. Which type of crossing is required to be done if the drawer wants that in case of endorsement, the title of transferee of the
cheque should not be better than the title of the transferor: Not Negotiable Crossing
96. While paying a bearer cheque, signatures are obtained on the back side of the cheque. Why ? : As evidence of payment
97. Who is primarily liable on bill which has not been accepted: Drawer
98. X presented a cheque drawn by A in favour of the Bank to credit the proceeds to X account: Can be credited if there is
specific direction from the drawer
RBI
1. Angular bleed line is not present in notes of which denomination?: Rs.50
2. As per RBI guidelines, which denomination notes printed prior to 2005 should be exchanged by banks for both customers and
st
non customers up to 31 December 2015 – (a) More than Rs 500 only; (b) Rs 500 and Rs 1000 only; (c) All notes up to Rs 500; (d) All
notes: All notes printed prior up to 2005
2. As per which Act, DD cannot be made payable to bearer?: Section 31 of RBI Act.
3. Bank rate is decided by: RBI
4. CAPITAL ADEQUACY RATIO RELATED TO? : CRAR
5. CRR is decided by___ and how much interest is paid on CRR balance: RBI, No interest is paid.
6. CRR is maintained as per: Sec 42(1) of RBI Act
7. Monetary & Credit policy is issued by: RBI
8. Money market is regulated by: RBI
9. No noting on currency note, directions issued by RBI under section 35A of BR Act.
10. Rate at which RBI lends funds to Commercial Banks against Government Securities is - (i) REPO (II) Reverse Repo (iii) SLR (IV)
Bank Rate: Repo Rate
11. Rate at which RBI rediscounts bills of commercial banks is called – Bank Rate, Base Rate, PLR: Bank Rate
st
12. RBI Act was enforced from: 1 April 1935
13. RBI controls money supply through: change in CRR
14. RBI exercise monetary control through: CRR, SLR, Repo
15. RBI has allowed banks to grant loan to its own director against the security of - Gold Jewellery; Quoted shares; Life
Insurance Policy: Life Insurance Policy
16. RBI injects liquidity in system by? Repo transaction or reduction in CRR;
17. RBI will increase the size of numeric of which currency note? Rs 100, Rs 500, Rs 1000, Rs 50
18. Section 45 ZA to 45ZE of Banking Regulation Act relate to?: Nomination in case of deposits, safe deposit and
lockers.
19. SLR is calculated on the basis of – Net Demand and Time liability; Total deposit; Total advance: Net Demand and Time
liability.
20. Supervision of banks is done by RBI under which act: RBI Act / BR Act / Jilani Committee Report / NI Act: Banking Regulation
Act
21. The rate at which RBI rediscounts the usance bills of banks is called: Bank Rate
22. Validity period of cheque reduced to 3 months from 1.4.12 as per : RBI Guidelines under sec 35A of B R Act
23. What are d monetary tools to manage liquidity: SLR, CRR
24. What are RBI guidelines for use of ATM by visually handicapped person? : ATM facility to be allowed. From July 1, 2014,
100% of ATMs should be friendly to visually impaired persons
25. What is Bank Rate at present?: 7.00%
26. What is Repo transaction?: Sale of Govt securities by banks to RBI with a promise to repurchase after sometime.
27. What is the current rate of interest paid on CRR?: NIL
28. What is the floor and cap limit of CRR as per RBI Act?: No such limit
29. What is the latest RBI directives for issuing DD for amount of Rs. 20,000 and above: It should Account Payee only.
30. What is the maximum and minimum limit for maintenance of CRR?: No minimum or maximum as per RBI Act. It is decided
by RBI.
31. What is the present rate of SLR?: 21.25% of NDTL
32. What is the rate of Marginal Standing facility? 7.00%
33. What should be the minimum share of Govt in a public sector bank or in a public sector company or Govt company?: 51%
34. What would be the action of central bank in recession?: create liquidity by decreasing CRR and lower the repo rate.
35. When banks purchase Govt Security form RBI, it is called: Reverse Repo
36. Which of the following is not added in the demand and time liabilities for calculation of SLR?: Capital and reserves, inter
bank deposits for maturity up to 14 days, borrowings from RBI and refinance from NABARD, SIDBI.
37. Which of the following is not decided by RBI – SLR; (b) Repo Rate; (c) Bank Rate; (d) Inflation: Inflation
38. Which of the following is not true about RBI (a) RBI announces credit and monetary policy (b) RBI maintains forex reserves
(c) RBI allows ways and means advance to central Govt (d) Banking Secretary of Union Govt is the Governor of RBI Ans is (d)
39. Which of the following is the main function of RBI?: Management of Liquidity and Monitoring of banks (To formulate,
implement and monitor the monetary policy with the objective of maintaining price stability and ensuring adequate flow of credit
to productive sectors)
40. Which of the following rates is not decided by RBI – Bank Rate; CRR; Interest Rate on FD; Repo Rate: Interest Rate on FD
41. Which rate not decided by RBI – Repo Rate; Reverse Repo Rate; Interest Rate on Saving deposits: Interest rate on SB
deposits
42. Who is the RBI Deputy Governor who was appointed in place of Subir Gokarn?: Dr Urjit Patel
MISC.
1. ȂĂŶŬŝƐŶŽƚƌĞƋƵŝƌĞĚƚŽƉƌŽĚƵĐĞŽƌŝŐŝŶĂůďŽŽŬŽĨƌĞĐŽƌĚƐďƵƚƚƌƵĞĐŽƉǇĐĂŶďĞƐƵďŵŝƩ ĞĚǁ ŚĞŶĐŽƵƌƚŚĂƐĚĞŵĂŶĚĞĚĂƐƉĞƌ
which Act: Bankers Book Evidence Act.
2. A public limited company can start business after receiving from Registrar of Companies. Certificate of
commencement of business. ( Not required as per Companies Act 2013 )
3. A bank branch receives a counterfeit note of Rs.1000, which customer wants back. What the bank should do : Impound the
currency note but credit full amount to customer. Receipt not to be issued to depositor.
4. A bill issued without consideration is called: Accomodation Bill
5. A bill was presented on 10.5.2005 and accepted on 12.5.2005. The bill was due for payment on 29.07.2005 and was
returned. The last date for filing suit in this case is : 29.07.2008
6. A crossed DD was paid by cash. What risk is there for the Bank: Bank will be liable to true owner of the DD if payment made
to a person other than true owner (Section 129 of N I Act).
7. A Garnishee order is issued by the court on behalf of _______: Judgment Creditor
8. A listed bank has to prepare and publish balance sheet on quarterly basis as per: SEBI guidelines
9. A minor is aged 15 years, who is illiterate. Which type of self operated a/c can be opened -SB/ RD / FD none
10. A person wants to open a joint account with his wife in such a way that the account can be operated by him only during his
lifetime and she should be able to operate the account only after his death. The account has to be opened with the instructions:
'Former or survivor'.
11. A solicitor has account in his name and in the name of his client. Garnishee order is received in the name of the solicitor.
Whether the same will be applicable in the name of client also: No because two accounts are not in the same right and same capacity.
12. Account holder A & B want to substitute their name with the name of their sons C & D in the account. What should the bank
do?: Substitution of all names is not allowed. At least one of the original account holder should be retained in the account.
13. Administrator is appointed in case of: to realize assets and pay off liabilities of a person who has died without writing a will.
14. An endorsement in which endorser excludes his liability is called : sans recourse
15. Articles of Association mentions: directors' powers
16. As per Consumer Protection Act, the period for filing appeal to State Commission against decision of the District Forum is:
maximum 30 days
17. As per KYC guidelines, the periodicity of obtention of photograph and latest address proof for Low Risk. Customers is__
Medium Risk___years and High Risk Customers is__ : 10 years, 8 years 2 years.
18. As per Prevention of Money laundering Act, preservation of records relating to closed accounts upto: 5 yr from date of
closure of account.
19. As per RBI guidelines, all banks are required classify business in various business segments with effect from 31-03-2008. The
segments are: (a) Treasury (b) Corporate / Wholesale Banking, (c) Retail Banking, (d) Other Banking Business. The geographical
segments are 'domestic' and 'international'.
20. As per recent RBI/Govt. guidelines, pensioners can open account jointly with: spouse, to be operated as either or survivor or
former or survivor.
21. Bank Guarantees are issued as per provisions of : Indian Contract Act
22. Banks can provide information about the customer to another Bank: General in nature, without any responsibility
23. Can Karta of HUF appoint Agent or delegate the powers to other co-parcener: Yes, he can do so.
24. Charged created by Bailment of goods to secure payment of a debt is called: Pledge
25. Charges for Speed Clearing: Nil -for collecting outstation cheques in local clearing for amount up to Rs 1 lac in case of SB
customers. For cheques of more than Rs 1 lac or any amount now -NIL irrespective of amount of cheque
26. Committee on Procedures and Performance Audit of Public Services (CPPAPS) was headed by: S.S. Tarapore
27. Counterfeit notes returned after police verification, the same has to be preserved for 3 years subject to half yearly
verification.
28. Customer of your bank asks for cash payment of crossed DD. What would you do? Generally payment only through bank
account. However, bank can pay after duly satisfying the genuineness of the draft and payee but bank will continue to be liable to
true owner if recipient is not true owner.
29. Customer service code has been mentioned in : Banking Codes and Standards Board of India.
30. customer service Committee meeting held on : Monthly basis
31. Customer-bank relationship in locker account: Lessee-Lessor
32. DD can be revalidated within: any time (practice may differ In different banks)
33. Direct Impact of increase in CRR is : Controlling Liquidity
34. FIU stands for : Financial Intelligence Unit (India)
35. For Speed Clearing, no charges should be levied for cheques up to ___: Rs.1,00,000 and account should be credited within
48 hours
36. Foreign currency paid to taxi driver, shop keeper, can be accepted by: Authorised persons.
37. Full form of BCBS is Basel Committee on Banking Supervision.
38. Garnishee order is applicable for: credit balance in OD and not for cheque sent for collection.
39. Garnishee order is not applicable on: (a)cash received after two hours of receipt of Garnishee order (b) amount received for
safe custody (c) undrawn balances in cash credit accounts
40. Garnishee order is not applicable to: Unutilised portion of the Cash credit limit
41. Grace Period is allowed in the case of : Usance Bills and Usance Promissory Notes
42. Guarantee is defined in: Indian Contract Act
43. Guardian appointed by will of the father is called: testamentary guardian
44. How can be the transferability of Bill of exchange can be restricted? By making restrictive endorsement
45. How much charges are charged in addition to normal collection charges and out of pocket expenses for providing instant
credit facility for outstation cheques:Nil
46. If Power of Attorney is executed outside India it should be stamped within:90 days of its fi ist arrival in India
47. If time is not mentioned on a Bill of Exchange, it will be payable: on demand
48. In a Saving Bank Account A has given authority to X. X dies. A cheque signed by X is presented for payment. What should the
bank do?: Bank should make payment.
49. In Bimonthly policy review, RBI does not consider which of the following - Repo Rate, Bank Rate, Saving Bank rate?: Saving
Bank deposit rate
50. In case a forged note is detected in the cash tendered at bank counter, what should the bank do?: The Note should be
impounded and not returned to the tenderer.
51. In the case of individuals and HUF, tax will be deducted at source if the interest on term deposit in a financial year is : more
than Rs 10,000
52. Indian Banks are required to maintain minimum Capital Adequacy Ratio of : 9%
53. Inoperative accounts: 2 Years & above not operated.
54. Introducers liability / responsibility in case of an account holder defrauding Bank is : To assist the Bank in locating the a/c
holder - does not have legal liability
55. KYC and FIU in India are associated with: preventing money laundering
56. Loan given to a director can be waived: after permission of RBI.
57. Locker can be broken open after notice to the hirer if the same is not operated for: more than three years for mediur-n risk
category or one year for a higher risk category, and the locker-hirer does not respond nor operates the locker.
58. Locker should be broken open if it is not operated for _ year in case medium risk and _ year in case of high risk customers:
(3,1).
59. Maximum amount of deposit which a bank may ask while allowing locker facility to a customer: Advance rent for 3 years
and locker breaking charges
60. Maximum time within which reply must be given under Right to information act? 30 days
61. May I help you counter is to be provided by bank branches other than : Small branches
62. Money deposited after receiving order may be attached in the case of: attachment order
63. On, other than a negotiable instrument, what is the time period for payment of stamp duty, if the document is executed
outside India : 3 months
64. Original & duplicate draft presented simultaneously for payment: Duplicate should be paid & original should be returned.
65. Payments of a forged draft. Who will lodge FIR paying or collecting bank: Paying Bank.
66. Penalty for delay is per day if information is not furnished within prescribed time under Right to Information Act: Rs.
250 per day and maximum Rs. 25000.
67. Provision on standard assets to be shown in balance sheet in other liabilities and provisions. Provision for NPA is deducted
from gross advances.
68. Purpose of star series notes: To replace defectively printed notes
69. Revival of limitation for recovery of a time barred loan is possible by: obtaining fresh promise to pay under provisions of
Indian Contract Act.
70. RTI Act - party seeking information need not disclose the reasons for which the information sought for.
71. Safe deposit vault is governed by provisions of: Transfer of Property act
72. Tax at Source is deducted on interest on fixed deposit if interest paid / payable on a fixed deposit in a financial year is above
Rs. 10,000. This is as per: Section 194A of Income Tax Act.
73. The aggregate limit for capital market exposure of a Bank is: 40 0/0 of net worth at the end of previous year
74. The bill is dated 15/03/04, the date of acceptance: 20/03/04. The bill returned unpaid on 25/03/04. The limitation period
will be available up to : 25/03/07
75. The Garnishee Order is applicable on the account of a customer when the relationship between banker customer is: Debtor
& Creditor.
76. The liability of the drawer of bills of exchange is prime till it is not accepted by the drawee after that prime liability
becomes of Drawee.
77. The term used for conversion or transfer of property derived from a criminal offense for the purpose of concealing, or
disguising, the illicit origin of the property is called: Money laundering
78. Under Prevention of Money Laundering Act, banks are required to send cash transaction report in respect of cash deposit or
withdrawal of more than Rs 10 lakh in a month from one account within: 15 days from the close of the month.
79. Upto what amount District forum can be approached under Consumer Protection Act?: Rs.20 Lacs
80. What do we 'mean by Surrender Value of Life Insurance Policy?: Minimum amount payable by the insurance company in
case of foreclosure of the policy before maturity.
81. What is a Promissory Note: Unconditional promise to pay.
82. What is minor's liability in HUF Account: Minor is not liable
83. What is the relationship between bank and customer if he has left certain goods with the bank by mistake: Bank is trustee
and Customer is beneficiary
84. What is the time period for crediting proceeds of outstation cheques presented in Speed Clearing: 48 hours.
85. When a letter is signed by the borrower and based on that letter bank delivers the document of title to goods to the
borrower, such letter is called as: Trust Receipt
86. When principal and interest of a fixed deposit receipt is Rs 20,000 or above, it can not be paid in cash and has to be paid
only through credit to some account or issue of account payee cheque. This is as per provisions of which of the following Acts?
Income Tax Act.
87. When rate of interest is expressed by adjusting the impact of inflation, this is called : Real rate of Interest
88. Which of the following can open SB a/c? State Electricity Board/ Indian Bank Association/ Municipal corporation: Indian
Bank Association.
89. Which of the following documents does not constitute document of title to goods:Airway bill
90. Which of the following does not match in banker/customer relation : Locker facility - Bailee/Bailor
91. Which of the following un/under-stamped document can not be revalidated by paying penalty: None of these as all
documents can be revalidated. (However, as per question Demand Promisory note cannot be revalidated).
92. Which type of preferential shares are treated as part of Tier I capital of the Bank?: Perpetual Non Cumulative Preference
Shares.
93. Who is called as Holder as per N I Act?: Who is entitled to possession of the instrument in his own name (actual
possession is not necessary).
94. Who can seek information under.Right to Information Act: Any citizen of India can ask for information
95. Who is primarily liable on Bill of exchange which has been accepted?: Acceptor (Drawee) of the Bill.
CUSTOMERS & THEIR ACCOUNTS
Partnership
1. A document was executed by three partners in different dates. When shall the limitation period start?: The limitation period
will start from the last date i.e. when the document was executed by the last partner
2. A minor who was admitted to the benefits of partnership has become major. Within how much period, he has to decide to
remain partner in the firm or not?: within 6 months of attaining majority or 6 months of knowing that he is the partner in the firm
whichever is later.
3. A partnership firm conducting business other than the banking business has more than 100 members as partners. Whether
this is allowed?: Such association is called illegal association as per Companies Act
4. Account payee crossing defined in:-Not defined any where
5. HUF cannot be partner in a Partnership firm: HUF does not have any legal entity.
6. Implied authority of a partner does not allow ______ singly? Settle a dispute relating to the business of the firm thru
arbitration.
7. In Limited Liability Partnership account, who are not eligible for becoming partners: a) HUF b) Minor c) body corporate?:
Ans: a & b
8. Outstanding in a CC account is Rs.2.00 lakhs. One of the partner died and the operations were continued in the account
by the bank inspite of notice of the death given to the bank. Later 2.50 lakh deposited and 1 lakh was withdrawn? What is liability
of legal heirs of the deceased partner: NIL as per Claytons rule.
9. Position of minor on attaining the majority: He has to give public notice within 6 months on attaining majority as to whether
he wants to become partner or not. If he remains silent it is presumed that he has accepted to become the partner and he will be
liable for all transactions since he was admitted for the benefit of the partnership firms.
10. Reasons for avoiding advance to Un-Registered Partnership Firm: Firm can not sue against anyone for recovery of its debts
but anyone can sue against the firm.
11. The consequence of non registration of Partnership - firm cannot sue others for its dues.
12. The liabilities of partners in Partnership is: Joint and several
13. Who can not be full fledged partner: Minor
14. Who cannot become a partner in a firm as per supreme court judgment HUF
Companies
1. A bank cannot acquire either as owner or as pledgee shares in a company more than:. 10 % of paid capital of the company
or 10% of the•paid up capital and reserves of the bank, whichever is lower.
2. A limited company has registered office at Chennai whereas loan has been raised from bank branch at Mumbai. The charge
will be registered with the ROC at: Chennai
3. A private limited company with Registered office at Bangalore has raised loan from a branch located at Mumbai. For
creating equitable mortgage, title deeds can be deposited at: Mumbai, Kolkatta, Chennal or any other notified place.
4. Board of Directors want to borrow money in excess of paid up capital and reserves of the company: can be done through a
resolution passed by shareholders in the general meeting
5. CIN in case of a company indicates: Corporate Identity Number.
6. Company is in liquidation, funds are at the disposal of : Liquidator
7. For formation of a company, Registrar of Companies will issue : certificate of incorporation
8. In the case of IPO, the company is required to allot shares or make refund within: 30 days of the closure of the issue in case
of fixed price public issues; 15 days in case of book built issues and 15 days in case of right issues
9. Objectives for which a company has been formed are given in: Memorandum of Association
10. On repayment of_debt of a company, satisfaction of charge shbuld be filed with ROC within: 30 days
11. The Articles of Association mention that the minimum quorum for passing a resolution is 5 directors. However a
resolution is received which was signed by four directors only with a request to open the current account: All the 5 Directors
should sign the resolution for opening of the account
12. The legal liability to file charges with ROC in case of lending to a Company is that of ______: Borrowing Company
13. What is the Doctrine of Ultra Vires in the context of a limited company?: Any act by the directors beyond the object of the
company is considered ultra vires the company and company is not bound by such act.
14. When a company is financed against the security of hypothecation or mortgage of its movable property, the company is
required to file particulars of charge with: Registrar of Companies
RTI
1. As per Right to Information Act (RTI), in how much time the information is to be provided to the person seeking the
information: 30 days.
2. In case of RTI, information related to life and liberty has to be provided within: 48 hrs.
3. While disposing-off the request under RTI Act, PIO is required to mention clearly the time limit of _____ and address of the
Appellate Authority to the complainant: 30 days.
TRUST
1. 1. You are maintaining current account in the name of the Trust. You receive notice of death of one of the trustees. After
this notice, a cheque signed by the deceased trustee is presented for payment. What should the bank do?: Cheque may be paid, if
otherwise in order.
2. A Trust Deed is silent about loans by the trust. The trustee approaches for a loan. Under these circumstances what should
the bank do?: No loan can be raised
TDS
1. E TDS - 26Q (tax deduction other salaries) to be filed for the month of September, before: 15th October (Statement of TDS
to be submitted within 15 days from close of quarter)
2. In case of payment of rent on property, tax is deducted at source when the payment of rent is likely to be more than Rs
180,000 per annum. The rate of TDS in case of rent payable to an individual or HUF is: 10%
3. In which type of fixed Deposits Account TDS not deducted: NRE and FCNR(B) only.
4. Penalty for non submission e-TDS : Rs. 200 per day
5. Quarterly statement for TDS on salary should be submitted on form 24-Q within: 15days of the close of the quarter
6. Tax is not deducted at source in respect of which of the following income – (a) Interest on Bank deposits (b) Rent on land
and building (c) Brokerage (d) Dividend paid by listed company: Dividend paid by listed company (However Dividend u/s 2(22)(e) is
taxable for shareholder and thus TDS rate on such dividend is 10%
7. TDS collected to be deposited with the Income Tax Deptt within: 7th day of succeeding month during which it is collected.
8. TDS deducted for interest amt: above Rs 10,000/-.
9. TDS deduction on interest more than 20,000/- under IT Act : Sec. 194A
10. TDS not deposited in time. What is the interest payable?: _Bank to pay the amount with interest © 1.5% per month simple.
11. A customer aged 66 years has a term deposit in your branch. He does not want the TDS to be deducted, which declaration
form will you ask him to submit: 15-H
12. Citizen below 60yrs is required to fill which forms for non deduction of tax at source in case interest credited or likely to be
credited on FD in a financial year is more than Rs 10,000 – 15G/15H/Form 60/Form 61: 15G
MISC
1. A customer Mr Sharma had credit balance 40,000 in his saving ac and also had an OD ac with overdue Debit balance of
20,000.Bank debits his saving account and adjusts OD ac. The bank is said to have exercised Right of: Set-off
2. A Minor has extended Guarantee to a loan. It can be ratified by whom? It cannot be ratified by any one.
3. A savings account becomes inoperative when it not operated for: 2 years
4. A term deposit of a HUF has become due. At the time of renewal, the Karta of HUF informs that he has become Senior
Citizen. What rate of interest will be given on term deposit? : Normal interest rate. No benefit of senior citizen to be given
5. Additional interest is paid to senior citizens on which time FD: All fixed deposits (may vary from bank to bank)
6. After Nomination in an account, what is the status of the nominee?: Trustee of legal heirs
7. An account of a customer can be closed in normal course on the request of the customer. What are the other methods
for closing account of a customer – (a) By negotiation; (b) As per provisions of law; (c) After notice to customer in respect of
undesirable accounts: Ans is C
8. An Illiterate person is generally not allowed to open which account – saving, term deposit, recurring deposit, small account,
Current Account: Current account.
9. As per RBI guidelines, Demand draft of Rs 50,000 and above should be issued against : by debit to account but not against
cash
10. As per RBI guidelines, minimum amount of deposit to open BSBDA account is: NIL
11. As per Sukanya Samridhi Account (SSA) the tenure of deposit is for years from the date of opening of the account: 21
years
12. Bank is not required to produce original book of records but true copy can be submitted when court has demanded as per
which act? a) Civil procedure code b) Registration act c) B.R. Act d) RBI act e) Banker Books Evidence Act.
13. Banker Customer relationship for deposits is ____: Debtor – Creditor.
14. Banker customer relationship in Safe Custody: Bailee Bailor.
15. Banker customer relationship in standing instruction: Agent – Principal
16. Bankers prefer Saving Deposits than Term deposits. Why?: Because cost of deposits for SB is less.
17. Banks can decide interest rates of NRI, NRO or Term Deposits:Yes
18. Banks can raise what type of deposits?: Term and Demand Deposits
19. Banks should have the responsibility of currency management entrusted to a nodal official of the rank not less than that of a
General Manager and will be accountable for the obligations cast upon currency chests by the Reserve Bank.
20. BC work as : Bank’s Agent
21. Business Correspondent can be identified by whom?: BDO,Post Master, Head of Village Panchayat, other BC.
22. Business correspondents for banking for : serving weaker sections of society
23. Call money deposit is part of the sector : Organised sector
24. Complaints under Consumer forum should be dealt with within (Where no testing of commodities is required) : 90 days.
25. Customer OD A/c has overdrawn Rs 2000/-. Saving A/c has balance Rs 3000. The bank adjusts the OD A/c by which right: Set
off.
26. DD of Rs.50000/- in cash : not allowed
27. Death claim settlement in how many days?: 15 days
28. Deposits held in Joint accounts; b) Corporate Deposits; c)
Inter-Bank deposit; d) Deposits of HUFs: Ans is Inter-Bank deposits.
29. Deposits which are not claimed for__years are required to be transferred by banks to
RBI: 10 years
30. DICGC cover is available in which of the following cases a) Credit balance in Cash Credit Account b) Overdue Deposit c)
Deposit of Government Department?: A & B
31. Differential rate of interest can be paid on fixed deposit if single deposit is for: Rs.1.00 crore and above
32. Direct Tax Code will replace which of the following – Income Tax Act, Corporate Tax Act: Income Tax Act.
33. Encashment of FOR with interest - payment can be made in cash if it is less than Rs 20000
34. Financial Inclusion means: providing banking services at affordable cost to the poor/distressed.
35. FULL FORM OF CASA? : CURRENT ACCOUNT & SAVING ACCOUNT
36. Garnishee order is not applicable to: a) Savings b) Current c) FD d) CC/OD with debit balance: CC/OD with debit balance.
37. Govt. has decided to demonetize all the coins of paise 25 and below w.e.f. 30-6-2011.
38. How much amount can be deposited in a small account in a financial year?: Rs one lac
39. How much amount can be withdrawn from a small account in a month?: Rs 10,000
40. If in Garnishee Order no amount is mentioned, what should the bank do? Full amount to be attached.
41. If payment of Rs 20000/- is made in cash in case of FDR what is the penalty: equal to the amount paid
42. Illiterate account holder, how many witness for nomination: two
43. In Basic Savings Bank Deposit Account in all their accounts taken together and the total credit in all the accounts taken
together is not expected to exceed _____ in a year has been simplified to enable those belonging to low income groups without
documents of identity and proof of residence to open banks accounts: 1,00,000/-.
44. In case Fixed Deposits account the rate of interest fixed by whom: Board of Directors of respective bank.
45. In case of a/c transfer, with in how many days the address proof has to be submitted in the transferee branch? Six Months
46. In case of an illiterate customer, process of nomination requires witnesses by how many persons?: Thumb impression
requires 2 witnesses.
47. In case of Deposit Insurance whether it mandatory or not: It is Mandatory for all banks.
48. In case of Deposit Insurance, Insurance premium is paid to DICGC by bank and depositor in which ratio?: Entirely by bank.
49. In case of insurance of deposits by DICGC, premium is paid by: Bank. 100% of the premium is paid by the bank and not by
depositor.
50. In case of insurance of deposits by DICGC, what is the premium sharing ratio between bank and depositor?: 100% of
insurance premium is paid by the bank.
51. In case of Minor what is wrong? Minor can make himself liable for his actions.
52. IN CASE OF TRANSFER OF ACCOUNT, WITHIN HOW MANY DAYS, THE ACCOUNT HOLDER SHOULD ADVISE NEW
ADDRESS?: TWO WEEKS
53. In how many years of no transaction does a saving and current account become inoperative? : two years
54. In Limited liability Partnership what is the liability of partner?: Amount agreed to be contributed by partner at the time of
joining partnership.
55. In saving accounts, interest is calculated on the basis of: daily product basis.
56. In Senior Citizen Saving Scheme account, who can be joint account holder?:Spouse
57. In small accounts as per RBI- No min. balance, nil/minimal charges etc
58. In small accounts monthly withdrawals to be upto- Rs.10000/-
59. Insurance of deposit is done by DICGC up to: Rs 1 lac per depositor per bank.
60. Interest rate on Saving Deposit is decided by : Banks individually
61. Interest rate on Savings accounts: Not regulated by RBI
62. Max amt for tax saver FD: Rs 150000
63. Maximum amount of deposit in Tax Saving Scheme of the bank can be: Rs 1,50,000
64. Maximum deposit for allocating a locker: 3 year advance rent plus locker breaking charges
65. Maximum period of NRE deposit: Bank Discretion.
66. Minimum and Maximum amount that can be deposited in PPF account is _____: Minimum Rs. 500/- & Maximum Rs. 1.50
lacs.
67. Minimum Lock in period for Tax saver FDR: 5 Years
68. Minimum Maturity Period for Certificate of Deposit is : 7 days
69. Missing person treated as having expired if missing for: 7 years
70. No Frills Accounts are opened for: Financial Inclusion
71. No of digits in Aadhar : 12
72. Non Resident (External) fixed deposit is normally accepted for a period of (a) 1 year to 3 year (b) 1year to 5 year (c) 1 year to
4 year (d) 1 year to 7 year (e) 6 months to 3 year: 1 year to 3 year (As per RBI it is minimum 1 year and maximum bank discretion)
73. OD in PMJDY account upto: Rs. 5,000/-.
74. On a cheque presented for payment, amount is written in words but all other items are written in Regional Language. What
should the bank do?: Pay the cheque
75. Pensioner account can be opened jointly with? Spouse as Either of Survivor or Former or Survivor.
76. Rate of Interest in Sukanya Samridhi Account for 2015-16: 9.20% & 8.6% FOR 2016-17
77. Relation between bank and judgment debtor: debtor & creditor.
78. Safe custody of Articles comes under which Act: Indian Contract Act.
79. Star series note can be issued in denomination of Rs 100 also. (earlier only Rs 10, 20 & 50)
80. Super senior citizen after: 80 years of age
81. The balance in the account is Rs 15000. A cheque of Rs 30000 was sent for collection. Before it is realized a cheque for Rs
20000 has been presented for payment. What should the bank do – (a) Return with reason effects not yet cleared. Present again; (b)
Pay the cheque; (c) Return with reason exceeds arrangement; (d) Return with reason Refer to Drawer; (e) Return with reason
Insufficient Funds: Insufficient Funds
82. The minimum & maximum period of certificate of deposit is : 7 days, 12 months
83. There is a credit balance in the saving account and there is a overdraft in the current account amounting to Rs 555. Both
accounts are in the same name. Bank wants to adjust credit balance of saving bank account towards payment of overdraft. As per
which right, bank can do this?: Right of Set Off.
84. Under Sukanya Samridhi Account (SSA) the maximum period upto which the deposits can be made is for ___ years
from the date of opening of the account: 14 years
85. Under Sukanya Samridhi Account (SSA) the minimum amount of deposit is Rs 1,000 and Under Sukanya Samridhi Account
(SSA), the bank account will be opened for a girl child upto the age of: 10 years
86. Under Sukanya Samridhi Account (SSA), the current rate of interest on deposits is which is the highest amongst all other
Govt. Saving Schemes: 9.20% & 8.6% FOR 2016-17
87. What are the Service charges for using ATMs of other banks for balance enquiries: Rs.20 for Financial & Rs. 10 for Non-
Financial upto 5 transactions ( 3 at Metros)
88. What documents are required for opening a small account?: Self attested photo and address
89. What is the bankers-customer relationship in case of deposits? Debtor – Creditor
90. What is the distance criteria for office of Business Correspondent?: The distance between the place of business of a retail
outlet/sub-agent of BC and the base branch should ordinarily not exceed 30 kms in rural, semi-urban and urban areas and 5 kms in
metropolitan centers.
91. What is the maximum amount of loan that can be granted against FCNR deposit? No limit.
92. What is the periodicity of review of risk classification of customers?: Every six months
93. What is the rate of interest payable on an overdue FD for overdue period if customer demands payment and does not
renew the same?: Saving Bank Rate
94. What is the special feature of Basic banking Account? Account can be opened with nil or very small amount and there are
no requirement of minimum balance.
95. What type of account can be opened in the name of NRI jointly with residents? NRO /NRE/FCNR (earlier only NRO)
96. What type of activity can be performed by Business Correspondent - (a) processing and submission of applications to banks;
(b) disbursal of small value credit, (c) recovery of principal / collection of interest (iv) collection of small value deposits: All of these
97. When a person wants to open an account with a bank but does not have proof of identification and address, what type of
account can be opened?: Small account
98. When Letter of Administration issued: When the person dies without leaving the Will- Intestate.
99. Whether “WILL” has to be registered? Not required.
100. Which form is used for cancellation of nomination in deposit accounts?: DA -2
101. Which is not a proof of Identity?: Ration card.
102. Which is the most important document for opening a Trust Account?: Trust Deed
103. Which of the following forms will be used for allowing exemption to a depositor aged 61 years : Form 15 H
104. Which of these rates are periodically reviewed by RBI?: Repo rate, Bank rate, but not Savings Bank Rate.
105. While opening account, a bank, in addition to observing various provisions of Indian Contract Act should also – exercise
utmost care and attention; look at profitability from account; exercise due diligence: Due diligence
106. While opening the account with a bank, prospective customer is required to submit – PAN No or Form 60 or 61
107. Who are eligible for preferential rate of interest under NRE deposits: a) Staff b) Senior citizen c) Staff cum Senior Citizen d)
none of these?: None of these
108. Who can do nomination in the account of a Minor?: Can be done by guardian not by minor
109. Who of the following can exercise nomination – HUF, limited company, trust, Partnership firm, sole proprietorship firm?:
Sole Proprietorship firm.
KYC/AML
1. Cash receipt or cash payment of more than Rs 10 lakh are reported to FIU on CTR statement which should be sent to FIU
within _____ from the close of the month: 15 days.
2. Suspicious Transaction report is sent to FIU within: 7 days from confirmation of suspicion.
3. In case of transactions carried out by a non-account based customer, that is a walk-in customer, where the amount of transaction
is equal to or exceeds rupees whether conducted as a single transaction or several transactions that appear to be connected, the customer's
identity and address should be verified: fifty thousand
4. As per KYC norms, banks are required to periodical update data. In respect of High risk customers, full KYC exercise will be
required to be done at least every: two years
5. As per KYC norms, for how much period banks are required to preserve records in respect of photograph and proof of
address or identity?: 5 years from date of close of account
6. As per KYC norms, in the event of change in this address due to relocation or any other reason, customers may intimate the
new address for correspondence to the bank within: two weeks of such a change
7. As per KYC norms, risk classification of customers should be reviewed in every: 6 Months
8. Banks are required to FIU, cash transactions which are integrally connected to each other and total amount of receipt or
total amount of payment in a month is more than: Rs 10 lac
9. Cash Transaction Report (CTR) in respect of cash receipt or cash payment of more than Rs 10 lac is to be sent to Director –
FIU. What is the periodicity of the report – Fortnightly, Monthly, Quarterly, half yearly: Monthly, within 15 days of the close of the
month.
10. FIR to be filed if number of Counterfeit notes in a single deposit is: 5 or above
11. If a customer does not comply with KYC requirements despite repeated reminders by banks, banks should
impose ‘partial freezing’ by allowing all credits and disallowing all debits with the freedom to close the accounts after
____ months notice followed by a reminder for further period of ____months. If the accounts are still KYC non-
compliant after _____months of imposing initial ‘partial freezing’ banks may disallow all debits and credits from/to the
accounts, rendering them inoperative: 3, 3, 6 months.
12. In a cash deposit made by a customer, one piece of counterfeit note is detected. What should the bank do - (i) It should be
impounded and acknowledgement to be issued(ii) Should be destroyed (iii) Should be returned back: It should be impounded and
acknowledgement to be issued to depositor signed by cashier.
13. In case of counterfeit notes received in a deposit by a person with bank, FIR is not lodged and only a monthly
consolidated report is sent if counterfeit notes in one remittance is up to: 4
14. In case of Non-KYC compliant customer, after how much time notice, account should be freezed?: 3 months notice
15. In respect of Low Risk customers, KYC norms relating to obtaining photograph and proof of address and ID should be
applied once in: 10 Years
16. In respect of Medium Risk customers, KYC norms relating to obtaining photograph and proof of address and ID should be
applied once in: 8 Years
17. Process of making illegally-gained proceeds (i.e. "dirty money") appear legal (i.e. "clean") is called: Money Laundering
18. RBI has allowed banks to accept at least _____ of the documents prescribed by RBI as activity proof by a proprietary
concern, for opening a bank account in respect of a sole proprietary firm: One
19. What is the Risk category of Trust account High/Low/medium risk?: High Risk
20. When in case of deposit of cash over counter, two counterfeit notes are detected by bank, what should the bank do – (a) To
be returned to customer, (b) impounded immediately, (c) call the police, (d) destroy it: impound immediately and issue
acknowledgement to tender signed by the cashier
21. While opening bank account, as per KYC norms, what another document is taken by bank in addition to proof of ID?: proof
of address ( Both can be same also)
22. Relaxation in KYC norms is permitted if the depositor undertakes that the balance outstanding in his account will not be
more than and credits in a financial year will not exceed . Rs 50,000; Rs 100,000
23. Why KYC guidelines have been issued by RBI under section 35 A of the Banking Regulation Act: To prevent Money
Laundering -
24. The terms used for hiding money to avoid tax is : Money laundering
25. Money laundering: conversion of illegal money into legal through banking channels.
26. For the purpose of KYC rules any addition & modification on which recommendation: Financial Action Task Force
27. Risk type for customer having political exposed person: High Risk
28. As per KYC Guidelines, Records of transactions to be maintained for at least ten years from the dateof transaction, instead
of _________from the date of cessation of transactions, and records pertaining to identification of the customer and his address to be
preserved for at least ten years after the business relationship is ended: ten years
29. A customer who does not complete all KYC norms, what type of account is opened for him? No Frill account in which cannot
be more than Rs.50000 and credits in the Financial Year cannot be more than Rs.100000.
30. There were three cash withdrawals of Rs 5.80 lac ,Rs 4.90 lac & 0.25 lacs from an account in a month. Which of these
transactions is/are will be reported to Financial Intelligence Unit as part of CTR? Cash withdrawals of Rs 5.8 lac and Rs 4.9 lac.
31. Under Prevention of Money Laundering Act, banks are required to preserve records relating to opening the account for how
much period?: 10 years from date of closure of account.
32. Which of the following is not the key element of KYC policy a) Customer Acceptance Policy; b) Customer Identification
Procedures; c) Monitoring of Transactions; d) Risk Management e) Customer Awareness Policy: Ans is E i.e. Customer Awareness
Policy.
33. On whose recommendations, KYC norms came into force? (a) Goiporia Committee (b) Ghosh Committee (c) FATF: Ans is
FATF
34. Under KYC Norms, Documents relating to opening the account like proof of address and identity and photograph should be
taken again at what interval? (a) once in 10 years for low risk customer (b) once in 8 years for medium risk customers (c) once in 1
year for high risk customers (d) Both (a) and (b): Ans is (d)
35. Record of cash receipt and payment under KYC to be maintained if cash receipt or payment in a single day from one account
is more than Rs 10 lakh.
For Low Risk customers, periodical up-dation of KYC data: Once in 10 years
LOANS AND ADVANCES
1. Ã housing loan in metro area will be classified as Priority Sector, provided maximum amount of loan is up to ___ and
maximum cost of house is up to: Rs. 28 lac; Rs 35 lac.
2. ȂƌĞĚŝƚZĂƟŶŐŐĞŶĐŝĞƐŝŶ/ŶĚŝĂĂƌĞƌĞŐƵůĂƚĞĚďǇ͗Z /
3. ˜CRISIL stands for: Credit Rating Information Services of India Ltd.
4. ˜Deferred Payment Guarantee is : Guarantee issued
when payment by applicant of guarantee is to be made in installments over a period of time.
5. Ȃ&ŽƌĐƌĞĂƟŽŶŽĨƋƵŝƚĂďůĞD ŽƌƚŐĂŐĞŽŶŐƌŝĐƵůƚƵƌĂůůĂŶd, property is to be located at: a) Any notified area b) In
cantonment area c) In metro cities d) Any where in India: Ans is D.
6. ˜Mortgage loans for Employees - take home pay, after deduction of proposed loan instalment, should not be less than
______ of gross salary: 40%.
7. ȂZŽŚŝƚǁ ĂƐĂůŽĂŶĞĞŽĨƚŚĞďƌĂŶĐŚĂŶĚŶĞǁ ƐŚĂƐĐŽŵĞƚŚĂƚŚĞŚĂƐĞǆƉŝƌĞĚ͘ K ŶĞŶƋƵŝƌǇ͕ŝƚǁ ĂƐŽďƐĞƌǀ ĞĚƚŚĂƚŚĞůĞŌƐŽŵĞ
assets. Upto what extent the legal heirs are liable to the Bank? Legal heirs are liable for the liabilities upto the assets inherited by
them.
8. ˜The appraisal of Deferred Payment Guarantee is same as that of a) Demand Loan b) OD c) Term Loan d) CC : Term Loan.
9. Ȃt ŚĂƚŝƐƚŚĞůŝŵŝƚĂƟŽŶƉĞƌŝŽĚǁ ŚĞŶ' Žǀ ƚ͘ ǁ ĂŶƚƐƚŽƚĂŬĞůĞŐĂůĂĐƟŽŶĨŽƌƌĞĐŽǀ ĞƌǇŽĨŝƚƐĚƵĞƐ͗ ϯ ϬǇĞĂƌƐ͘
10. A guarantee issued for a series of transactions is called: Continuing guarantee
11. A lady who has taken a demand loan against FD come to the branch and wants to add name of her minor son, as joint a/c
holder. What you will do?: Name can be added only after adjustment of the loan.
12. A letter of credit which is issued on request of the beneficiary in favour of his supplier: Back to Back LC
13. A loan is given by the bank on hypothecation of stock to Mr. A. Bank receives seizure order from State Govt. What should
bank do?: Bank will first adjust its dues and surplus if any wilt be shared with the Govt.
14. A loan was sanctioned against a vacant land. Subsequently a house was constructed at the site. What security is available
now to the bank? : Both
15. A minor was given loan. On attaining majority he acknowledges having taken loan and promises to pay. Whether the loan
can be recovered? : He can not ratify the contract. Hence recovery not possible.
16. A negotiating bank and issuing bank are allowed days each for scrutiny of documents drawn under Letter of credit to
ensure that documents are as per LC: 5 banking days each.
17. Acknowledgement of Debt can be obtained for how many number of times : No limit
18. Advance to a company against Trust receipt where document of title goods transferred to bank and goods to be
released against payment by the company. Whether a charge is to be registered with the Registrar of Companies under MCA
21?: Not Required
19. Age limit staff housing loan: 70 years;
20. An L/C is expiring on 10.05.2008. A commotion takes place in the area and bank could not open. Under these circumstances
can the LC be negotiated?: The L/C can not be negotiated because expiry date of LC can not be extended if banks are closed for
reasons beyond their control.
21. As per internal policy of certain banks, the net worth of a firm does not include: a. Paid up capital b. Free Reserve c. Share
Premium d. Equity received from Foreign Investor : Revaluation Reserves
22. Authorised capital is Rs.10 lac. Paid up capital Rs.6 lac. The loss of previous year is Rs.1 lac. Loss in current year is Rs3 _ lac.
The tangible net worth is : Rs.2 lac
23. Authorised capital= 10 lac, paid-up capital = 60%, loss during current year = 50000, loss last year = 2 lacs, what is the
tangible net worth of the company? : 3.5 lac
24. Bailment of goods by a person to another person, to secure a loan is called : Pledge
25. Balance outstanding in a CC limit is Rs.9 lakh. Value of stock is Rs.5 lakhs. It is in doubtfUl for more than two years as on 31
March 2012. What is the amount of provision to be made on 31-03-2013?: Rs.9 lakhs (100% of liability as account is doubtful for more
than 3 years)
26. Balance Sheet of a firm indicates which of the following – Balance Sheet indicates what a firm owes and what a firm owns
as on a particular date.
27. Bank limit for working capital based on turn over method: 20% of the projected sales turnover accepted by Banks
28. Banks are required to declare their financial results quarterly as per provisions of : SEBI
29. Banks are required to maintain -a margin of ___ for issuing Guarantee favouring stock exchange on behalf of share
Brokers.
30. Banks are required to obtain audited financial papers from non corporate borrowers for granting working capital limit of:
Rs.25 lakh &above
31. Bank's charge over LIC Policy is created by: Assignment
32. Banks provide term loans and deferred payment guarantee to finance capital assets like plant and machinery. What is the
difference between these two: Outlay of funds.
33. Benchmark Current Ratio under turn over method is: 1.25
34. Break Even Point: No profit no loss. ( TR-TC=Zero)
35. Calculate Debt Equity ratio – Debenture – Rs 200, capital 50; reserves – 80; P& L account credit balance – Rs 20: 4: 3 ( 200
divided by 150).
36. Calculate Net working capital– Total assets 1000; Long Term liabilities 400; Fixed assets, Intangible assets and Non current
assets (i.e. long term uses) Rs 350; What is net working capital : 400- 350= Rs 50
37. Calculate Tangible Net Worth: Land and building: 200 Lacs; Capital:80000 intangible asset:15000: 65,000
38. CALCULATION OF INTEREST IN LOAN ACCOUNT: MONTHLY
39. CARE stands for : Credit Analysis & Research Ltd
40. Cash Budget method is used for sanctioning working capital limits to : Seasonal Industries
41. CC limit Rs 4 lacs. Stock 6 lacs. Margin 25% . What is drawing power? : NOTIONAL - 4.5 lacs, BUT ACTUAL Rs. 4 LAC.
42. Central Registry of Securitization Asset Reconstruction and Security Interest of India (CERSAI) is a government company
licensed under Section 25 of the Companies Act, has been incorporated to operate and maintain the Central Registry under the
provisions of _____: SARFAESI Act 2002.
43. CIBIL is the agency that provides information to the member banks on (i) Credit Rating (ii) Information on credit History:
Information on Credit History of borrowers
44. Contribution means : profit + fixed cost
45. Current Assets 600, Long Term sources - 600, Total Assests1000, what is NWC and Current Ratio: CR 1.5 : 1; NWC = 200 .
46. Current Liabilities are those liabilities which are to be paid: within one Year
47. Current Ratio = 2:1, Net working Capital=60000, What is the Current Liability of the firm? : 60000
48. Current ratio indicates: Liquidity of the firm (ability of a firm to pay current liabilities in time)
49. Current Ratio is 1.33:1, Current Assets is 100, what will be the amount of Current Liability: 75 lakhs
50. Debt Equity Ratio indicates: Long term solvency or capital structure of the firm.
51. Debt Securitization refers to: Conversion of receivables into debt instruments.
52. Debt Service coverage ratio is used for: Sanction of Term Loans
53. Deferred Payment guarantee is: Financial Guarantee
54. Deferred payment guarantee issued by a bank is a : Contingent Liability.
55. Difference between Long Term Source and Long Term Use is called: Net Working capital.
56. DSCR indicates: Ability of firm to repay term loan instalments
57. DSCR is for evaluating: Term Loan repayment-surplus generating capacity.
58. Duty of confirming bank: Only to verify the genuineness of L/C.
59. Equitable Mortgage is created by deposit of title deeds with bank at – (a) any where in India; (b) state capital; (c) only at
Mumbai, Chennai or Kolkatta; (d) Any place notified by state government for this purpose: Correct answer is (d).
60. Excess of current liability over current assets means the firm may face difficulties in meeting its financial obligations in
short term.
61. Expand CRILC: Central Repository of Information on large credits.
62. Expand IRR : Internal Rate of Return
63. Finance for construction of road and port is classified as: Infrastructure Finance.
64. For ascertaining that a firm will be able to generate sufficient profit to repay instalments of term loan, which ratio is
computed?: Debt Service Coverage Ratio
65. For assessing Fund Based Working Capital limit for MSME upto _______Turnover method is followed under Nayak
committee: Rs.5 crore.
66. For classification of assets in consortium accounts, which of the following is to be considered?: In consortium accounts,
each bank will classify the account as per its record of recovery.
67. For Housing Loan of Rs.30 lac, Risk weight is: 35% if Loan to Value Ratio is up to 80% & above 80%, RWA -50%.
68. For Housing Loans, maximum amount of EMI that can be permitted for salaried class, is to be taken as _______of net salary:
50%.
69. For Seasonal industries such as tea, sugar etc, what type of method is used to sanction working capital requirements
______: Cash Budget Method
70. For Takeover of accounts from other Banks, the account copies of all the borrower accounts with the present bankers /
financial institution shall be obtained at least for the last ______: 12 months.
71. For the purpose of creation of equitable mortgage, the place for deposit of the title deed is notified by : State Govt
72. For the purpose of creation of equitable mortgage, the place for deposit of the title deed is notified by : State Govt.
73. Formation of consortium, when essential : When bank touches its exposure ceiling
74. Full form of DSCR: Debt Service coverage ratio;
75. Gold is pledged with bank as security for a Bank Guarantee by a borrower. Bank Guarantee stands expired. Whether a
temporary overdraft availed by the borrower which is overdue can be got adjusted by selling the Gold held as security for issue of
guarantee: Yes, because Bankers lien is a general lien and is an implied pledge. Further, the Gold was deposited in the ordinary course
of business.
76. Green field project is related to : setting up new projects
77. Guarantee issued by a bank in favour of Custom department that party will fulfill export obligation for availing exemption
from custom duty regarding tax. Such guarantee is called: Financial Guarantee
78. Guarantee issued by a bank which is still outstanding is shown in the Balance Sheet as: Contingent Liability.
79. Guarantors Liability: Recall the a/c and cause demand against the borrower and guarantor. Balance in guarantor's SB a/c
cannot be appropriated directly.
80. Holiday period given for repayment of installements in a loan is termed as: Moratorium period
81. How DSCR is calculated?: (Profitafter tax + Depreciation + Interest on Term Loan) divided by (Annual instalment of term
loan+ interest on term loan)
82. How much additional risk weight has been provided on restructured loans?: 25%
83. Hypothecation can be converted to pledge by: taking possession with the consent of the borrower.
84. Hypothecation described under SARFEASI Act.
85. If a LC contains a clause "about" regarding the amount and quantity of goods, how much tolerance is permitted?: 10%
86. If current ratio is 2:1, net working capital is Rs 20,000, current asset will be: Rs 40,000
87. If debtors are Rs 4 lac, annual sale is 60 lac, what is the Debt collection period: 0.8 months
88. If Debtors velocity ratio increases, it means debt collection period has increased or sales have decreased.
89. If documents are to be presented in about July month: these can be presented within 5 days before or 5 days after.
90. If in a Guarantee issued is silent, what will be the limitation period: 3 yrs and in case of Govt guarantee it is 30 years.
91. If in a LC words around is written with date then variation of is allowed in the period: +/- 5 calendar days
92. If on a letter of credit it is not mentioned whether it is revocable or irrevocable, then as UCPDC 600, it will be treated as :
Irrevocable LC
93. If on a Letter of Credit, date is mentioned as "end of the month", then as per UCPDC 600, it will mean: 21st to last day of
the month.
94. If stock statement is not submitted for 3 months from its due date and DP is allowed on the basis of old stock report, then
the account will be considered NPA after:90 days
95. If the projected sale of a-small (manufacturing) enterprise is Rs 80 lakh, margin available with the borrower is Rs 4 lakh,
then as per turnover method, working capital limit will be: Rs 16 lakh.
96. If working capital limit to a borrower is Rs 10 crore and above, then as per RBI guidelines, the loan component should be at
least: as per bank's discretion.(earlier it used to be 80%).
97. In a company, the registration of charges is required for: a)loan against FD b)lien on Govt Securities c) assignment of Book
Debts d) lien on Shares : Book Debts
98. In A current account OD of Rs. 12000 is made. The FDR has become due later on if the right of appropriation can be used.
The borrower has objected that he never requested for overdraft, hence payment can not be appropriated. The customer is right.
99. In a letter of credit, it is written that documents can be negotiated about 30th June. In this case, the documents can be
negotiated: Before or after 5 clays of 30th June.
100. In case of a loan under consortium, each bank can have Maximum working capital limit of Rs-No rule in this regard. Rules
of consortium to be framed by members of consortium.
101. In case of Gold loan what is the nature of charge: Pledge
102. in case of loan against bank deposit charge is created by: assignment
103. in case of loan against NSC, charge is created by: assignment
104. In case of loan given by more than one bank under a consortium, how the asset classification is done by various banks?:
Each bank will classify the account based on its record of recovery.
105. In case of revaluation of fixed assets, what percentage of revaluation reserve will be added to Tier II capital of the bank?:
45%
106. In Letter Of Credit jmporter is called: Opener of Letter of Credit
107. In project finance, Debt Equity Ratio requirement for other than Infrastructure finance is: 2:1
108. In respect of a project report, the feasibility which is given least importance by the preparers of the report, but very
important for a banker is : a) Commercial b) Technical c) economic d) financial Ans: C
109. In the Balance Sheet of a bank, Contingent Liabilities are shown as: footnote to the Balance Sheet.
110. In the case of advance to a limited company for purchase of vehicle, the charge is registered with Regional Transport
Authority in addition to registration of charge with. Registrar of Companies. Why this is done?:So that borrower can not sell the
vehicle without intimation to the bank
111. In the case of hypothecation : both possession &ownership is with borrower
112. In the case of Hypothecation: neither possession nor ownership come to Bank.
113. In which of the following cases, the document is required to be attested by two witnesses?: (a) Pledge (b) Hypothecation
(c) Mortgage (d) Lien
instructions (d) mention of debt in a communication to another person. : None of these
114. Interest rate on advances is related to – Bank rate; Base Rate; PLR: MCLR Rate
115. Limit sanctioned Rs 5 lac; Stock Rs 6 lac; Margin 25%; What will be Drawing power: Rs 4.5 lac
116. Limitation of demand Promissory Note is ______: Three years.
117. Limitation period for mortgage suit by bank: 12 years.
118. Loan against security of Life Insurance policy is given on the basis of: Surrender value.
119. Loan assets are classified by the banks on the basis of : Primarily by record of recovery and by status of security
120. Loan Delivery System is not applicable to: a) Loan to Soft ware industry b) export credit: export credit
121. Loan Delivery System suggested by Rashid Mani Committee is applicable on borrowers with working capital limits of: Rs 10
crore and above
122. Loan is in the name of A&B. Both have signed documents. A signs the Balance Confirmation but B does not. In this case
limitation will extend against: both
123. Loan to individual against shares in physical form : Rs. 10 lacs ( Demat form 20 lacs – 25% margin)
124. Lorry Receipts issued by Transport Operators approved by IBA are preferred. The reason is the Transport Operators will take
care of: Carriers Risk.
125. Max loan against shares in demat form: Rs 20 lakh.
126. Maximum number of members in a private limited company can be: 200
127. Meaning of accrual concept: Mercantile system.
128. Method used for calculation of bank finance for working capital up to Rs.2 crore to small Service enterprises? Simplified
turnover method
129. Mortgage is defined under: Transfer of Property Act.
130. Mortgage which is created by deposit of title deeds is called: Equitable Mortgage
131. Negative Lien means. Undertaking given by the company not to create any charge with any other bank till the currency of
bank borrowings.
132. Net working capital is : Current Assets minus Current Liabilities or Long Term Sources minus Long Term Uses
133. Normally bank can not grant advance to its directors. However, there are certain exemptions to this rule. Thus a bank can
grant a loan to its director against the security of: Government securities, life insurance policies or fixed deposit;
134. Off Balance sheet / On Balance sheet exposure- if altered the risk will be Credit Risk.
135. On maturity of bank guarantee, an intimation is send to customer and if no response received in 30 days, vouchers are
reversed. This is done for following reason? Bank has to maintain capital on Bank Guarantee for the purpose of capital adequacy
norms.
136. Particulars of satisfaction of charge by a company are to be filed within: 30 days from date of adjustment of loan.
137. Perpetual bonds and perpetual non cumulative preference shares as part of tier I capital can be up to% of tier I capital: 40%
138. Pledge is: Bailment of Goods to secure payment of a debt.
139. Preoperative expenses forms part of the following: Intangible assets
140. Process of converting physical shares into electronic form: dematerialization.
141. Property equitably mortgaged on 08/03/08. A registered mortgaged created on this property, on 05/03/2008 which was got
registered on 08/03/2008. Which will have priority: registered mortgage as it was created earlier.
142. Provisions on standard Assets are shown under which head in the balance sheet of the Bank?: Other Liabilities and
Provisions on Liabilities side.
143. Reserve for contingencies are shown in the Balance Sheet under: Own funds
144. ___ Return on Investment is calculated to ascertain of the unit.: Profitability
145. Reverse Mortgage loan is granted to: Senior Citizens
146. RIGHT OF CREDITOR TO REATIN THE POSSESSION OF GOODS N SECURITY BELONGING TO THE DEBTOR TILL THE
DEBT DUE TO HIM ARE PAID? : LIEN
147. Right of foreclosure is available in which type of mortgage? Mortgage by Conditional sale.
148. Stamp duty in usance bill of exchange: 0.25 per 1000 / 0.75 per 1000 / 1 per 1000 / none : It is according to value and time
i.e. Advalorem (it is Rs 0.65-per Rs 1000 up to 3 months usance)
149. Stand by LC is just like : Financial guarantee (A guarantee of payment issued by a bank on behalf of a client that is used as
"payment of last resort" should the client fail to fulfill a contractual commitment with a third party. Standby letters of credit are
created as a sign of good faith in business transactions, and are proof of a buyer's credit quality and repayment abilities)
150. Standard Score under CIBIL: 300 to 900
151. THE APPRAISAL OF DEFERRED PAYMENT GUARANTEE IS SIMILAR TO: TERM LOAN
152. The Audited Balance sheet for the latest financial year is to be obtained within ______ to finalise credit rating and re-fix
interest accordingly: 6 months.
153. The Bank did not disclose all material facts regarding loan to the guarantor while obtaining guarantee. Can guarantor
escape liability?: Guarantor cannot escape from his liability as it is not necessary to disclose all the materials facts with regards to the
loan.
154. The Borrower has to bring funds as his contribution for loan from: Long term Sources
155. The charge on stocks is created by: Hypothecation ( also by pledge or lien)
156. The concept of Base Rate is not applicable in the case of: Loan against Bank’s own deposit
157. The procedure used for ascertaining Customers Credit worth is called: Credit Rating
158. Time Limit for registration of equitable mortgage with CERSAI: 30 days from date of deposit of title deeds. (Normally
30days and then delay can be condoned up to 30days on payment of penalty).
159. Under equitable mortgage by way of deposit of title deeds, the property must be situated where: Property can be situated
anywhere but the deposit of title deed should be at any notified town notified by state govt.
160. Under multiple banking system, exchange of information between the banks is to be done for the limits of crores and
above and periodicity is : Rs.5 crores and Quarterly
161. Variable cost: Which varies with level of production.
162. What are the charges charged by CERSAI for creation of charge up to Rs 5 lac?: Rs 250
163. What are the rules relating to advance against Kisan Vikas Petra?: It can be granted provided KVP is assigned to the bank.
164. What can be maximum LTV Ratio for Home Loan up to Rs 30 lakh?: 90%
165. What charge to be created for demat shares with bank as security: Lien
166. What increases a capital of a person: a) Profit b) Loss c ) Depreciation d) Sale of an asset: Profit.
167. What is "pari passu" means: Sharing in the ratio of outstanding.
168. What is a Break even point-The level of sales at which a firm does not earn any profit and does not incur any loss.
169. What is cash loss : net loss before depreciation (Net loss minus depreciation)
170. What is Deffered Payment Guarantee?: Guarantee issued when payment by applicant of guarantee is to be made in
instalments over a period of time.
171. What is Mortgage? Transfer of interest in specific immovable property to secure an existing or future debt.
172. What is nature of Banker's Lien?: It is implied pledge because Banker can dispose-off the goods after giving notice to the
borrower.
173. What is Pari Passu charge?: In case of consortium advance sale proceeds of security will be shared among banks in
proportion to their outstanding.
174. What is Real Rate of Interest?: Prevailing interest rate minus inflation rate
175. What is the meaning of Group in Exposure Norms: Commonality of management & Effective Control
176. What is the relationship between bank and customers in case of overdraft?: Creditor and Debtor
177. What is the risk weight for Personal Loans? 125%
178. What is the risk weight for Unrated companies?: 100%
179. What is the type of liability for the bank on account of issue of Bank Guarantee?: Contingent Liability
180. What is time limitation for execution of decree: 12 years.
181. What type of bank gaurentee bank gives when a customer purchases a machine on instalment basis?: Deferred Payment
guarantee.
182. What type of charge is created on FDR: Assignment
183. What type of charge is created on Land and building?: Mortgage
184. What type of Guarantee is Deffered Payment Guarantee: Financial Guarantee
185. What type of liability is represented by Bank Guarantee?: Contingent Liability and shown as a footnote in the Balance
Sheet.
186. What will be the tangible net worth if total assets are Rs 35 crore; total outside liability Rs 30 crore; intangible assets Rs 3
crore: Rs 2 crore
187. What will happen in case of negative working capital limit: Current Liabilities are more than Current Assets
188. When a borrower repays the total loan amount, within how many days security documents should be released to
borrower?: 15 days.
189. When a charge is created by hypothecation of moveable goods or security who will have ownership and who will have
possession?: Both ownership and possession are with the borrower.
190. When a loan is recovered from guarantor for dues payable by the Principal Debtor, debtor becomes entitled to all rights
and remedies which the creditor had against the Principal Debtor. This right of guarantor is called: Right of subrogation.
191. When guarantor on payment of all dues to principal debtor, he gets which rights as that of creditor? a) Subrogation b)
Lien c) Assignment d)Pledge.- a
192. When limitation will not extend: Balance Confirmation signed after expiry of limitation period
193. When ownership with the borrower but possession with the bank, the charge is: Pledge
194. Where can title deeds be deposited for equitable mortgage? Any notified Place
195. Which is not a Credit Rating Agency – CRISIL, CARE, SMERA, ICRA, CIBIL: CIBIL
196. Which is not found in operating expenses statement of P&L statement - Salaries, Rent, Power: Power
197. Which is not included in Contingent liability – Bank Guarantee; Letter of Credit; Forward Contract; Bills Payable: Bills
payable
198. Which of the following is a contingent liability – deposits, borrowings, capital, guarantee: Bank Guarantee
199. Which of the following is a Credit Information company – CIBIL, FIMDA, AMFI, CRISIL: CRISIL
200. Which of the following is a current liability?: Bills payable
201. Which of the following is correct regarding reverse mortgage?: The scheme is available to senior citizens only; the property
should be self occupied by the owner.
202. Which of the following is Intangible Assets: a) Stock; b) Book debt more than 6 month old; c) Goodwill: Goodwill.
203. Which of the following is not an acknowledgement of debt: (a) written acknowledgement of debt (b) details of
debt mentioned in insolvency petition (c) part payment of debt as per standing iinstructions (d) mention of debt in a
communication to another person. : None of these
204. Which of the following is part of infrastructure project Schools & Hospital
205. Which of the following is part of the Solvency Ratios: debt equity ratio.
206. Which of the following represent Debt Service Coverage Ratio: (Net Profit after tax + Depreciation + Interest on Term
loan) divided by (Annual instalment of term loan + interest on term loan)
207. Which of the items will not be an asset in banks bal sheet: Advances/Fixed Asset / Deposits : Deposits
208. Which one of following is credit information company?: Equifax
209. Which system replaced Benchmark Prime Lending rate in banks: Base Rate
210. While arriving Drawing Power for financing against book debts, only Book Debts _____and below are to be taken in to
consideration. (other than MSME advances): 90 days
211. While doing Project Appraisal, sensitivity analysis is useful for: Viability and sustainability of project.
212. While financing for TL, Bank should look for the ability of the firm to generate the income to service the debt
213. While granting loans to a partnership, banks generally insist that the firm should be registered whereas registration of a
partnership firm is optional. What is the reason for the same?: An unregistered firm can not sue its debtors for recovery of its dues
whereas other can sue the firm for recovery of their dues
214. While undertaking technical appraisal, the following is not considered: cost of production and sales (it is used for economic
viability).
215. Who is bound to file particulars of charge with the Registrar of Companies under MCA 21, when a company creates
charge of somebody on its movable or immovable property except by way of pledge?: officials of the company.
216. Why banks do not grant loan to a minor?: A minor is not competent to contract Therefore, Ioan given to a minor can not
be recovered.
217. Why banks ensure that charge created on any asset of the company should be registered with ROC within stipulated
period?: If charge is not registered, bank will become unsecured creditor.
218. Why banks prefer financing of bills?: because the advance is self liquidating
219. Why fund flow statement is taken from the borrower?: To know sources from where funds have been raised and how funds
have been utilized and to know changes in net working capital position.
220. Why loan against Partly Paid Shares are not preferred by banks?: Because partly paid shares represent contingent liability.
In case company makes demand and the borrower does not pay the amount then the bank will have to pay the amount otherwise
share may be forfeited. Moreover it is prohibited by RBI
221. Working capital requirement of a firm is required to be met through : Short term sources and surplus of long term sources
over long term uses
222. You have sanctioned a Truck Loan. What type of charge will be created on the security of Truck: Hypothecation
Charges on Securities
1. Bailment of goods to secure payment of a debt is called – Lien, Pledge, Negative Lien, Hypothecation: Pledge
2. Bank retain possession of goods of the borrower in which of the following – lien, set off, appropriation: Lien
3. Banks are required to maintain secrecy of a customer’s account as per – Indian contract Act; Implied obligation; Implied
right: implied obligation.
4. Documents executed in India are required to be as per Indian stamp act/ State
Stamp Act: Stamped
5. Guarantee claim period when period is not mentioned in the bank guarantee document: 3 years
6. Limitation period for execution of decree: 12 years. (For filing suit for financial decree it is 3 years)
7. Limitation period for filling suit in respect of mortgage is: 12 yrs
8. Power of Attorney is stamped under which act – Indian Contract Act; Banking Regulation Act, State Stamp Act, Indian Stamp
Act: State Stamp Act
9. Relation of banker customer in case of deposit of money for a specific purpose: Bank is Trustee and Customer is
beneficiary.
10. Right of a nominee begins when: on death of all account holders except in case of jointly operated locker accounts.
11. What is a General crossing?: Writing two parallel lines on the face of the cheque with or without and company or any
abbreviation thereof.
12. What is a Promissory note?: Unconditional undertaking
13. What is conversion?: Dealing with others property without their consent.
14. What is lien? Right of creditor to retain possession of goods and securities of debtor till creditor’s dues are paid.
15. What is mortgage: Transfer of interest in specific immovable property to create security for a debt
16. What is noting: Recording the fact of dishonor of a bill or promissory note with Notary public
17. What is Pari-Passu Charge when loan has been sanctioned by more than one bank in consortium?: In case of default, the
sale proceeds of security will be shared in the ratio of outstanding within sanctioned limits.
18. What is the Limitation period of a demand Promissory Note?: 3 Year from date of DPN
19. What is the relation between bank and customer in case of receipt of Garnishee order?: Debtor and creditor
20. When liability of partners is limited it is called?: Limited Liability Partnership (LLP)
21. When on a promissory note or Bill of Exchange period is not mentioned it is called as: Demand Bill or Demand Promissory
Note
22. When on default by Principal Debtor, guarantor pays dues of borrower, he is entitled to all rights and remedies which the
creditor had against the borrower. This right of guarantor is called: Right of Subrogation
23. When the maker or holder of a negotiable instrument signs the same, otherwise than as such maker, for the purpose of
negotiation, on the back or face thereof or on a slip of paper annexed thereto, or so signs for the same purpose a stamped paper
intended to be completed as a negotiable instrument, it is called: Endorsement.
24. Which of the following cannot be endorsed – Cheque/DD/Bill of Exchange/Promissory Note/Fixed Deposit Receipt: FDR
PRIORITY SECTOR ADVANCES
MSME
1. A Small Manufacturing Enterprise unit is considered as Sick Industrial Unit: when account remains sub standard for more
than six months or there is erosion in the net worth due to accumulated cash losses to the extent of 50% or more of its net worth
during the previous accounting year and the unit has been in commercial production for at least two years
2. A small scale unit (manufacturing) can be treated as micro unit if the original investment in plant and machinery does not
exceed : Rs.25 lac
3. A unit in service enterprise is considered as medium if the investment in equipment is: more than Rs 2 crore but up to Rs 5
crore.
4. A Unit will be called as Small Service Enterprise if investment in equipments is up to: Rs 2 crore.
5. Amount of maximum loan given to micro and small enterprises that is covered under-CGFTMSE-scheme : Rs.100 lac
6. As per Micro, small and medium enterprise development Act 2006, a small manufacturing enterprise is one in which original
investment in plant and machinery is: more than Rs 25 lakh and up to Rs 5 crore.
7. As per RBI guidelines, banks are required to provide__% of advance to small enterprises to units in which original
investment in plant & machinery does not exceed Rs 10 lac in the case of manufacturing units and does not exceed Rs 4 lac in
equipment in the case of service enterprises: 40%
8. As per RBI guidelines, Loans to Agro and food processing Units are eligible to be classified under Agriculture Ancillary
Activity under Agril. Finance Priority Per borrower Rs. 100.00 crores.
9. Bank limit for working capital based on turn over method: 20% of the projected sales turnover
10. Banks are required to make 40% of advance to Micro and Small enterprises to manufacturing units with investment up to Rs
10 lakhs and/or service enterprises with investment in equipment up to: No criteria (earlier Rs 4 lakh) and now Micro has to reach
7.00% by March 2016 & 7.5% by March 2017 of ANBC/ceobe which ever is higher.
11. Banks will not obtain collateral security in respect of loans to micro and small enterprises which are covered by Credit
Guarantee Scheme for Micro and Small enterprises?: Rs 1 crore
12. CGTMSE fee: For North East & women; Loan up to Rs 5 lakh – 0.75% p.a.; Loan more than Rs 5 lakh – 0.85% p.a.
13. Composite loan limit for Small Manufacturing enterprises: Rs.1.00 crore
14. For being defined as Medium enterprise, the original investment in plant & machinery should be: More than Rs 5 crore and
up to Rs 10 crore.
15. For being eligible to be classified as small (service) enterprise, the original investment in equipment should not exceed: Rs 2
crore.
16. Full form of CGTSME: Credit Guarantee Fund Trust for Micro & Small Enterprises.
17. If a small enterprise in manufacturing has a good track record, collateral security can be waived up to: 25.00 lacs
18. If an MSME units holds a margin of Rs.20 lac and its projected sales are Rs.400 lac, its working capital limit will be : Rs.80
lacs
19. In case of advance granted to Micro and small enterprises, banks will not obtain collateral security up to: Rs 10 lakh
20. In case of advance to Micro and Small manufacturing enterprises, working capital limit by a bank as per turnover method is
calculated as: 20% of projected annual turnover.
21. In case of loan guaranteed under CGTMSE, what is the extent of cover for loan upto 50 lac granted to a women?: 80% of
amount in default.
22. In case of loan to micro and small enterprises guaranteed by CGTMSE, no collateral security is required for loans up to: Rs
100 lac.
23. Khadi Village Industry part of MSE; irrespective of investment in P&M.
24. Maximum Guarantee coverage for loans guaranteed by CGTMSE if loan up to Rs 5 lakh: 85% of the amount in default with
a maximum of Rs 425000.
25. Micro, Small and Medium Enterprises is under which Ministry: Ministry of Micro Small & Medium Enterprises.
26. SMERA stands for: Small & Medium Enterprises Rating Agency.
27. The definition of Micro and Small enterprise in the manufacturing Sector is based on investment in : Plant and Machinery.
28. Under CGFT scheme for MSE, for loans up to Rs 50 lac, 80% coverage is not available for: SC/ST
29. What is the maximum amount of loan covered guarantee scheme of CGTMSE for loans made to micro and small enterprise:
Rs.100.00 Lac
30. What is the rate of guarantee fees charged under CGSMSE for loan of more than Rs 5 lac to a women?: 0.85% p.a. of limit
sanctioned.
31. Advantages of Cluster based finance to MSMEs: Risk mitigation.
AGRICULTURE, GOVT. SPONSORED SCHEMES & MISC.
1. __% outstanding under General Credit Card Scheme is to be treated as__ : 100 %, Other Priority Sector Advance
2. 100% of GCC accounts and up to 50000/- overdraft permitted in no frill accounts will be treated as: Other Priority Sector.
3. A crop will be called short duration crop if its crop season is up to : 12 months
4. A foreign bank with less than twenty branches in India which did not meet the targets under priority sector advances has to
deposit the amount of short-fall with : SIDBI
5. A 'house loan has been granted which falls in the risk weight category of 50%. If this loan has been made for Rs 100, how
much capital bank is required to bring for this housing loan? : Rs 4.5 (Banks are required to have capital adequacy ratio of 9%. It
means for risk weighted asset of Rs 100 bank is required to bring capital of Rs 9. Since the risk weight in this case is 50%, the risk
weighted assets for a loan of Rs 100 are Rs 50. Capital requirement is Rs 4.5 i.e. 9% of Rs 50.)
6. A housing loan in metro area will be classified as Priority Sector, provided maximum amount of loan is up to and
maximum cost of house is up to: Rs 28 lac; Rs 35 lac.
7. A loan granted for long duration crop will be classified as NPA if loan is overdue for: one crop season.
8. A loan has been sanctioned under NRLM scheme. Bank normally charges interest rate on such loans at 12.25%. As per
NRLM Subsidy scheme, how much reimbursement will be made to bank? 5.25%
9. Advance given for setting up Cold Storage for storing agricultural produce will be treated as part of priority sector provided
the unit is located: Anywhere in India
10. Advance granted for setting up Warehouse or Cold Storage anywhere in India will be considered as indirect advance to
agriculture provided the amount of advance does not exceed : Now It is under Agriculture Infra structure – Rs. 100.00 crores per
project.
11. Advances up to 50 lacs against pledge / Hypothecation of Agricultural produce for a period not exceeding 1.2 months -
treated as priority sector.
12. Agri clinic maximum loan limit for individual: 20 lac.
13. An advance to a farmer against warehouse receipt of his crop will be treated as direct agricultural advance provided:
amount of advance is up to Rs 50 Iakh and up to 12 months.
14. An agricultural advance will be classified as NPA if: it is overdue for 2 crop seasons in case of short duration crops and for 1
crop season in case of long duration crops.
15. Apiculture means : Bee Keeping
16. As per new PS guidelines Food & Agro processing will form part of: Ancillary activity under agriculture.
17. As per RBI Guidelines, no dues certificate is not required with respect to advance to farmers up to: Rs.50000/
18. As per the moratorium guidelines, the repayment of education loan should start from: 12 months on completion of course
or 6 months after getting job, whichever is earlier.
19. Blue Revolution is related to which of the following - poultry, aquaculture, agriculture: aquaculture
20. Blue revolution refers. Pisciculture – fisheries.
21. CGFTSI: 80% coverage not allowed to SC/ST (only to beneficiaries in North East states, women beneficiaries)
22. CGMSE - upto 5 lakhs cover in North East : 0.75% p.a. of limit sanctioned.
23. CGTMSE has been set up by: Govt of India and SIDBI
24. Cluster based approach is applicable for: a) Priority credit advance b) SME c) SHG.
25. Debt Swap meaning: To extend finance to farmers for repayment of loan taken from non-institution lenders
26. Discontinuation of Service Area Approach is as per recommendations of : Vyas committee report
27. Domestic Commercial Banks are required to finance at least 40% of ANBC to the priority sector. Of the priority sector
advances, how much should be given to weaker section: 10% of ANBC.
28. DRI - Family Income in Semi urban - Ceiling Rs. 24000/- & rural 18000/
29. Education loan for vocational purpose in India: Max 1.50 lac
30. Education Loan to an individual for studies abroad will be considered as part of priority sector provided the amount of loan
disbursed does not exceed: There is no limit on amount disbursed but only maximum Rs 10 lac out of the outstanding will be
treated as PS.
31. Exemption of Collateral Security in Agri-Business Clinics Centre: Up to Rs.5.00 lacs
32. FEATURES OF NATIONAL AGRICULTURAL INSURANCE? : CROP DAMAGE COVERAGE
33. Financial Inclusion aims at : The delivery of banking services at an affordable cost to the vast sections of
disadvantaged and low income group.
34. For a Loan more than Rs.1 crore to NGO-MFI /NBFC-MFI: 10% collateral in the form of Bank Deposits.
35. For Agri business centre, outer project cost limit for individual is: Rs.20 lacs.
36. For being eligible under Central Scheme of Interest subsidy on Educational Loans, the parental income ceiling is: Not more
than Rs. 4.5 lacs per annum.
37. For classification as indirect advance to agriculture, investment in Agro based industries in plant and machinery should not
be more than: None of these as advance to agro food processing industry is classified as Small Enterprise and not indirect advance to
agriculture.
38. For classification as priority sector maximum housing loan in metro area can be: Rs 28 lakh
39. For classification as priority sector maximum housing loan in Rural area can be: Rs 20 lakh
40. For coverage under Priority sector, the amount of advance for Retail Trade should not be more than: Rs.500 lacs
41. For foreign banks with less than 20 branches-in India, for which of the following segments, there is no target under priority
sector advances: Agriculture, Export Credit, Small enterprises
42. For MSE units, no collateral security / third party guarantee is to be taken for loans upto Rs. _____: Rs. 10 lakhs. (For Good
track record unit upto Rs 25 lacs).
43. For Ultra Small Branches a designated officer will visit the village on a prefixed date and time every ______with laptop and
will be connected to Bank’s central server (CBS): Weekly or bank discretion
44. Full form of CGTMSE: Credit Guarantee Fund Trust for Micro & Small Enterprises.
45. Full form of P in NRLP: Project (National Rural Livelihoods Project)
46. Housing loan under priority sector more than 10 lac population: Rs. 28 lacs with unit cost not exceeding Rs. 35 lacs.
47. How many members are there in a Joint Liability Group?: 4 to 10
48. How much amount of overdraft will be sanctioned under Prime Minister Jan Dhan Yojna if there are satisfactory
operations in the account for six months?: Rs 5000
49. How much Education loan is allowed for vocational purpose in India?: For course duration upto 3 months Rs. 20,000/-; for
3 to 6 months – Rs. 50,000; 6 months to 1 year – Rs. 75,000 & Above one year - Rs.1.5 lac.
50. How much maximum loan can be allowed to a farmer against ware house receipt for coverage under priority sector: Up to
Rs 50 lac for a maximum period of 12 month.
51. How much per cent of loans under MUDRA to be sanctioned to Shishu: 60%
52. How much Post Harvest Loan against Pledge or Hypothecation of crop produce can be provided for coverage under direct
agricultural advance and for what period?: Loan upto Rs.50.00 Lac for a period not extending 12 months.
53. If there is a shortfall in achieving priority sector target or weaker section target or agricultural advance target, the shortfall
should be deposited in: RIDF
54. In case of agricultural advance no margin or collateral security should be taken up to : Rs 100000/-
55. In case of agricultural advances no dues certificate is not required from small and marginal farmers as per RBI guidelines for
advances up to: Rs 50,000 and now it is waived for all loans irrespective of amounts.
56. In case of Education loan, no collateral security is to be obtained upto: Rs. 7.50 lacs.
57. In case of Educational loans, interest on loans for how much period, interest subvention is given by Government?: 100% of
interest charged during moratorium period will be given as subvention by Government.
58. In case of loans under SGSY, no collateral security is required for loans up to: Rs 100,000 to individuals and up to Rs 10 lac to
Self Help Group.
59. In case of PMEGP, maximum project cost under Manufacturing Sector is and Service Sector is : Rs 25 lakhs and
Rs 10 lakhs
60. In case of SGSY scheme, the number of members of the Self Help Group should be normally and in difficult areas
: 10 to 20; 5 to 20.
61. In JLG number of group members: 4 to 10
62. In Joint Liability Group (JLG), per member can be granted maximum amount upto _____ under priority sector: Rs. 50,000
per person and in case of Group, maximum upto 5 lacs.
63. IN KCC INSURANCE PREMIUM BORNE BY BANK AND CUST IN RATIO OF: 2:1 ( 10:5)
64. In Model Educational Loan Scheme (IBA) repayment of the loan starts after _______ from the date of completion of course:
24 months.
65. In short term agricultural advances, interest subvention is allowed. What is the rule in this regard? : Interest subvention at
the rate of 2% allowed up to Rs 3 lakh and bank will charge interest at the rate of 7%.
66. Insurance amt in KCC for partial disability: Rs.25000 ( death & permanent disability – Rs. 50,000).
67. Interest Subsidy Scheme for Housing the Urban Poor (ISHUP). The scheme will provide a subsidized loan for 15-20 years for
a maximum amount of _______ for a EWS individual for a house: 1 lakh.
68. Interest subvention for Agriculture: 2% and also additional 3% for prompt payment borrowers).
69. Interest subvention for exporter is upto: 3% subject to the condition that the floor rate is not less than 7%.
70. Interest subvention of 1% will be available on housing loans up to Rs.______ to individuals for construction/purchase of a
new house or extension of an existing house, provided the cost of construction / price of the new house / extension does not exceed
25 lakh: 15 lakh.
71. Internal Rate of Return is arrived at a point where future cash flows on Net Present Value basis should be: Zero.
72. Jandhan tag line? Mera Khata Mera Bhagya Vidatha
73. KCC accidental claim as per PAIS: Rs 50,000/- in case of accidental death and Rs. 25,000/- in case of partial disability.
74. KVIC loan irrespective of location /amount/ investment in plant & machinery is treated as SME - Micro Manufacturing
Sector with in Priority Sector.
75. Loan for setting up warehouse, godown will be part of priority sector, provided these are located: Anywhere
76. Loans for co-operative society under Priority Sector: 5 crore
77. Loans to co-operative society for coverage under agricultural advaces: Upto 5 cr.
78. Loans to farmers up to ______ against pledge / hypothecation of agriculture produce for a period not exceeding 12 months:
Rs 50 lac.
79. Loans to individuals for educational purpose India for how much amt will be under priority sector: Rs.10 lacs for inland
studies & abroad.
80. Long duration crop is one in which crop season is: more than 12 months
81. MAX PEOPLE IN SHG? : 20 ( 10-20 )
82. Maximum amount of education loan for studies in India that is covered under Priority sector where no collateral security
and no margin required at present is: Rs 4.00 lakh
83. Maximum amount of loan that can be sanctioned under SGSY is No ceiling
84. Maximum amount of loan to DRI beneficiary was revised as per Union Budget 2007-08. What is the maximum loan other
than the Housing Loan to SC/ST that can be granted to DRI beneficiary: Rs.20,000/-
85. Maximum Number of persons in JLG? : 10 ( 4-10 )
86. Maximum people in SHG? : 20 ( 10-20 ).
th
87. Minimum qualification for loan under PMEGP if project cost in manufacturing more than 10 lacs: 8 pass. If up to Rs 10 lakh
no min qualification
88. Minimum women Self Help Groups in SGSY? 50% of the total Self Help Groups
89. Mudra Bank full form: Micro Units Development Refinance Agency.
90. Mudra Card will be co branded with: MUDRA Ltd and will be Rupay Card
91. Mulbery Crop Loan without margin can be upto : Rs.1 lac.
92. No collateral up to the loan amt in NRLM- Aajivika: Upto 10 lacs.
93. No margin is required to bought in by the borrower for the education loans to special courses up to _____: Rs. 4 lac
94. Normally SGSY group shall contain members who are below poverty line only. In case of non availability of BPL members to
the fullest extent, the number of persons above poverty line can be and in exceptional cases up to :20% & 30%.
95. NREGP scheme (National Rural Employment Guarantee Programme) has been extended to entire country w.e.f. : 01.4.08
96. Organic farming: Farming without fertilizer / chemicals
97. PEMGP Subsidy to be kept as: 3 Years FDR without Interest

98. PMEGP - Margin / Promoter contribution : 10% Genera! & 50/s for Spi category borrowers
99. Prime Minister’s Task Force on loan to micro and small enterprises was headed by: T K A Nair
100. Rajeev Rin Yojana how much maximum loan without collateral security: EWS- 5 lacs; LIG- 8 lacs.
101. Reservation for women beneficiaries under SGSY is: 40%.
102. SGSY has been replaced by: NRLM
103. SGSY scheme which is applicable only in the rural areas has been implemented with what objective?: The objective of SGSY
is to bring the assisted poor families (Swarozgaris) above the poverty line by ensuring appreciable sustained income over period of
time.
104. Target for weaker section loan are ____% of ANBC:10%
105. Target for Weaker section under priority sector: 10% of ANBC or 25% of total PS advances.
106. The Committee which issued guidelines on P.S. advances in July 2012 was headed by: M.V.Nair
107. The extent of coverage under CGTMSE for Micro units upto Rs 5 lacs: 85% with maximum amount of claim upto Rs 4.25 lacs.
108. The maximum amount of guarantee cover for loans granted to small and micro enterprises other than beneficiaries in the
North Eastern Region and women entrepreneurs and guaranteed by CGFT is: 75% of the amount outstanding up to Rs 50 lakh and
50% thereafter as on the date of account becoming NPA with a maximum of Rs. 50 lacs (coverage upto 100 lac)
109. To be classified as Priority Sector, the limits on advance for repairs to dwelling unit located in Rural is __and for units
located in urban areas is Rs.__ : Rs.2 lakh rural, Rs.5 lakh urban
110. Under CGFT, for loans more than Rs 5 lac but upto Rs 50 lakh, 80 % guarantee cover is available for: Loan to Micro and Small
enterprises in NE States, Women.
111. Under CGTMSE liability upto 5 lac how much cover available to micro Enterprises: 85% ( 4.25 lacs )
112. Under MUDRA lending will be for: Non Farm sector
113. Under NULM, additional interest subvention of 3% will be given to women Self Help Groups up to a loan amount of: Rs 3
lakh
114. Under Rashtriya Krishi Bima Yojana which type of risk is not covered : War & Nuclear risk.
115. Under SGSY Scheme, how the instalment should be fixed?: Repayment instalments should not be more than 50 percent of
the incremental net income expected from.the project.
116. Under SHG all the members of the group must be from BPL, however, a maximum of: 20% in general and 30% in exception
can be from marginally above poverty line subject to the condition that APL members not eligible for subsidy.
117. Under SRMS scheme, loan application for projects up to Rs-25,000 should be disposed off within: fortnight
118. Up to what amt no collateral in National Urban Livelihood Mission: In NRLM no collateral up to Rs 10 lakh.
119. Up to what loan amount banks need to lend under Consortium finance? Rs.5 Cr/Rs.10 Cr/Rs.20 Cr / Rs.50 Cr/ No limit now.
120. What are the benefits of covering advances under CGSMSE: Bank can finance viable projects without insisting for collateral
security.
121. What can be the maximum project cost in case of Agri clinic: Rs 20 lac per individual (Highly successful case – max Rs 25
lac). For group it is max Rs 1 crore.
122. What does JAM represent?: Jandhan, Aadhar, Mobile
123. What is Composite fee payable to under CGFT for loans more than Rs 5 lac in North East and other areas: .85% p.a. of limit
sanctioned for loans in North East or to woman or to micro enterprise and 1% p.a. of limit sanctioned in other cases
124. What is financial inclusion: Providing banking services to poor sections at affordable cost.
125. What is full form of USB: Ultra Small branch
126. What is guarantee corpus in MUDRA bank or funds allocated for MUDRA: Rs.20,000 crore
127. What is Mixed Farming? Use of a single farm for multiple purposes, as the growing of cash crops or for the raising of
livestock.
128. What is the corpus of Guarantee fund under MUDRA?: Rs 3000 crore
129. What is the corpus of MUDRA as per budget of 2015-16: Rs 20000 crore
130. What is the cut-off date for RKBY during Khariff Season in case of Loanee Farmers: November.
131. What is the income criteria for classifying a person as economically weaker section for the purpose of housing loan under
Priority sector?: Annual income not more than Rs 200000 (earlier Rs120000)
132. What is the limit for classifying the loan sanctioned to Drip and Sprinker irrigation dealer, for including under Indirect
finance to Agriculture?: - Now in MSME Service irrespective of Amount.
133. What is the margin under MUDRA loans?: For Shishu — Nil; for others — 25%
134. What is the maximum amount of loan and what is the maximum period of loan that can be granted to farmer against
warehouse Receipt?: Rs.50 lakh for 12 months.
135. What is the maximum amount of loan that can be granted under DRI: Rs 15000
136. What is the maximum amount of loan under "Kishore" category under MUDRA: Rs 5 lac
137. What is the maximum amount of loan under "Shishu" category under MUDRA: Rs 50000
138. What is the maximum amount of loan under "Tarun" category under MUDRA: Rs 10 lac
139. What is the maximum amount of MUDRA card?: Rs 20000
140. What is the maximum amount of subsidy for Self Help Group in SGSY scheme?: Rs 125,000.
141. What is the maximum housing loan for a dwelling unit so that it is covered under priority sector: Rs 28 lakh in places with
population of 10 lakh and above and Rs 20 lakh for places with population below 10 lac (earlier Rs 25 lac and Rs 15 lakh)
142. What is the maximum Loan amount permitted under KCC?: No upper limit. It is at the discretion of the bank
143. What is the maximum loan that can be allowed to a dealer in cattle feed / poultry feed, for treating the same as indirect
agricultural advance within priority sector : Rs.500 lac
144. What is the maximum loan that can be allowed to a dealer in cattle feed / poultry feed, within priority sector : Rs.500 lac
145. What is the maximum percentage of finance to Agriculture under Priority Sector? 18% of ANBC or CEOBE which ever is
higher.
146. What is the meaning of Rural Debt Swap?: To extend finance to farmers for repayment of loan taken from non institution
lenders.
147. What is the minimum education qualification required for an entrepreneur for a manufacturing project of Rs.10 Lakhs to be
considered under PMEGP? No educational qualification required
148. What is the normal strength of SHG under NRLM: 10-15 persons
149. WHAT IS THE NORMAL STRENGTH OF SHG UNDER NRLM: 10-15 PERSONS
150. What is the priority sector target for small banks?: 75% of ANBC
151. What is the rate of guarantee fee on loans up to Rs 5 lakh made in North East or to a women in case of Credit Guarantee
Scheme for Micro and Small enterprises?: 0.75% per annum of the limit sanctioned.
152. What is the security under MUDRA?: No collateral security; No third party guarantee; No CGFT cover. Separate Guarantee
cover under MUDRA
153. What is the target for export credit within the priority sector target of 40% for domestic scheduled commercial banks in
India?: Nil.
154. What is the target for foreign banks with less than 20 branches in India for financing Priority sector: 32% by 2015-16 of the
adjusted net bank credit or credit equivalent of Off balance sheet exposure whichever is higher.
155. What is the target for SC/ST under DRI: 40%
156. What is the target in DRI scheme for women: No Target for women.
157. What is the target of lending to-Priority Sector for Domestic Commercial Banks other than RRB: 40% of Adjusted Not
Banking Credit or Off Balance Sheet Exposure whichever is higher.
158. What is the target of Priority sector for domestic commercial banks?: 40% of ANBC or CEOBE whichever is higher.
159. What is the tenure under MUDRA loans?: Shishu — 36 EMI; Others — 36 to 60 months
160. What is the validity period of KCC: five years
161. What is true about DRI target?: two third of DRI advances should be made through rural and semi urban branches.
162. What should be annual income of a BPL family to be eligible for getting interest subvention under educational loan? Rs 4.50
lac.
163. When a farmer in addition to agriculture is engaged in rearing of livestock, it is called: Mixed farming
164. When an MSE unit is showing signs of sickness, the unit is said to be in the ______: Handholding stage of MSEs.
165. Which among the Muslims, Christians, Budhists &iains is not a minority community for priority sector : No as recently Jain
has been Included under Minority Community in Jan. 2014.
166. Which is not a eatable crop: Jute
167. Which of the following Committees have advised that a full service approach to cater to the diverse needs of the MSE sector
may be achieved through extending banking services to recognized MSE clusters by adopting a 4 –C approach: Ganguly Committee
168. Which of the following is constituted for Rural Development: NABARD
169. Which of the following is not of minority community-Muslim, Sikh, Christian, Jain, None of these as all are minority?: jain
170. Which of the following is not the strength of Self Help Group - super profit orientation, saving, internal lending, mutual help,
none of these: Super profit orientation.
171. Which of the following is priority sector for foreign bank with less than 20 branches in India? :1)Export finance 2)MSE 3)Agri:
all of these
172. Which one does not match in respect of reservation to SC/STs : 40% in the case of SJSRY, as in the case of S3SRY, the target
for SC/ST is in the ratio of composition of population.
173. While extending finance to NBFC-MFIs, the percentage of Qualifying Assets should be: Minimum 85%.
174. Within priority sector target of 40% of Adjusted Net Bank Credit or Credit equivalent of Off Balance Sheet Exposure,
whichever is higher, the sub-target for weaker section is : 25% (of PS advances)
175. Within priority sector, for repair of house, how much loan can be allowed to an NRI in an urban area : 5 lakh
NPA & RECOVERY MANAGEMENT
01. Ã Cash Credit account becomes NPA even if regular, when the credit limits have not been reviewed for more than ____
from due date: 6 months (180 days)
02. Ãgency which purchases NPA from banks is called: Assets Reconstruction Company.
03. A bank can sell its NPA account to another bank only after keeping the same as NPA in the books of selling book for at least:
Anytime
04. A bank who has purchased NPA from other bank can resell the same, after holding the same in its books for months
from the date of purchase: 12 months
05. A company which purchases NPAs from banks and reconstructs or securitises the same is called: Asset Reconstruction
Company (ARC)
06. A loan associated with a short duration crop, becomes sub-standard after remaining special mention account for a period of
: two crop seasons
07. A Sub standard account becomes doubtful after: 12 months from date of becoming NPA.
08. Account need not be classified as NPA as long as adequate margin available: Loan against FDR, Life Insurance Policy,Govt
securities.
09. An NPA has been purchased by a bank from another bank. What will be the risk weight for the purchasing bank for this
account? 100%
10. Bank can sell NPA after it has remained in its books for: No lock in period now.
11. Bank/Fls should submit the list of suit-filed accounts of wilful defaulters of Rs. as at end-March, June, September and
December every year to Credit Information Bureau (India) Ltd. (CIBIL) and submit the quarterly list of wilful defaulters where suits
have not been filed only to RBI: 25 lakh and above
12. CC account credit not enough to meet interest: Out of order.
13. CC/OD A/c out of order for a period of _____ to become NPA: 90 days.
14. Classification of NPA in consortium advances: Each bank will classify the account according to its own record of recovery.
15. Credit in 9 months in a cc account are not sufficient to recover the interest but outstanding is within DP. What will be the
position of account: It becomes NPA
16. Debt securitisation means: Conversion of receivables into debt instrument.
17. For purpose of classification of Wilful Defaulters for reporting to RBI, the outstanding should be: Rs.25 lakhs and above
18. Full form of CRILC: Central Repository of Information on Large Credits (CRILC)
19. If in a NPA account, the value of security both primary and collateral deteriorates so much that its realizable value is 10%
and above but less than 50% of the amount outstanding, then this account is directly classified as: Doubtful asset.
20. If Interest debited in an account is not recovered within _____ will be treated as NPA: 90 days from the end of the
quarter.
21. IF THE PRINCIPAL OR INT PAYMENT REMAINS OVERDUE BETWEEN 31-60 DAYS: SMA 1 CATEGORY
22. If value of security is less than 50%, then sub standard account can be straight way taken to Doubtful category.
23. Legal Expenses incurred by Bank in respect of suit filed account to be debited to : P & L account
24. Long duration crop means a crop with harvest season of: More than 12 months.
25. NPA ACCOUNT WILL NOT BE CONSIDERED AS WILFUL DEFAULT: IF DUE TO ECONOMIC RECESSION.
26. Sale of NPA is done on: Without recourse basis
27. Short Duration and long duration crop — who fixes: Agri Deptt of the Govt.
28. State Govt loan can be treated as NPA if a/c is overdue for : 90 days
29. Supervisory Review according to which Central Bank of the country is to ensure that proper capital has been provided for
risk exposure and maintain proper system for the same is provided under?: Pillar II of Basel IL
30. The Exposure norms for a single borrower in normal case and when .financing to Infrastructure are: 15% and 20%
respectively of the capital funds of the bank.
31. The net worth of Asset Reconstruction Company should be: 15% of the assets acquired or Rs 100 crore whichever is less.
32. There is no minimum CRR or SLR as per RBI Act and B R Act.
33. Under OTS, the compromise amount is calculated after taking in _______: Opportunity Cost.
34. What does R stands in ARC: RECONSTRUCTION
35. What is Accrual concept: Mercantile. It means when the amt becomes due you recognize and take it to P & L account
irrespective of the fact that the amount has not been recovered.
36. What is full form of NPA?: Non Performing Asset
37. What is the cut off point for reporting of Willful Defaulter to Credit Information Company?: Rs.25 lakh and above.
38. What is the definition of Quick Mortality: Account becoming NPA with in 12 months from date of first disbursement.
39. What is the purpose of adopting IRAC (Income Recognition and Asset Classification) norms in India?: to move towards
greater consistency and transparency in the published accounts.
40. When a person does not repay bank’s loan though he has profit to pay, he is called: Wilful Defaulter
41. When account will be out of order, in case of non-receipt of Stock Statement: If statement not received for last 3 months.
42. When advance is given to a customer by discounting bills, when the account will become NPA?: When bill is overdue for
more than 90 days.
43. Which of the following can purchase NPA? a) ARC b) Banks c) Financial Institutions d) NBFC e) All of the above.
44. Which of the following entities has released report titled as Framework for Revitalising Distressed Assets in Economy –
Guidelines on Joint Lenders and corrective Action Plan - (i) RBI (ii) Govt of India (iii) Bank Board (iv) IBA: RBI
45. Which of the following was formed first of all : (a) DRT (b) Lok Adalat (c)SARFAESI (d) CDR
46. Which one of the following is not a method as per any law for recovery of bank loan – (a) Filing a case with DRT (b) Action
under Sarfaesi Act (c) Compromise (d) Lok Adalat: Compromise.
PROVISIONING
01. An asset is doubtful for more than 2 years. How much provision is required to be made on the unsecured portion of the
same: 100 %
02. Banks are required to make provision on standard assets at the rate of 0.25% on__ & __accounts : Direct agriculture and
Micro & Small enterprises.
03. General provision on standard assets except specified categories is: 0.40% of the balance outstanding on global basis.
04. How Interest suspense account is to be treated?: Reduce the balance for calculation of provisioning purpose
05. Provision in Standard category under Direct Agriculture & SME: 0.25% of outstanding.
06. Provision in sub standard account, which are abi-initio unsecured: 25% for other than infrastructure
07. Provision on secured Sub-Standard Loan: 15% of outstanding.
08. Provisions in case of accounts classified in Doubtful category for 12 months to 3 years is _____: Deficit + 40% of RVS
09. Prudential accounting norms include : asset classification, income recognition, provision norms.
10. What is the rate of provision in case of doubtful assets which is in D2 category i.e. which is doubtful for two years?:
Unsecured portion 100%; secured portion: 40%
11. What is the rate of provision on secured Sub Standard Loan:15% of outstanding
12. Where provision required (Standard, Sub Standard, Doubtful, Loss): In all cases
DRT / Lok Adalat
01. Limit for filing suit in DRT: Rs.10 lacs and above
02. For referring cases to Lok Adalat, the cut-off limit is: Upto 20 lacs. More than 20 lacs Lok Adalat set up under DRT.
3. MODULE-C: BANKING & TECHNOLOGY

NEFT : Half-hourly settlement
NEFT system presently settles funds transfer requests of the participating banks on net basis at hourly intervals from 8:00 am to
7:00 pm on all working days. All participating banks are required to give the credit to the beneficiary customer only after the inter-
bank settlement has been completed and the End-of-Batch (EOB) message is received by them.
Additional settlements in the NEFT system at half-hour intervals have been introduced by RBI, to enhance the efficiency of the
system and ad(' to customer convenience. The half hourly settlements would speed up the funds transfer process and provide
faster credit to the destination accounts.
Accordingly, with effect from July 17, 2017, RBI decided (013.05.17) under Payment and Settlement Systems Act 2007, to introduce 11
additional settlement batches during the day (at 8.30 am, 9.30 am, 10.30 am ... 5.30 pm and 6.30 pm), taking the total number of half
hourly settlement batches during the day to 23.
The starting batch at 8.00 am and closing batch at 7.00 pm shall remain the same as hitherto. The return discipline shall also remain
the same i.e., B+2 hours (Settlement batch time plus two hours) as per extant practice.
The participating banks have been advised to carry out the required changes in their CBS system to initiate the NEFT transactions
for half hourly settlement as above, and also to accept and credit the inward NEFT transactions on half hourly basis. IDRBT/IFTAS
will communicate the technical changes required to be carried out by participating banks and provide required support in
implementing the same. Banks shall accordingly ensure their readiness in terms of technical and operational aspects.
Further, on 05.02.10, for efficient customer service, the participant banks in NEFT system were advised to send a positive
confirmation to the remittance originator (customer) confirming the successful credit of funds to the beneficiary's account. The
beneficiary / destination banks should ensure strict adherence in sending the N10 messages to the originating banks, which in turn
shall ensure sending the positive confirmation to the remitting customer advising status of credit to the beneficiary account.
BASED ON RECALLED QUESTIONS - 1
1. What was First step towards computerisation in Banking: Setting . up ALPM (Advance Ledger Posting Machine)
2. What is Cheque Truncation?: converting physical cheque into electronic form through scanning.
3. What is the benefit of RTGS: Safe , speedy & client can use thefunds same day.
4. Which equipment is required to capture the signature and photograph and create the same in the program : Scanner
5. What are the charges for NEFT of Rs.3 lakhs - Rs.25 plus service tax
6. What are the charges for balance enquiry through other bank's ATMs: NIL up to 5 transactions at other than 6 metro
stations
7. ATM cash not dispensed - customer complaint to be redressed with in 7 working days
8. RTGS - timings for customers - Monday to Friday 9.00 to 4.30 Saturday 9 .00 to 14.00
9. Real Time Gross Settlement System (RTGS) takes care of which types of risks?: Systemic & Settlement risk.
10. Starting of a computer is called: Booting
11. What is firewall?: A software programme for protecting against unauthorized access to the information.
12. Full form of INFINET? Indian Financial Network
13. Expand LAN: Local Area Network
14. White plastic is called : Counterfeit card
15. What are the Service charges for using ATMs of other banks for balance enquiries: Nil upto 5 transactions ( 3 at Metros)
16. What are the charges that can be charged by banks for Inward RTGS / NEFT I ECS transactions: NIL These transactions are
provided free of cost.
17. What are the Charges for RTGS of Rs 2 lac to Rs 5 lac : Not exceeding Rs.25 plus service tax
18. Converting a physical cheque to electronic form and sending only image of the cheque to the paying bank is called: Cheque
Truncation
19. For repayment under global credit card of an NRI, which account can be debited : NRE
20. PI in RTGS is: Gateway of participating bank
21. Main server of Swift in-India is located at : Mumbai
22. Under RTGS, what is Pis : Member Interface provided to member banks by RBI
23. Truncated Cheque means: a cheque, the image of which is prepared by collecting bank to collect the money from paying
bank.
24. In CBS, signatures are loaded through scanning.
25. Minimum amountof remittanceunderRTGSis :Rs.2lakh
26. A company wants to electronically pay the dividend to large no. of its shareholders, which include small amounts also :
Electronic Clearing Services - Credit (ECS-Credit)
27. Real Time Gross settlement system takes care of which risk : Systemic risk and settlement risk
Electronic Clearing Services - Credit (ECS-Credit) Who has assigned the work for CBS of co-op. banks in india- a)TCS b)RBI
c)NABARD d)SIDBI: TCS
29. Investors Protection Fund is maintained by –NSE/ BSE
30. “F&O” scam- Futures & Options
31. Recently SEBI permitted to FII for Short selling –What is short selling- Selling of share without holding the same.
32. Forward Market Commission is established for:.- Commodity futures
33. Converting illiquid financial assets into marketable securities: securitization
34. RTGS: Real Time Gross Settlement
35. In Credit Card, what type of Benefits available for the card holder?: Purchase Now & Pay Later.
36. In which Max Risk weight applies - 1. Smart Card 2.Debit Card 3. Credit Card 4. ATM Card 5. POS: Credit Card.
37. CBS helps in banking: Any where banking.
38. If a employee wants to convey the message to other employee through computer, what is the media of delivery of
message: E-Mail
39. In a network where all nodes connected to one wire/cable: Star Topology.
40. In Finacle if first time login in system what is mandatory by the user: USER ID & Password.
41. In an Organisation communication between the same organization, what type of system applicable: Intranet.
42. Number of digits in IFSC Code: 11
itself
46. Which was the first step towards mechanization in banks?: Installation of Advanced Ledger Posting Machines.
47. First committee on computerization in banks was headed by: Dr C Rangarajan.
48. What is the minimum amount that can be remitted through NEFT: No Minimum and no Maximum is prescribed.
49. What are the timings for remitting money through RTGS from Monday to Saturday, in case of customer transactions?:
nd th
8.00 AM to 4.30 PM ( Except 2 & 04 Saturday )
50. Which of the following functions is undertaken by RBI inter se among banks – (a) arbitration (b) ombudsman (c)
payment and settlement: payment and settlement
51. Who is not eligible for internet banking? a) Joint account operation severally b) Minor account operated by Guardian c)
Illiterate: Illiterate
52. What is the maximum amount that can be remitted through NEFT?: No limit.
53. What is the minimum amount that can be remitted through RTGS?: Rs 2 lac
54. Only saving customers are allowed to withdraw from other bank’s ATM without paying any charge and that also for Rs
10,000 at a time and up to 5 withdrawals in a month.
55. In Local area network, different computers which are connected are called: Work Stations or Nodes.
56. GBM: Govt. Business Module
57. ECS: Electronic clearing service
58. A computer software that provides services to software applications beyond those available from the operating system
is called: Middleware. It is not part of an operarting system, not a database management system nor part of software application.
59. WAN: Wide area network which is used for interconnecting computers at different Geographical locations.
60. When in a computer network one network protocol (the delivery protocol) encapsulates a different payload protocol, it
is called: Tunnel.
61. A concept that takes the network as a platform for information sharing, interoperability, user centred design and
collaboration on the world wide web is called: Web 02. A Web 2.0 site allows users to interact and collaborate with each other in
a social media dialogue as creators of user generated content.
62. A software application used to locate, retrieve and also display content on the World Side Web including web pages,
images, video and other files is called: Browser.
63. A multitasking, multi-user computer operating system initially developed in assembly language is called: UNIX
64. In the case of network topologies, when a network consists of one central switch, hub, or computer, which acts as a
conduit to transmit messages, it is called: star network.
65. ATM : Anywhere, anytime,
66. BCP- Business continuity Plan
67. NEFT- National Electronic Fund Transfer
68. A device that forwards data packets between computer networks creating an overlay internetwork is called: Router
69. Technology that allows an electronic device to exchange data wirelessly over a computer network is called: Wi fi.
70. Charges for remittance through NEFT is : Upto Rs 10,000: Rs 2.5; Upto Rs 1 lac- Rs 5; More than Rs 1 lakh up to Rs 2 lakh
– Rs 15; More than Rs 2 lakh – Rs 25.
71. Charges for Speed Clearing: Nil for collecting outstation cheques in local clearing for amount up to Rs 1 lac in case of SB
customers. For cheques of more than Rs 1 lac banks have discretion to fix charges. For current account customers, the banks
have discretion for charges irrespective of amount of cheque.
72. Direct linking of operations to a computer providing for simultaneous updating of the system is called On-line updating.
73. NICNET allows a gateway to VSNL at:- Mumbai
74. Countrywide data communication network INFINET was set up by RBI as per________committee recommendations:- Saraf
Committee
75) Which system is mainly used in branch level Computers?:- UNIX
76) The interconnectivity of Computers to a common server within a small area is known as:- LAN
77) When fed data is written and stored in two hard discs simultaneously over the different channels, the system is known as:-
Disc duplex
78) First Committee on Mechanisation and Computerisation in Banking was headed by:- Dr C Rangarajan
79) The INTERNET uses the protocol termed as:- TCP/IP
80) The pattern in which the devices are interconnected in a computer network is called:-Topology
81) Satellite Communication is an alternative to wire telecommunication. Here text data and video information is converted
to_______:- Radio waves
82) The method of transfer of data over networks is called:- Packets switching
83) Rules of communication between similar modules of processes in different nodes is called:-Packets switching
84) DDP approach recommended by Rangarajan committee means:- Distributed Data Processing
85) Creation of__________is the most important prerequisite for Core Banking Solutions:- Central data base
86) Rangarajan committee was set up twice in _________ &_____________ :- 1983 & 1988
87) In personal banking, the software provided is Interactive.
88) EFTPOS stands for ______________:- Electronic Funds Transfer at the Point of Sale
89) In Telebanking, the seIler is identified by:- A PIN number
90) At the end of the day, if the computer operator posts all the day’s transaction in to the computer system, the process is called:-
Batch updating
91) Scanner converts the image of a specimen signature in to a:-Digital form
92) NICNET was set up by:-National Informatics Center.
93) SLIP stands for:-Serial Line Protocol
94) WWW stands for:World Wide Web
95) The widely adopted definition of EFT is given in:- Section 105(5) of article 4A of the uniform commercial code, U.S.A 1975
96) Where was SWIFT established? :- Brussels
97) CHIPS stands for:- Clearing House Interbank Payment System
98) Fed Wire was started by: Federal Reserve Bank of USA
99) Floppy input clearing is:- The participating banks submit their interbank claim statements in electronic format on floppies
100) Front end processor is:- It is a dedicated communication system that intercepts and handles communication activities for the host
computer
BASED ON RECALLED QUESTIONS – 2
1) What type of computer system is used for ledgers & posting? :- Stand alone ALPM
2) How data processing is handled in Advanced Ledger Posting Machines? :- In the CPU of the computer being used
3) Where the data processing is handled in Multi-user computer net working system? :-At a centralized computer
4) How the different staff members work on multi user computers system? :-They work on separate terminals connected with
the main computer
5) Which of the followings are in-built security features in computers used in branches? :- Data recovery and back ups
6) Whatarethefeatures of Total Branch Automationsystem:- Onlineand Inter-linked with authenticationby Supervisory staff
7) What additional features can be made available with total branch automation system? :- EFT, Off site ATM, LAN, WAN etc
8)What important functions are handled at Head Office level on computers? :- HRD, Branch monitoring and inter branch reconciliation & Funds and
Investment management
9) What is node? :- Each independent system working in LAN
10) What is topology ? :- The plan in which various devices are interconnected for communication
11) The interconnectivity of computers to a common server within a small area is known as______:- LAN
12) ______is not a centralised controlling topology? :- Bus
13) What is the nature of Ring and Bus topology?.:- Distributed System
14) How can be the systems interconnected in WAN? :- Through telecommunication, satellite and microwave system
15) Different parts of a Channel are :- Power supply, controlling card & Interface cable
16) Memory processing is not a function of a dumb terminal
17) Which are the features of core banking solutions? It provides on-line banking, all transactions are made at a centralized point, and it is
useful for 24 hour-any where banking
18) Prior to 1983, banks had taken a passive view of computerisation. This changed after 1983, because: Many banks signed an agreement
with the unions providing fo computerisation
19) _____Committee report was well received by
the banking community and bank automation took off:- Rangarajan committee
20) _ Simplex system is:- Devices connected to such a circuit are either a send only or a receive only device
21) in SWlFT is a security control to prevent automatic changes in messages :-Checksum
22) Dataminingis a Techniqueto access strategicinformationand aprocessof automaticallyfindingpatternsand relationsinalargedata base
23)ATMs can be of Online type, Offline type, off-site or On-site type.
24) Security is provided in ATM transactions by putting in place, a PIN system embedded in the card, Access locks on keypads,
Monitors & Video surveillance and record systems.
25) The single largest factor that promotes frauds is:- Inadequate control on data access and storage
26) The term _________refers to a group of persons directly / indirectly involved in establishing and running the Computerized
systems:- People ware
27) CPU consists of the ALU unit and:- Control Unit
28) Advantages of ALPMs are:- Low equipment cost, Better security & Easier to train the staff on
29) Most of the banking systems were developed using:- Centralised computing concepts, Using UNIX platform initially
30) Increased use of computerisation at branch level can:- Reduce the waiting time per customer & Increase accuracy
31) Disk mirroring and disk duplexing help in:- Retrieving data in case of a technical snag
32) To Confirm that the computerised systems are working well, Transactions are being conducted within the assigned authority and to follow up
and note unusual and unauthorised transactions if any___ ___are created:- Audit trails and exceptional transaction reports
33) In a totally automated branch, banking can said to be_________. Real time online banking
34) In________ updating independent modules are interconnected so that changes can be done without any time lag:- Real time
online banking
35) To provide Single window service concept to the customers, Branch has to be totally automated and System should be capable of
shifting to Partial window and universal window transactions
Internet banking site for security is certified by:- VeriSign (to verify the signature)
36) Under the LAN (local area network) each independent system is known as:- Node or Work station
37) Sharing common cabling, Pooling of resources and a common medium such as a cable or a Radio or a light wave are the key elements of Local
area network (LAN)
38) In corporate cash management services a_________can act as a secure key:- Smart card
39) In Corporate cash management, Corporates can________between their accounts on secure lines. Directly transfer funds
40) Topology is the way in which the devices are interconnected. Topology can be:- Centralised control type and Distributed control
type
41) The function of ______is primarily to set up some computers as hosts, set up some computers as clients AND connect all the
computers involved with each other:- Networking software
42) The system of______ is used popularly in branches and branches are connected with RO and HO using normally:- LAN, WAN
43) In front office (branch) computerisation, several stand-alone systems are connected via a____normally. This is to enable the
computers to_______each other's database:- LAN, access
44) ___________is not possible in branches where computers are not networked :- Single Window concept
45) Sharing &reducing cost of infrastructure, avoiding duplication of work and sharing of Processing load among all terminals are
some of the advantages of:- Local Area Network
46) In the case of a WAN system, connectivity is through__________. An external communication system
47) In WAN, Computers can be connected using:- Telephone lines, Satellite Links or Microwave links
48) If connectivity is established using microwaves, signals travel from one_________to other which are
located not more than 25 miles away from each other:- Dish antenna
49) Computers are controlled by sequence of instructions called:- Computer program
50) Relay stations ______ & _____the signals resulting in connectivity:- Catch & Boost
51) Satellite communication is an alternative to wire telecommunication. Here text data and video information is converted to Radio
waves
52) Which part of the computer is responsible for processing?:- CPU
53) Rules of communication between similar modules of processes in different nodes are called:- Protocol
54) Ethernets use_____________systems. Adapters
55) The token - in a token ring system is____________:- CSMA/CD systems
56) _____combines individual data capacity needs of low speed and groups them to be able to transmit single high speed line:- A
special frame
57) Bits stands for:- Binary digits
58) Both the computers connected through a telephone line requires a_______at each end:- Modem
59) UPS means _________ Uninterruptible power supply.
60) Supercomputers are primarily useful for:- Mathematical intensive scientific applications
61) Computer is an electronic device, which processes_________________. Data
62) Primary memory is used by the ______________ CPU
63) The two main types of UPS are_______________ Online-Offline
64) In banking technology normally__________ UPS is used:- On-line
65) In an On-line UPS, the battery cum Rectifier converts_ ______input current to________ 230V to 48 DC.
66) Core Banking can be described as ___________ Centralised computerization model where there is a Central database &
transactions put through & updated centrally. Can be linked to multiple delivery channels like ATMs.
67) Core banking solutions offers_____________ Integrated banking solutions to the customer and gives scope for uniform software
solutions to all the branches through WAN.
68) Efficient and effective MIS & DSS, ALM, Risk management solutions apart from integrated and better Customer Service are some of
the benefits of ____________ CBS
69) While implementing CBS____________are not mandatory in the networked branches: Servers
70) In implementing CBS cost is___________initially but becomes____________later on when more branches and delivery channels
are added. High, Low
71) Merchant establishments with low-ticket purchases prefer manual mode of acceptance of cards and need to keep Warning
bulletins.
72) Creation of_ ________is the most important prerequisite for Core banking solutions. Central data base
73) CBS requires_ ______manning to offer meaningful service to customers. 24 by 7 (24X7)
74) DRS is Disaster recovery site
75) DRS is normally envisaged in a place where________ considered reliable. Disaster recovery site.
76) While saetting up DRS, factors like______are also considered__________ Possibility of floods, Wars (bombing attacks) and
Earthquakes
77) BPR is Business process reengineering
78) Hardware configurations (terminals) called Dumb Terminals _________-Send and receive information only
79) In a LAN system generally does not extend beyond_______. However a maximum spread of up to_________is sometimes put in
place. 100 meters & 1 km.
80) ________are intelligent auto teller machines that operate even without a reliable communication network
BANKING & TECHNOLOGY

Memory based Recalled Questions 2006-17
Computer & System
collaboration on the world wide web is called: Web 02. A Web 2.0 site allows users to interact and collaborate with each
other in a social media dialogue as creators of user generated content.
4. A software application used to locate, retrieve and also display content on the World wide Web including web pages,
5. AEPS stands for : Aadhar Enabled Payment System
8. CBS helps in ____banking: Any where banking.
9. Converting illiquid financial assets into marketable securities: securitization
13. Full form of ALU: Arithmetical Logical Unit
14. Full form of HTTP: Hyper Text Transfer Protocol
17. IBPP stands for: Internet Bill Presentation & Payment
message: E-Mail
19. IMPS: Immediate Payment Service - Mobile to account.
22. In Flexcube if first time login in system what is mandatory by the user: USER ID & Password.
.
26. What was First step towards computerisation in Banking: Setting up ALPM (Advance Ledger Posting Machine)
27. When in a computer network one network protocol (the delivery protocol) encapsulates a different payload protocol,
it is called: Tunnel.
28. Which equipment is required to capture the signature and photograph and create the same in the programme: Scanner
30. A Proxy server is used for: To provide security against unauthorized users.
31. What is Phising: To steal the customers personal / confidential data like Bank a/c number, Credit Card Number, PIN or
Password over internet & access their accounts.
32. Full form of USSD: Unstructured Supplementary Service Data.
33. Maximum RTGS Charge for Rs.2 lac to 5 lac: Rs. Rs. 30.00 + service tax.
34. What is the minimum amount which can be remitted under RTGS by a customer: Minimum Rs. 2 lac and no Maximum.
35. In case of failed ATM transaction customer’s account should be credited within how many days of the complaint?: 7
working days.
36. AEPS stands for : Aadhar Enabled Payment System.
37. CPPC stands for : Central Pension Processing Cell.
38. IBPP stands for : Internet Bill Presentation & Payment.
39. Rupay Platform refers to: National Payments Corporation of India (NPCI) initiated the launch of RuPay card in India. It was
done with the intention of integration of payment systems in the country. It has led to lower transaction cost as processing
is being done within country. Also, transactions will be faster.
a. Full form of CVV: Customer Verification Value
40. Full form of NUUP: National Unified USSD Platform.
41. Full form of IMEI: International Mobile Equipment Identity.
42. Full form of NPCI: National Payment Corporation of India.
43. Full form of CVD: Customer Verification Data.
44. Universal set of standards and guidelines for communication by EDI is called: EDIFACT.
45. Full form of ISDN: Integrated Services Digital Network.
46. RTGS amount limit for customers: Min Rs.2 lac and no max
47. Which bank has max share in INFINO PAYTECH Ltd : ICICI Bank
48. NEFT maximum amount: no limit
th
49. Computer Security Day is observed on : 30 November
50. Maximum compensation by Banking Ombudsman in case of Credit Card : Rs.1 lac
51. Encryption means: Conversion of plain language into secret language, i.e., coding and The extent of coverage under
CGTMSE for Micro units up to Rs 5 lacs is ______: 85% with maximum amount of claim upto Rs 4.25 lacs.
52. E-sahyog portal: by Income Tax
53. Maximum RTGS Charge for Rs.2 lac to 5 lac: Rs.30.00 + service tax
54. What is the maximum amount of fees chargeable if more than 5 transactions are done in a month at other bank’s ATM: Rs
20 per transaction
55. Application under ASBA can be applied for: a) IPO b) Right Issue c) Mutual fund: Ans: All of these.
56. Name the portal that has been launched by the Confederation of All India Traders (CAIT) to promote business-to-business
and trader-to-customer e-commerce transactions and reduce costs. (E-Lala)
57. Name India’s first Social mobile wallet launched by Transerv, a leading digital payments company. (Udio)
58. Name the programme launched by online market place BankBazaar.com to help the flood affected citizens of Chennai.
(‘One Loan Two Homes’)
59. Buy Now, Pay Later what type of card: Credit Card
Computer & System

collaboration on the world wide web is called: Web 02. A Web 2.0 site allows users to interact and collaborate with each
other in a social media dialogue as creators of user generated content.
4. A software application used to locate, retrieve and also display content on the World wide Web including web pages,
5. AEPS stands for : Aadhar Enabled Payment System
8. CBS helps in ____banking: Any where banking.
12. Full form of ALU: Arithmetical Logical Unit
13. Full form of HTTP: Hyper Text Transfer Protocol
16. IBPP stands for: Internet Bill Presentation & Payment
message: E-Mail
18. IMPS: Immediate Mobile Payment Service - Mobile to account.
.
24. What was First step towards computerisation in Banking: Setting up ALPM (Advance Ledger Posting Machine)
25. When in a computer network one network protocol (the delivery protocol) encapsulates a different payload protocol,
it is called: Tunnel.
26. Which equipment is required to capture the signature and photograph and create the same in the programme: Scanner
Cheque Truncation
1. Converting a physical cheque to electronic form and sending only image of the cheque to the paying bank is called: Cheque
Truncation
2. CTPS stands for: Cheque Truncation payment system
3. Truncated Cheque means: a cheque, the image of which is prepared by collecting bank to collect the money from paying
bank.
RTGS/NEFT
4. What is the benefit of RTGS: Safe , speedy & client can use thefunds same day.
5. Real Time Gross Settlement System (RTGS) takes care of which types of risks?: Systemic & Settlement risk.
6. What are the charges that can be charged by banks for Inward RTGS / NEFT I ECS transactions: NIL These transactions are
provided free of cost.
7. What are the Charges for RTGS of Rs 2 lac to Rs 5 lac : Not exceeding Rs.25 plus service tax with time varying tariff.
8. PI in RTGS is: Gateway of participating bank
9. What is the minimum amount that can be remitted through NEFT: No Minimum and no Maximum is prescribed.
10. What is the minimum amount that can be remitted through RTGS?: Rs 2 lac
11. NEFT- National Electronic Fund Transfer
12. Charges for remittance through NEFT is : Upto Rs 10,000: Rs 2.5; Upto Rs 1 lac- Rs 5; More than Rs 1 lakh up to Rs 2 lakh
– Rs 15; More than Rs 2 lakh – Rs 25.
nd th
13. Neft settlement: 12 Hrly settlement on weekdays & Except 2 & 4 Saturdays
14. Penal rate if RTGS credit not given in 2 hours: Repo Rate + 2%
15. Limit for sending remittances to Nepal by NEFT: Rs.50,000/ per transaction.
16. Amount below 2 lac can be remitted from one bank to other bank within India by – RTGS, NEFT, SWIFT, Money Transfer
scheme: NEFT
17. Full form of IFSC: Indian Financial System Code
18. Full form of NEFT: National Electronic Fund Transfer
19. In case of delay in credit on account of RTGS/NEFT/NECS/ECS, compensation to be paid at the rate of: Repo Rate+2%
20. LIMIT FOR SENDING REMITTANCES TO NEPAL BY NEFT: Rs. 50000/-
21. No of digits in IFSC code: 11
22. RBI has advanced business hours in respect of RTGS from 9.00 hours to _____ and extend closing time of RTGS to 20.00 hours
on week days: 19.45 hours
nd th
23. Under NEFT, how many times in a day on week day i.e. Monday to Saturday ( Except 2 & 4 ), transactions are settled?: 12
times in a day at every hour (First settlement at 8 AM and last at 7 PM)
nd th
24. What are RTGS timings for customer transactions and inter bank transactions on Monday to Saturday ( Except 2 & 4 )?:
For customers – 8 AM to 4.30 PM and for inter bank transactions – 8 AM to 8 PM
25. What is full form of RTGS?: Real Time Gross Settlement System.
26. What is the Code required for transfer of funds from one bank account to another bank account in India through NEFT/RTGS
– (a) IFS code; (b) MICR code; (c) Pan code: IFS Code;
27. What is the full form of M in MTSS: Money ( Money Transfer Service Scheme)
28. What is the meaning of S IN RTGS: Settlement
29. What is the minimum and maximum amount that can be remitted under RTGS?: Rs 2 lac and no limit
30. Which of the following is a feature of RTGS? Transactions processed and settled individually on real time basis.
ATM
1. ATM cash not dispensed - customer complaint to be redressed with in 7 working days
2. For setting up of White Label ATMs, the corporate body’s net worth must be _____Rs.100 cr.
3. Full form of PIN which is used in ATM? Personal Identification Number
4. If a customer uses other bank’s ATM for any transaction in excess of permitted free transactions, what is the maximum
charge that can be levied by the bank per transaction?:Rs.20/- per transaction.
5. In case of failed ATM transactions, banks must reimburse to the customers, the amount wrongfully debited on account
of failed ATM transactions within a maximum period of ____ days from 01-07-2011. Otherwise, Bank has to pay
compensation of Rs. per day for the period of delay: 7 working days;100/-per day
6. In Credit Card, what type of Benefits available for the card holder?: Purchase Now & Pay Later.
7. In which cities on non bank atm 3 free transactions rule will not be applicable: pune and jaipur ( it is applicable in Delhi,
Kolkatta, Chennai, Mumabi, Bangaluru, Hyderabad)
8. In which Max Risk weight applies - 1. Smart Card 2.Debit Card 3. Credit Card 4. ATM Card 5. POS: Credit Card.
9. Tata and Muthoot have been given license for which activity recently?: For installing White Label ATMs
10. What are the Service charges for using ATMs of other banks for balance enquiries: Nil upto 5 transactions ( 3 at Metros)
11. What is National Financial Switch (NFS)?: Largest network of shared automated teller machines (ATMs) in India run by the
National Payments Corporation of India (NPCI).
12. What is Rupay: Indian domestic card scheme conceived and launched by the National Payments Corporation of India (NPCI)
13. What is the minimum age for allowing ATM, internet banking facility to a customer?: Generally 10yrs (some banks have fixed
higher age limits)
14. What is White Label ATM?: ATM installed and operated by other than banks
15. White Label ATMs are installed and operated by: Non-bank entities called White Label ATM Operators (WLAO) They will
provide the banking services to the customers of banks in India, based on the cards (debit/credit/prepaid) issued by banks.
16. White plastic is called : Counterfeit card
GENERAL
3. A computer software that provides services to software applications beyond those available from the operating system
is called: Middleware. It is not part of an operarting system, not a database management system nor part of software
application.
itself
5. Application under ASBA can be applied for: a) IPO b) Right Issue c) Mutual fund: Ans: All of these.
6. Charges for Speed Clearing: Nil -for collecting outstation cheques in local clearing for amount up to Rs 1 lac in case of SB
customers. For cheques of more than Rs 1 lac or any amount now -NIL irrespective of amount of cheque.
8. Converting physical shares to electronic form is called: Dematerialisation.
9. Credit card and Debit Card is called: Plastic money
10. ECS: Electronic clearing service
11. For opening Demat account with Depository Participant, what type of ID proof is mandatory?: PAN Card
12. For repayment under global credit card of an NRI, which account can be debited : NRE
13. Full form of USSD: Unstructured Supplementary Service Data
14. In a network where all nodes connected to one wire/cable: Star Topology.
15. In Local area network, different computers which are connected are called: Work Stations or Nodes.
16. In the case of network topologies, when a network consists of one central switch, hub, or computer, which acts as a
conduit to transmit messages, it is called: star network.
17. Main server of Swift in India is located at : Mumbai
18. MAX CASH WITHDRAWAL THRU POS, MERCHANT ESTABLISHMENT? : Rs. 1000 PERDAY PER CARD IN TIER I & TIER II
CENTRES AND RS 2000 PER DAY AT OTHER CENTRES
19. National Financial Switch of IDRBT (now with National Payment Corp of India): ATM network.
20. Number of digits in IFSC Code: 11
21. PROCESS OF COVERTING PHYSICAL SHARES INTO ELECTRONIC FORM – DEMATERIALIZATION
22. Rupay card is issued by which company: National Payment Corporation of India
23. SMS alert should be sent to customer in case of Credit Card/ Debit card/ POS transaction for how much amount?: For any
amount.
24. Technology that allows an electronic device to exchange data wirelessly over a computer network is called: Wi fi.
25. The _____ provides a network that enables financial institutions worldwide to send and receive information about financial
transactions in a secure, standardized and reliable environment: Society for Worldwide Interbank Financial Telecommunication
(SWIFT)
26. Under Cheque Truncation system, to meet legal requirements, the presenting banks which truncate the cheques need to
preserve the physical instruments for a period of: 10 years.
27. Validity period of Gift card recently increased to: 3 years
28. Virus refers to: Program which infects the system.
30. What is full form of MICR?: Magnetic Ink Character Recognition
31. What is full form of NPCI?: National Payment Corporation of India.
32. What is full form of PSTN?: Public Switched Telephone Network
33. What is Phising: To steal the customers personal / confidential data like Bank a/c number, Credit Card Number, PIN or
Password over internet & access their accounts.
34. What is the code of saving cheque no in the last 2 digit of MICR Band: 10
35. What is the purpose of Disaster Recovery Plan: Alternate Server installed for smooth functioning of systems in case of failure
of Main Server.
36. What is the purpose of Disaster Recovery Plan: Alternate Server installed for smooth functioning of systems in case of failure
of Main Server.
37. What is the time period for crediting proceeds of outstation cheques presented in Speed Clearing: 48 hours.
38. Which of the following functions is undertaken by RBI inter se among banks – (a) arbitration (b) ombudsman (c)
payment and settlement: payment and settlement
39. Which of the following is withdrawn by RBI: a) EFT, b) NEFT, c) RTGS, d) ECS, e) ABB: EFT.
40. Which type of delivery channel for delivery of banking services is most cost effective – (a) Mobile Banking; (b) Net Banking; (c)
ATM; (d) Door Step Banking; (e) Branch Banking: Net Banking.
4. MODULE –D : MARKETING
ONE LINE APPROACH : MARKETING ( BASED ON RECALLED QUESTIONS ) -
1) Market May Comprise of: One seller and many buyers, Many sellers and one buyer, Many sellers and Many buyers, Few sellers
and Many buyers, Many sellers and Few buyers
2) A “likely” interested customer of the bank is termed as prospect.
3) In Marketing, calling on the prospective customers is known as a call.
4) Division of the whole market into relatively homogeneous groups is called Market Segmentation.
5) Marketing Guru Philip Kotler defines market segmentation as the subdivision of a market into homogeneous subjects of
customers.
6) Marketing Mix: It is the set of marketing tools that a firm uses to pursue its marketing objectives in the target market.
7) E. Jerome McCarty proposed a classification of marketing mix in four key areas: 1. Product, 2. Price 3. Place & 4. Promotion
8) SWOT Analysis: A tool used by organization to help the firm to establish its strength : S – Strengths W – Weakness, O –
Opportunity, T – Threats,Note: Strengths and Weakness are – Internal Function Opportunity and Threats are - External Function
9) 4 Stages of Product Life Cycle (PLC): i. Introduction ,ii. Growth , iii. Maturity iv. Decline
10) Brand: Brand is defined as “a name, term, sign and symbol or a combination of these, that identifies the maker or seller of
the product
11) If a new branch is opened by a bank, it can be a growth strategy:- Intensive growth
12)The recent development in the packaging industry, which has immense significance, particularly in international trade, is: -
Environmental concern
13) Price Cartel means:- An informal or formal understanding amongst vendors of similar goods to price the goods in a manner .
mutually agreed upon.
14) The customer's demand schedule is one of the three factors influencing the pricing. The other two are: -Cost function and
competitor’s pricing
15) A College announces that if 50 students join and place orders for their Marketing text book, their offer price will reduce from Rs
200/- to Rs 175/-. What pricing method are they using here? -Group pricing
16) The Grand Bazaar sells its famous soft bread at Rs.7/- as against Rs. 8!- elsewhere. The shop is actually making a loss in this
transaction. However, many people go to Grand Bazaar to buy bread. What is the pricing strategy here?- Loss leader pricing
17) Public sector undertakings with large funds are taking the _________ route now days to choose a bank for placing their funds: -
Sealed tender auction
18) The Postal department charges a higher price for "Speed Post" service compared to "Ordinary Postal" services. This can be
st
classified as:- 1 degree discriminatory pricing
19) In 4Ps of market mix, Distribution refers to: -Place
20) Dell computers takes orders from the customers directly through the internet and delivers the product to Customer's doorstep.
This is a combination of:- Zero level distribution & pull strategy
21) Forecasting demand means:- Assessment of the demand for the products
22) A direct marketing channel is also called level channel : - Zero
23) Do Home Banking and Net Banking mean the same thing?- No, home banking is based on dedicated connectivity while net
banking is Internet based.
24) The term Brand Equity refers to: -The value attached to brand name.
25) Bank of Punjab merged with Centurion Bank to form Centurion bank of Punjab.The growth strategy adopted here can be termed
as : -Integrative growth
26) Public relations means building good relations with:- Consumers, Suppliers and Shareholders
27) If the promotion efforts are directed to the final consumer to induce him to buy the product, the strategy is term as:- Pull
Strategy
28) Many credit card companies are sending compliment cards, (with no initial fee) to identified High Net worth Individuals (HNIs).
This can be called as: -Push Strategy.
29) The major risk in outsourcing in Banking business is :- Reputation Risk
30) Who issues guidelines for Outsourcing in Banks :- Reserve Bank of India.
31) The thorough and objective gathering and analysis of data that pertains to a given problem in marketing is known as :-Marketing
Research
32) Customer data base formation involves collecting of:- Geographical, Demographic and behavioral data about customers
33) Sources of Information which are the origins of the Information are called ____ sources: Primary If a new branch is opened by a
bank, it can be a _ growth strategy: Intensive growth strategy
34) Hindustan Lever launched Surf Excel and Surf Excelmatic. This is a __________ type of branding strategy
Line Extension
35) A typical banking product mix has several – such as loans, deposits, other services etc. Product Lines
36) Non-users and customers willing to try out new Products" make ideal targets for a product in its – stage
Introductory Stage
37) Undefined concept, absence of uniform shape, Unpredictable turning points, and unclear implications" these are some of the
weaknesses of :-Product Life Cycle
38) Three layers of packaging are:- Primary, secondary & shipping packaging
39) The Objectives of Price can be any one or more of following:- Profit, Market share, Cash flow, financial inclusion, etc
40) Banks saddled with very high Non performing assets may find it difficult to extend fresh loans. They may then try to improve
their other business such as non fund based business (LC, BG) and sevices (cheque collections) by offering lower service charges. This
method of pricing has the objective of:- Survival
41) Some foreign banks stipulate very high minimum balances. Their pricing objective is:- Wanting to communicate an exclusivity
perception
42) An Informal or formal understanding amongst vendors of similar goods to price the goods in a manner
mutually agreed upon is called a:- Price Cartel
43) Normally cost forms the_____of the price: -a) Floor
44) A bank offer a Credit card holder a personal loan at 13% to enable him to pay off his credit card out standings. This customer is
paying 24% on his credit card out standings and therefore is very happy to accept the Offer. The bank charges 10% on personal loans
normally. The pricing method employed here is:- Value pricing
45) Wholesale sellers can not be____________for banking products :- Intermediaries
46) There are five main factors influencing channel section. They are product characteristics, market characteristics, customer
characteristic and __________ :- Company resources, competitor
47) )A customer finds during the tenure of Mr Lal as the cashier, he received better and quicker service than the tenure of Mr. Ram.
This is one of the basic features of services industry and is defined as: Heterogeneity
48) For products with wide spread market it is better to have__________:- Two/Three levels in the channel
49) If production and consumption of services take place simultaneously, the process is called: Servuction
50) Financial Services have the additional character in addition to the Characters of a normal service. Fiduciary Responsibility
51) When colour television was first introduced in Delhi, each set was priced at Rs 16000/-.After two months of sales, the prices
were seen at Rs 15000/. Two months later, the price went down further to Rs.14000/-. In this hypothetical example, what was the
pricing strategy of the TV Company?:- Market skimming strategy.
52) ABC Bank offers 1.25 % higher interest on Senior citizen deposits. It also has a loan product for working women, where the
interest rate is 1% lower than other loans. What is the pricing strategy known as? III degree discriminatory pricing
53) ABCL Infocomrn was launched later than BTL Mobile and a few other mobile services in Kerala. Their pricing was however
lower than others. This attracted a large number of subscribers in a short span of time. Later they raised the prices to match the
competitor's prices. What is their pricing strategy called? Market penetration strategy
54) Product line pricing is one of the types of______pricing:- Discriminatory pricing
55) A product has been priced high but discount is allowed to the customer on buying it. What type of concession is this?:-
Psychological discount
56) In the Absorption pricing strategy the price is arrived by adding________to the total cost (fixed +variable) of the unit. :-
Required rate of return on the investment
57) In the English auction system, there is one seller and many buyers. Many times the seller :- Sets floor or minimum price
58) The "Economist" world famous magazine is available for £ 5 in U.K. and £ 7.50 in India. This is because of the high cost of
transportation. The pricing strategy here is:- Geographical pricing
59) Loss leader pricing, special event pricing, cash discounts are examples of:- Promotional pricing
60) Telephone bills are normally spilt in to a monthly basic minimum and varying call expenses. This pricing strategy is termed:-
Two-part pricing
61) Mark up pricing is a pricing_____while as Geographic pricing is a pricing_____:- method, strategy
62) First degree discriminatory pricing strategy recognizes the following as main considerations:- Cost function
63) The three C model for pricing has the following inputs:- Customer demand, Cost function, Competitors price
64) Concentrated Marketing is a strategy opted for:- Market Segmentation
65) Direct mail and Sales Call are channels of:- Direct Marketing
66) Product Characteristics, Market characteristics and customer characteristics determine______ :-Distribution channels
67) Fruits, vegetables and flowers are normally distributed in near by markets only. This is because of the
_________characteristic of these products :- Perish ability
68) Automated teller machines on sharing basis with other banks help the banks to enlarge their distribution network just as if they
have added a new branch:- True to some extent as ATMs are used to deliver only few products and in a limited manner
69) Plastc cards, internet banking, telephone banking are distribution methods of banking products which serve the
distribution purpose and also help the banks to overcome the implications of:- Inseparability & heterogeneity
70) Channel partners undertake functions other than product distribution. This statement is true because: -They gather intelligence and
information about customers, competitors and help forecasting demand
71) Forecasting demand means: Estimating future demand for the product
72) Storage, protective packaging, transportation are the tasks associated with__________ :- Inventory Management
73) The functions of distribution channels do not include:- Market Research
74) Home banking is an example of :- Direct Marketing
75) The concept of the customers receiving the goods exactly at the time when the goods are required by them is called:- Just In
Time
77) Mr Shyam goes to purchase white canvas shoes for his son to the local BATA store in the monsoon season. The price tag says
Rs.49.95.He remembers that the adjacent shoe shop is selling the same shoes for Rs 50/ .He buys from BATA store and feels that he
has received a bargain. What is the pricing strategy adopted by Bata? :- Psychological pricing
78) Brand Equity: It refers to the value of the Brand.
79) JIT – Just in Time
80) MRTP – Monopolies and Restrictive Trade Practices
81) Is cheque collection facility a product offered by banking service or is it just an ancillary service?- It is both a product and a
service
82) If an existing product has to grow in an existing market, what should be the strategy:- Market Penetration
83) Indian banks can adapt marketing strategies to achieve the following goals: Social objective of nation’s development Commercial
objective of making profit.
84) The four Ps of the marketing mix tools were popularized by McCarthy. They are: Product, Price, Place, Promotion
85) Sales force, Public relation, direct marketing and advertising are the sub systems of the marketing mix tool. Promotion
86) Robert Lauterborn suggested that each of the four Ps of marketing mix translates to one of the 4 Cs from a customer's point of
view. Accordingly, PRICE and PLACE relate to: Cost and convenience
87)The seven Ps of marketing mix include the following additional tools: People, physical evidence and process
88) Services do not result in the ownership of anything. Its production may or may not be tied to a physical product. This statement
was made by Kotler & Bloom
89) To the buyer a. product is a complex cluster of value satisfaction. This is a part of the definition of a product by: Theodre Levitt
90) Core benefit, basic product, expected products are three out of the five product levels. The other two are: Augmented products,
potential products
91) Product mix has product width. Product width consists of: Product lines
92) Maturity is a stage in the product life cycle. It comes after the: Growth Stage
93) The product life cycle curve is mostly a______shaped curve: Bell shaped
94) Consumers may have difficulty in evaluating and judging the price and value of the services offered. These indicate the
difficulties involved in service characteristics because their basic quality of: Inseparability
95) Product life cycle is a reality in every product. It also happens at a Brand level
96) Marketing strategies are different in different stages of : Product life cycle.
97) Quality improvement, feature improvement and style improvement. These are the three strategies
of ____________ Product modification
98) The first level of Product in the customer value hierarchy is: Core benefit
99) Sales are going down, profits are declining and competition is increasing. These indicate that the product may be in: Decline
stage
100) Integrative growth is one of the growth strategies. The other two are: Intensive growth and Diversification Growth
101) If an existing product has to grow in an existing market, what should be the strategy? Market Penetration
102) Idea Screening is the first stage of: New Product Development
103) Drop Error while idea screening can lead to: A good idea being dismissed
104) Prototypes are subjected to use by sample consumers in the_______ stage: Product Development
105) Concentric, Horizontal and Conglomerate are three types of : Diversification
106) _______Identifying the product/brand, describing Information about the product, manufacturer etc and promoting the
product through attractive graphics Labeling;
107) HNI – High Networth Individual
108) The Concept of Goriila Marketing is introduced by J.C. Levinson.
109) The Method of sending promotional items to clients is called Drip Marketing.
110) Marketing via e-mail falls under the category of direct marketing.
111) CTR (Click Through Rate) is related to Advertising metrics.
112) Creating a buzz in the industry is an example of Viral Marketing.
113) A non – traditional, low cost, flexible and highly effective marketing is termed as Goriila Marketing.
114) IMC – Integrated Marketing Communications
115) In Double win strategy customer gets price debate
116) Monopoly (only one seller) exists when a specific person or enterprise is the only supplier of a particular commodity, which
relates to a single entity's control of a market to purchase a good or service.
117) Oligopoly (few sellers) which consists of a few entities dominating an industry.
118) MRP – Manufacturing Resource Planning
119) Consumption is the sole end and the purpose of all Production any the interest of the producer ought to be attended to
only so far as it may be necessary for promoting that of the consumer." This statement containing the essence of marketing concept
was made by: - Philip Kotler
120) The first noted reference to the concept of Marketing in the context of the Indian Banks was made by: Mr M.N.Goiporia
in 1987
5. Memor y Bas ed Questi ons 2016-17 ( MCQs)-JAIIB-1
LATEST BANKING & FINANCIAL DATA
(Rs.in cr) Mar31'17 Sep15'17 Small Savings Interest Rates

Aggregate deposits 10805150 10707370
Cash in hand/RBI 570490 531670 P PF 7.8% (01.10.17)
Investments 3043660 3334900 NS C 7.8% (01.10.17))
Bank Credit: 7881890 7781330 Sukanya Smridhi 8.3% (01.10.17))
-Food 53930 53380 Senior Citizen Saving 8.3% (01.10.17))
-Non-Food 7827960 7581530
Cash-Deposit Ratio 5.27 4.95 Parameter end-Sep16 end-Sep17
Investment-Deposit 28.14 31.09 Dollar-spot TT (Rs.) 66.61 65.50
Credit-Deposit 72.95 72.64 BSE - Sensex (points) 27866 31497
Money Stock NSE - Nifty(S&P CNX) 8611 9860
M3 (Out of which) 12844790 12974900 Foreign reserves 37076 402247
a. Currency with public 1263710 1504330 (Million
Gold /Oz$)in USD) 13246 1301
b. Demand deposits-Banks 1410630 1238330
c Time Deposits - Banks 10148950 10213670 Important Banking Indicators
d. Other deposits with RBI 21090 18570 Statutory Liquidity Ratio 20.00% (24.06.2017)
Sources of Money Supply Cash Reserve Ratio 04.00% (15.02.2013)
Net Bank credit to Govt 3869090 4102890 Overnight LAF (of NDTL) 0.25%
Net Bank credit to Govt 8451430 8348940 14-days term Repo(of NDTL)0.75%
Net Forex assets of Banks 2492010 2738900 Reverse Repo Rate 05.75% (02.08.2017)
Repo Rate 06.00% (02.08.2017)
MSF Rate 06.25% (02.08.2017)
Bank Rate 06.25% (02.08.2017)
INDIANECONOMY-IMPORTANTPARAMETERS
RBI's growth estimate for 2017-18 : 7.6%
GDP growth-2016-17 (revised estimate) : 7.1%
GDP@constant mkt prices (cr) : 10656925
GVA@2011-12 basic prices (cr) : 9857672
GDP projected by Govt. for 2017-18 : 16847455
Fiscal Deficit Target (2017-18) 3.2% of GDP : 546532 cr
Revenue Deficit Target (2017-18) 1.9.% 321163cr
Wholesale Price Index : 1.5%
Money Supply (M3) expansion : 12.9%
Exports during 2016-17 : 274.0 bn
Imports during (2016-17) : 379.6 Bn
Export target - 2017-18 (in $) : 310 bn
India's share in world merchandise 1.70%
export
India's :currency rating (S&P) : BB Postv
India's external debt (Jun 2017) US $ : 485.8 Bn
Tax-GDP ratio (2014-15) : 9.93%
Apr- Aug17:Export $ 118.6 bn$ Imports : 181.7 bn
Per capita Income 2015-16 (Rs.) : 93293
rd
Indian economy's ranking in PPP terms : 3
Indian economy's ranking in world in value: 10th
MEORY BASED QUESTIONS
1) One of the pre-emptive reserves is CRR. This is required to be maintained by banks on an ongoing basis and represents ______:
a) Balances with RBI only.
b) Balances with the bank’s currency chests only.
c) Balances with RBI and also the balances with the bank’s currency chests. d) Idle assets with the bank.
2) Banks like any other commercial establishment would face various risks in their operations. The non-payment of interest
charged and
installments due in an account results in what is called :
a) Credit risk b) Operational risk c) Market risk d) Interest rate risk
3) A request has come to you for financing of Rs. 1 crore against a FDR of your bank’s branch located in a different city. Your branch
is networked with that branch. You :
a) Cannot give the loan and request him to approach other branch where deposit is maintained.
b) Can give the loan but only after sending the receipt to other branch for noting the lien in your branch favour.
c) Can give the loan immediately after marking your branch lien on the deposit with the other branch.
d) This is nothing but money laundering and should be avoided.
4) Call Money is lent by a banker for how many days:
a) One day b) Two days c) Five days d) Seven days
5) In India interest rate swaps are commonly traded on which of the following benchmark?
a) LIBOR b) MIFOR c) FEMA d) FERA
6) The aim of balanced funds is to provide:
a) Growth (capital appreciation) b) Regular income c) Both growth and regular income d) Only a
7) Which one of the following is not one of the principles governing in insurance contracts?
a) Principle of Utmost good faith b) Principle of Insurable interest c) Principle of Indemnity d) Principle of Honesty
8) Account holder ABC draws a cheque for Rs. 5,000 favouring Rohan (a minor aged 13 years) or bearer. Rohan presents the
cheque on counter duly signed on the back. What should the banker do with the cheque of a minor?
a) Refuse, since no contractual capacity
b) Pay the cheque after inquiring with ABC
c) Pay to Rohan without any responsibility of bank
d) Ask Rohan to bring his parents e) Section 26 N.I. Act, 1881, does not allow minor to receive payment
9) The liability of drawee of cheque is to make payment, when there is availability of ______:
a) Sufficient funds b) Properly applicable for payment c) Required so by drawer d) All of above
10) Which one of the following crossings is not provided in the N.I. Act:
a) Account payee crossing b) Not negotiable crossing c) General crossing d) Special crossing
11) Who shall be natural guardian in case of married minor girl?
a) Father b) Mother c) Father-in-law d) Mother-in-law e) Husband
12) Primary Dealers mainly deal in: a) Shares b) Mutual funds c) Govt. Securities d) None of these
13) Section 20 of the Banking Regulation Act prohibits a bank from granting any advance against the security of_____:
a) Own shares b) Other company share c) Jewels d) NSC
14) The increase or decrease in the SLR & CRR by RBI ______ the credit creation:
a) Contracts b) Enhances c) Both of the above d) None
15) Investment Bankers are also known as:
a) Foreign Bankers b) Merchant Bankers c) Institutional Bankers d) None of these
16) A Banking company is issued license for banking operations
under : a) Sec 22 of B.R. Act b) Sec 23 of B.R. Act c) Sec 24 of RBI Act d) Sec 23 of RBI Act
17) Cash Reserve Ratio is to be maintained by banks as a per cent of:
a) Time liabilities b) Demand liabilities c) Time and demand liabilities d) Net demand and time liabilities
18) Issuing and servicing of Government debt is managed by:
a) Commercial Bank b) NABARD c) RBI d) All of the above
19) Tandon, Chore, Laxminarayan & Nayak committees are regarding:
a) Working capital finance b) SSI finance c) Project finance d) Priority credit
20) Banker-Customer relation gets terminated in the event of:
a) Death of the customer b) Receipt of Garnishee order c) Insanity d) All of the above
21) A commercial Bank can acquire, hold and deal with any property which is received as security for a maximum period of ______
years as per Sec 8 of B.R. Act:
a) Eight b) Seven c) Nine d) Indefinitely
22) Urban Co-operative Banks are controlled by:
a) NABARD b) State Government c) RBI d) Both b and c above
23) In a Garnishee Order, the banker on whom Garnishee Order served is:
a) Judgement Debtors Creditor b) Judgement Creditors Creditor
c) Judgement Creditors Debtor d) Judgement Debtors Debtor
24) When banks extend loans against LIC Policies, the charge created is:
a) Hypothecation b) Pledge c) Assignment d) Mortgage
25) ________ is not barred by law of limitation:
a) Pledge b) Hypothecation c) Term Loan d) Guarantee
26) Banks in India need to take registration from _____ to undertake capital market activities:
a) AMFI b) RBI c) GOI d) SEBI
27) Under Gilt fund, Government securities have ______ default risk:
a) More b) Less c) No d) None
28) LAN is used to connect computers within a branch. Each independent system is known as:
a) Node b) Server c) ALM d) Computer
29) Navdeep wants a demand draft striking the word ‘Order’ and writing the word ‘Bearer’. Can bank help him or not:
a) Bearer draft is unlawful under Section 31 of RBI.
b) Bearer Draft can be issued like a cheque.
c) Signature of the payee should be attested on the back of draft by the issuing branch.
d) Attestation of the signature of the payee on a separate slip of paper by bank (without striking out the word ‘Order’ on draft).
30) An NRE account can be opened by _____:
a) Foreign nationals only
b) Foreign Institutional investors only
c) It can be opened by both NRI as well as foreign national
d) It can be opened jointly by NRI with a close relative on ‘F or S’ basis.
31) Right to combine two accounts by banks is called _____:
a) Garnishee b) Lien c) Set-offd) None of the above.
32) Attachment order is issued by whom:
a) Income tax officer b) Sales tax officer c) Both a and b d) public debt office.
33) Under the Consumer Protection Act, District Forum has a power to deal with cases up to Rs. _____ lakhs:
a) 10 b) 50 c) 20 d) 100
34) Which of the following alteration in a CTS Cheque is permitted if authenticated by the drawer:
a) Name of payeeb) Amount in wordsc) Date d) None of the above
35) For meeting day-to-day receipt and expenditure mismatch, RBI provides _____ to governments.
a) Treasury Bills b) Ways and means advance c) Dated securities d) None of the above
ANSWER
Q A Q A Q A Q A Q A
1 C 2 A 3 B 4 A 5 B
6 C 7 D 8 C 9 D 10 A
11 E 12 C 13 A 14 C 15 B
16 A 17 D 18 C 19 A 20 B
21 B 22 D 23 D 24 C 25 A
26 D 27 C 28 A 29 D 30 D
31 C 32 C 33 C 34 C 35 B
68) One of the pre-emptive reserves is CRR. This is required to be maintained by banks on an ongoing basis and represents ______:
a) Balances with RBI only.
b) Balances with the bank’s currency chests only.
c) Balances with RBI and also the balances with the bank’s currency chests. d) Idle assets with the bank.
69) Banks like any other commercial establishment would face various risks in their operations. The non-payment of interest
charged and installments due in an account results
in what is called :
a) Credit risk b) Operational risk c) Market risk d) Interest rate risk
70) A request has come to you for financing of Rs.1 crore against a FDR of your bank’s branch located in a different city. Your branch
is networked with that branch. You :
a) Cannot give the loan and request him to approach other branch where deposit is maintained.
b) Can give the loan but only after sending the receipt to other branch for noting the lien in your branch favour.
c) Can give the loan immediately after marking your branch lien on the deposit with the other branch.
d) This is nothing but money laundering and should be avoided.
71) Call Money is lent by a banker for how many days: a) One day b) Two days c) Five days d) Seven days
72) The aim of balanced funds is to provide:
a) Growth (capital appreciation)b) Regular income c) Both growth and regular income d) Only a
73) Which one of the following is not one of the principles governing in insurance contracts?
a) Principle of Utmost good faithb) Principle of Insurable interest c) Principle of Indemnity d) Principle of Honesty
74) Naveen wants a demand draft striking the word ‘Order’ and writing the word ‘Bearer’. Can bank help him or not:
a) Bearer draft is unlawful under Section 31 of RBI.
b) Bearer Draft can be issued like a cheque.
c) Signature of the payee should be attested on the back of draft by the issuing branch.
d) Attestation of the signature of the payee on a separate slip of paper by bank (without striking out the word ‘Order’ on draft).
75) An NRE account can be opened by _____: a) Foreign nationals only b) Foreign Institutional investors only
c) It can be opened by both NRI as well as foreign national
d) It can be opened jointly by NRI with a close relative on ‘F or S’ basis.
76) Right to combine two accounts by banks is called _____: a) Garnishee b) Lien c) Set-off d) None of the above.
77) For meeting day-to-day receipt and expenditure
mismatch, RBI provides____________ to governments.
a) Treasury Bills b) Ways and means advance c) Dated securities d) None of the above
78) To get protection under Sec. 131 of Negotiable Instruments Act, the banker should collect:
a) Only crossed cheques
b) In good faith & without negligence
c) A crossed promissory note for his customer d) A crossed cheque for his customer only e) a, b, & c
79) Introduction is must in respect of all deposit accounts because:
a) Introducer is responsible for any liability and losses created by the account holder he introduces
b) Protection under Section 131 of NI Act will not be available to the collecting Bank without introduction
c) It will enable the bank to check the frauds d) Banking practice e) None of the above
80) A social engineering attack used by cyber criminals to steel sensitive information of bank customers is called?
a) Virus b) Phishing c) Vishing d) All the above
81) Demand liabilities are defined as: a) The Money which is demanded, b) The liability which remains payable at any time
c)The liability which must be met on demand d) All the above
82) A Banking company can hold immovable property for its
own use for a period ___________ : a) Of three years b) Of five years c) Exceeding five years d) Exceeding seven years
83) A Minor is not competent to become a party on cheque as:
a) Payee b) Drawer c) Drawee d) Endorser
84) An Inchoate instrument is one, which does not have:
a) The amount b) The date c) Name of the payee d) Signature of the drawer e) a, b & c
85) Law of limitation is not applicable in respect of:
a) Advance against pledge of shares.
b) CC granted against hypothecation of inventory.
c) Term loan secured by mortgage of Plant & Machinery d) Bank Term Deposit
86) How is data processing handled in a Multi-user computer net working system?
a) At a centralized place b) In the computer being used c) At multi point situations d) At the networking place
87) Initial Public Offering means that an existing or a new
Company is offering__________ to public / QIBs: a) Existing equity (shares) b) New Equity c) Either d) Neither
88) Depositories hold shares in ______ form: a) Physical b) Dematerialized c) Either a or b d) Neither
89) _____ provide Clearing House facilities for netting of Payments and Security delivery:
a) Primary dealers b) Banks c) Stock exchanges d) All
90) Leasing, Hire purchase and Bill discounting are the main functional domains of:
a) NBFCs b) Banks c) Mutual funds d) None
91) _____ is the regulatory authority for Mutual funds: a) IRDA b) SEBI c) RBI d) Ministry of Corporate affairs
92) Primary dealers deal in __________ : a) Shares b) Insurance c) Government securities d) None
93) Decrease of CRR & SLR has the effect of:
a) Decreasing Credit creationb) Increasing Credit creation c) No effectd) None of these
94) The objectives of SLR are: a) To restrict expansion of Credit, b) To ensure that Banks remain solvent
c)To increase volumes in Government securities d)All of the above
95) Ramu, a minor aged 14 years, desires to open a saving account. His mother is illiterate and his father has become a yogi. He has
his grand parents. Who will be his natural guardian?
a) Mother b) Father c) Grand father d) Guardian appointed by court
96) The Grand Bazaar super store sells its very famous soft bread at Rs.7/- as against Rs.8.50 elsewhere. The shop is actually making
a loss in this transaction. However many people in the area go to Grand bazaar to buy bread. While there, they normally buy other
household requirements also. What is the pricing strategy here?
a) Special event pricing b) Geographical pricing c) Cash rebate d) Loss leader pricing
97) When colour television was first introduced in Mumbai, each set was priced at Rs.16000/. After two months of sales, the prices
were seen at Rs.15000/. Two months later, the price went down further to Rs.14000/. In this hypothetical example, what was the
pricing strategy of the TV company?
a) Introductory pricing b) Discriminatory pricing c) Market skimming pricing d) None of the above
98) Telephone bills are normally spilt in to a monthly basic minimum and varying call expenses. This pricing strategy is termed: a)
By-product pricing b) Two-part pricing c) Promotional pricing d) None of the above
99) ______ is entrusted with the task of developing international trade in India:
a) RBI b) EXIM Bank c) Ministry of commerce d) All of the above
100) As per SEBI guidelines, in a Book Building process the cap in the price band:
a) Should be at 10 per cent of the floor price b)Should not be more than 20 per cent of the floor price c) No limits d) None.
101) Except one of the following, others are known as Non Fund based facilities:
a) Letters of Credit b) Bank Guarantees c) Co-acceptance of Bills d) Trust Receipt
102) RBI directives to Banks not to lend against a particular security or to lend at a particular margin, is termed as:
a) Credit Control b) Credit squeeze c) Selective Credit Control d) Exposure selling
103) CDR System comprises of ___________ tiers. a) 1 b) 2 c) 3 d) 4
104) Interest on Government securities on fixed basis is known as:
a) Bank Rate b) Coupon Rate c) Prime Lending Rate d) Bench Mark PLR
105) ______ are local institutions functioning like Banks:
a) Local Area Banks b) Indigenous Banks c) Private Banks d) Financial Institutions
106) What is the minimum amount of loan under Equitable Mortgage?
a) Rs. 100 b) Rs. 200 c) Rs. 500 d) No limit
107) The holder of a Negotiable Instrument is Holder in due course if:
a) He receives the instrument in good faith and without negligence
b) He receives the instrument before its maturity
c) He receives the instrument for lawful consideration d) All of the above
108) Attachment order is issued by whom: a) Income tax officer b) Sales tax officer c) Both a and b d) public debt office.
Answer
68 C 69 A 70 B
71 A 72 C 73 D 74 D 75 D 76 C 77 B
78 E 79 B 80 B 81 C 82 D 83 C 84 E
85 D 86 A 87 C 88 B 89 C 90 A 91 B
92 C 93 B 94 D 95 A 96 D 97 C 98 B
99 B 100 B 101 D 102 C 103 C 104 B 105 B
106 D 107 D 108 C 109 A 110 D 111 D 112 A
6. MODEL TEST PRACTICE: TEST YOURSELF
PRACTICE TEST PAPER-1

01. if there are declining sales leading to declining profits and no possibility of increasing and improving them, which of the following
strategy will be adopted by an organization: a product modification; b more of product modification and some production elimination c
some production modification and more of production elimination; d product elimination.
02. Which among the following is correct in the context of branding of products: a a brand can be a sign or symbol but not a name b
value of brand is its power to capture consumer preference and loyalty; c brands help in providing legal protection due to unique features;
d strong brands enjoy high level of consumer awareness and loyalty
03 A manufacturer of a consumer product keeps the price of a new product at a substantially high and over a time period to reduce
it when the demand reduces. Such pricing is called a geographical pricing;
b promotional pricing; c market skimming pricing; d psychological pricing
04 Which among the following is a component of promotion mix (a) advertising (b) personal selling (c) public relations (d) sales
promotion: a a to d all; b) b and c only c) a, b and d only; d a, c and d only
05 The system of marketing information is that pertains to marketing: a) the structure of people, equipment and procedures
for generation and processing of information; b) the software used for collection of information c) the computer hardware
which is used for handling database; d) the set of inputs to collate the information
06 Which of the following cannot be included in value added services that are offered under wholesale banking by banks: a
derivative desk; b letter of credit; c employee trust; d channel financing.
07 U/s 22 of RBI Act, RBI (which of the following is not correct) a) has authority to lssue and manage currency of India; b) issues bank
notes and currency notes; c)can issue bank notes having denomination Rs.2 to Rs.10000; d the bank notes are legal tender at
any place in India.
08 Govt. regulates the banking system by affecting the decision making by RBI since (a) Govt. holds the entire share
capital of RBI (b) Govt. can give direction to RBI u/s 7 (1) of RBI Act. (c) Govt. has absolute powers over the banking system: a) a to
c all correct; b) a and b only are correct; c) b and c only are correct; d) a and e only are correct
09 A is a type of transferable financial instrument traded on a local stock exchange of a country but represents a
security issued by a foreign publicly listed company: a depository receipt; b derivative;
c option; d participatory notes
10Anytransferof sharesinabankingcompanywhich exceeds% of paid upcapital of thebank requires acknowledgementby beforeregistration ofin the
books of thecompany: a 5%, SEBI; b 5%, RBI; c 10%, RBI; d 10%, Company Law Board
11 Authorised capital of a nationalized bank cannot Rs. cr: a 100 cr; b 500 cr; c 1000 cr d 3000 cr
12 Customer is defined as per provisions of: a Indian Contract Act; b Negotiable Instrument Act; c General Clauses
Act; d KYC Guidelines
13 A bank which is authorised by the issuing company to issue depository receipts against issue of foreign currency
convertible bonds or ordinary shares of the issuing company, is called a overseas depository bank; b inland
depository; bank; c custodian bank; d authorised bank
14 Bank's obligation to pay the cheque drawn by the customer u/s 31 of NI act exists, in which of the following circumstances: a
when the amount in words and figures differs; b when there is notice of death of the customer; c when an
attachment order has been received; d when the signatures of the drawer are genuine but differ
15 Bankers' obligation to maintain secrecy of customer's account is (which of the following is not correct):
a as per provision of Banking Companies (Acquisition & Transfer of Undertakings) Act 1970; b as per implied contract
between bank and customer; c it continues during currency of the account and also after closure; d none of the above
16 Issue of securities in the primary market is subject to fulfillment of a no. of requirement stipulated by:
a S E B I ; b I RDA; c RBI; d all the above
17 Definition of the term 'banking' is as per Section 5 (b) of the which of the following:
a Banking Companies (Acquisition and Transfer of undertakings) Act; b Banking Regulation Act;
c RBI Act; d NI Act
18 U/s 171 of Indian Contract Act, the general lien is available to (a) banker (b) wharfingers (c) factors (d) attorneys of High
Court provided there is no agreement to the contrary: a a, b and d only; bb, c and d only; c a, b and c only; d a to d all
19 Which of the following statement regarding a broker is not true: a he is a member of stock exchange; b he is
registered with SEBI; c a sub-broker is affiliated to a member of recognised stock exchange and registered with SEBI; d
none of the above
20 First item on the debit side of the account is discharged or reduced by the first item on the credit side in the chronological
order as per which of the following: a rule of appropriation; b rule in Clayton case; C right of set off; d banker's general
lien
21 Which among the following is not an essential feature of a mandate: a it is given on a simple paper; b it does
not require registration with any Govt. authority; C in joint accounts and in partnership it should be signed by all account holders / all
partners. d It should be properly stamped.
22 A bond issued at a discount and repaid at its face value is called, a bonds: a coupon bond; b convertible bond; C
commercial paper; d zero coupon bond
23 An attachment order of Rs.40000 on a partnership firm is received, whose current account shows a balance of Rs.4000. The individual
accounts of the partners A, B and C are showing credit balance of Rs.20000, Rs.17000 and Rs.1250 respectively. To meet the payment
stated in the order, how much amount will be payable from A's account ?
a Rs.16250; b Rs.17750; c Rs.18750; d Rs.40000; e Rs.19750
24 Your branch receives a garnishee order. It attaches all sums owning or accruing due to Mr. Ashok and Mr. Anand. There is
no account at the branch in the joint names of Mr. Ashok and Anand. But they maintain their individual accounts. Under these
circumstances: a The court should be advised that there is no account in the joint names of Ashok and Mr. Anand. Hence, the garnishee
order can not be given effect to; b The garnishee order will attach the individual accounts of Mr. Ashok and Mr. Anand as they are
jointly and severally liable for the joint debt; c The matter should be referred to the court for clarification; d Since the order is
not applicable, the bank need not take any action thereon.
25 Security receipt is issued by the to a qualified institutional Buyer in pursuance to a securitization program:
a) Central Govt; b Securitization Companies; c Rated companies; d all the above
26 Which of the following instrument has three parties i.e. drawer, payee and drawee, to the instrument:
a bill of exchange and cheque; b bill of exchange and promissory note; c promissory note and cheque;
d promissory note and demand draft
27Whichofthefollowingisnotafeatureofan'accountpayeecrossing': a it is defined as per Section 130 of NI Act; b its payee is holder
only; c it can be endorsed and transferred any no. of times; d all the above
28 Which of the following is not a function of SEB I: a to regulate securities market; b to protect the interest of investors in
securities; c to promote the development of securities market d none of the above
29 Which among the following is a false statement: a signature of the payee or endorsee for negotiation of the cheque is called endorsement;
b endorsement can be only on the back side or separate sheet of paper called allonge; c a cheque can be endorsed for any
number of times; dendorsement is possible on bill of exchange, promissory note and cheque
30 Which of the following endorsements match their description: a pay to X Rs.10000 and Y Rs.2000 (the cheque is for Rs.12000) — partial
endorsement; b pay to X only — restricted endorsement; c pay to X when he returns from UK — conditional endorsement d pay to X
without my responsibility — sans recourse endorsement
31 The mechanism for pooling resources from the public by issuing units to them and investing the funds, so collected in securities
in accordance with objectives disclosed in an offer document, is called a publicissue; b mutualfund; c)securitization; d
initial public offering
32 A cheque is a dated January 12, 2007 and presented for payment by the payee on July 13, 2007. The paying bank returns the cheque stating
that it is stale. Which among the following is not correct in this connection: a) the term 'stale' is defined in NI Act Section 138; b the cheque
becomes stale after 6 months from date of its issue; cthe term 'stale' is used as a matter of practice; d a stale cheque can be revalidated
with fresh validity up to 6 months (w.e.f. 1.4.12, the validity period of cheque has been restricted to 3 months in India, by RBI, u/s
35A of B R Act)
33 A post-dated cheque is returned by the bank without payment because, the bank is exposed to the following risk (a) customer dies before
date of the cheque (b) if garnishee order is received before date of the cheque (c) if payment is stopped by the drawer before date of the
cheque (d) if another cheque is returned for insufficiency of funds, after date of the post-dated cheque : a a, b and c are correct; b
a to d all are correct; c a, c and d only are correct; d b, e and d are correct
34 In a gilt fund, the mutual funds make investment in: a govt. securities; b corporate securities;
c corporate debt d govt. and corporate debt
35 Bank B made payment of a cheque with following endorsements. In which of these cases the payment will not be deemed to be a
payment in due course: a endorsement by X the payee, in favour of Mr. Y and the cheque has not negotiable crossing. b endorsement by X,
to Y, Y to Z and Z to A; c endorsement by Renu wife of Mr. Sunil
Kumar, while the cheque is in favour of Mrs. Sunil Kumar; d endorsement by X the payee in favour of Mr. Y while the cheque is having
payee's account crossing
36 Bank B makes payment of the following cheque. For which of these the bank will not get protection:
a a cheque with one endorsement as forged endorsement; b a bearer cheque bearing an endorsement in favour of X while
payment is received by Y without endorsement from X; c a cheque the amount of which has been filled by the payee and wasleft blank by the
drawer; dachequehavingamountinwordsas Rs.fivethousandwhile amountin figureswasleftblank
37 Forcollectionofwhichofthefollowing,thecollectingbankwillget protection: a a cheque that does not bear any crossing beforeit is handed
over; b to thebank. Bank puts its own stamp to present the cheque for clearing; c a cheque, as first deposit in the newly opened account after
complying with KYC guidelines; c acheque written intwo inks,twohandwritings and two scripts; d all the above
38 The legal status of a mutual fund is in the form of a a partnership firm; b proprietorship; c joint stock company d trust
39Which of thefollowingis notcorrect in the context of dishonour of chequeforinsufficiency of funds: a tofilethesuit, holderis required to givea
noticetodrawer within; b30days of receiptofinformationaboutdishonor; c tofilethesuit,theholderistogivenoticetodraw tomakepayment within
30daysofreceiptofnoticebydrawer; c courtcanimposefineuptodoubletheamountofchequeonthe drawer; d drawercanbe imprisoned up
to 2years,if found guilty.
40 In which of the following situations, the bank can favourably accommodatethecustomer: a Mr.Suresh,a valued customercomes to
obtainpaymentof a chequedrawn in hisfavourand crossed byhim, bymistakeand now demands cashpayment. b Mr.Phadke, comes witha
chequein favourof his wifeand crossed account payee, forcreditto his account. His wifehas endorsed thechequeinhis favour; c achequedatedJune
12,2004is presentedforpaymenton Dec 12,2004as Dec11,2004was a Sunday; d achequeinwhichdate,amountandpayee'snameisleftblank
by thedrawerandiscompletedbyMr.Dinesh,whodemandsitspayment
41 Who fixes the insurance premium rates for some of the general insurance products: a) SERI; b)Insurance Regulatory & Development
Authority; c) Tariff Advisory Committee; d) all the above
42. Obtaining introduction from the existing customer for opening a new deposit account is essential (a) to get protection Ws 131 of NI Act
against conversion (b) to prevent money laundering (c) to comply with KYC directives of RBI. A) a to c all; b) a and b only b and c only; d)
a and c only
43. Which of the following is correct with regard to a minor:
a) a minor is a person of less than 21 years of age where the guardian is appointed by a court;
b) a minor can open a bank account under provisions of Indian Contract Act with the provision that no transaction should result in
debit balance in his account;
c) a minor can open a self operated bank account because he can draw a cheque and has been permitted to open the account by RBI also
d) loan given to minor for necessities is recoverable from him personally.
44. insurance policy taken by a business firm on the life of very important person to protect the firm against financial loss, is called a)
Master policy; b) Keyman policy; c) VIP Protection policy; d) umberrima fides
45. In the following situations, which decision taken by a bank is not correct, in case of an insolvent customer:
a) a cheque signed by the insolvent person as drawer is presented for payment and bank returns it unpaid b) insolvent persoh comes to
open a new deposit account and bank refuses to open the account; c)an insolvent person comes as payee of a cheque and bank refuses to
pay to him; d) none of the above
46.To redress customer grievances in respect of insurance contract on personal lives, there is an institution called ________ a)
Insurance Ombudsman; b) Insurance regulator; c) Insurance Intermediary;
d Insurance Regulatory and Development Authority
47 Karta in an HUF does not have which of the following authority: a) to manage the business or property; b to raise loan to run
the family business and create charge on HUF assets to secure such loan; c) to appoint agent that may be one of the coparceners or even
outside; d) none of the above
48 Which of the following is not a correct statement in the context of registration of a partnership firm:
a provisions for registration of a firm are u/s 58 of Indian Partnership Act;
b registration of a firm is optional and not compulsory
c if a firm is not registered, neither it can file suit in its own name, nor anyone else can file suit on this firm; d if a firm is registered, it can file
suit in its own name and suit can be filed on the firm by others, whether registered or unregistered.
49 The minimum capital to start a new Insurance company in India is: a) Rs.100 cr; b) Rs.75 cr;
c) Rs.50 cr; d) Rs.10 cr
50 Where a minor is admitted for benefit, in an existing firm (a) he has the authority to become partner on attaining majority (b) he has the right
not to become partner on attaining majority (c) if he remains silent regarding whether to be partner or not to be, he is deemed to have not become
partner (d) if he chooses to be a partner his liability begins from date of his becoming full-fledged partners. A) a, c and d are correct; b) a, b and d
are correct; c) only a and b are correct, d) only a and c are correct.
51 A bank has to give loan to a company for which the company has given certified copy of Articles of Association. Bank has doubt that the
Articles of Association stands amended and the company has not given the amended copy. What source can be used by the bank to have copy
of the amended documents: a other bank of the company; b S E B I ; c Registrar of Companies; , d any of the above
52 Borrowing powers of the Board of Directors of a company (which is not true): a) are mentioned in the Articles of Association b. If not
mentioned, in the Articles, it is equal to paid up capital reserves of the company; c) where board of directors does not have
adequate powers, it has to approach the shareholders u/s 293 (d) (i); dnone of the above
53. If there is default of repayment by the buyer in case of factoring and the factor is able to recover the amount from the seller,
it is called a) non-recourse factoring; b) without recourse factoring; c) recourse factoring; d) bills discounting
54 Bank-B is maintaining account of a sports club which is operated by its Secretary and President jointly. Bank receives a notice (on
Feb 10, 2013) of death of the President on Jan 31, 2013. Two cheques of Rs.5000 each dated Jan 12, 2013 and dated Feb 02, 2013
are presented for payment on Feb 24, 2013. The bank shall: a) pass both the cheques as these are signed by them in the
capacity of an agent. b) return both the cheques as the death of one of the drawers has taken place; c pass the 1 s' cheque and
nd nd st
return the 2 cheque; d pass the 2 cheque and return the 1 cheque
55 A charitable trust has a current account with your bank and now it wants to raise a loan for furtherance of its activities.
The loan can be allowed aif the trustee decide and pass a resolution to that effect; b if the current account operating trustee
make a request and offer his guarantee also; c if the Trust Deed provides for that the loan; d the loan will not be
allowed to a Trust
56 When the seller of machinery or other capital equipment is agreeable to extend long term credit to the buyer of
the machinery, on the guarantee of a bank, such guarantee is called a specific guarantee; b deferred payment guarantee; c
particular guarantee; d performance guarantee
57 A customer of the bank has written a will and he has died. The execution of this Will will be carried by:
a administrator; b assignee; c liquidator; d none of the above
58 Which of the following statements can be considered to be true: a Memorandum of Association of a company is called document of
Indoor management as it contains internal rules of the company; b Trustees can raise loan for the trust at their discretion c Objects of a
company are stated in Articles of Association; d A person appointed by a court to manage the property of deceased person is
called 'administrator'
59 The Basel Committee on Banking Supervision, is a committee that was constituted by: a RBI and World Bank; b International
Monetary Fund; c United Nations; d none of the above
60 Which is not correct with regard to rate of interest in NRI opened accounts: a NRE FDR account — as per ceiling rate fixed by
RBI and linked to Bank Rate; b FCNR account — as per ceiling rate fixed by RBI and linked to LIBOR; cNRE-Saving account — bank
discretion but not more than domestic rates; d NRO account — bank discretion but not more than domestic rates
61 In which of the following circumstances, the banker customer relationship does not come to an end
a death of the customer; b insolvency of the customer; c insanity of the customer;
d receipt of garnishee order which has been satisfied by payment
62 X is maintaining a SB account with Popular Bank and wrongly credited an amount of Rs.12500 to his account. This was entered in his pass
book also. Later on when the mistake came to bank's notice it debited customer's account but did not inform the customer. Meanwhile the
customer issued a cheque on the basis of this balance which was dishonoured by the bank. a customer can ask for damages for return of his
cheque although amount was recoverable from him, had the cheque been paid. b customercannotask fordamages as bank has only rectified
the mistake. c It was customer's duty to check the pass book for brining the error to bank's notice. Hence customer cannot claim any
damages none of the above
nd
63 2 Pillar in Basel 2 relates to: a) minimum capital; b) supervisory review; c) market discipline; d) risk management
64 Which among the following statements is true in connection with customer account:
on receipt of information of customer's death verbally, the bank cannot stop payment in the account ; b) when an account is to be
closed by the bank, it is not under obligation to tell the reasons to the customer; c) when a customer wants to close his account with
the bank, he is not under obligation to disclose the reasons to the bank; d) pass-book is the copy of the bank records, available with
the customer
65 RBI conducts on site inspection and off-site supervision of Indian banks and based on its finding, RBI rates the banks on
important parameters called _________The word A of these parameters stand for_________
a CACS, advances; b CAMELS, assets; c CACS, asset quality; d CAMELS, asset quality
66 As per Basel 2 recommendations, the Tier 3 is limited to % of a bank's Tier I capital that is required to support market risk: a
5 0 0 % ; b 2 5 0 % ; c 100%; d 50%;
67 Mr. K had deposited a sum of Rs.2 lac in his saving bank account. A letter is received from the local Police that Mr. K has
been arrested for committing a fraud. A cheque of Rs.15000 has been received through clearing in the account for payment, after
receipt of notice from the Police. a cheque will be paid; b cheque will be paid after having permission from the Police; c cheque
will be paid after getting permission from the customer and the police; d cheque will not be paid
68 X issued a cheque of Rs.22000 payable to B or order. The cheque is misplaced and found by C. C forges B's signatures and
endorses in favour of D, who obtains payment from the bank a) this is payment in due course and bank will protection u/s 85
(1) of NI Act; b) this is payment in due course and bank gets protection u/s 131 of NI Act; c) for this payment on the basis of a
forged endorsement, bank is liable; d) bank and C are liable in equal proportion
69 Market risk takes the form of (which one is not correct): a commodity price risk; b interest rate risk; c loan
default risk; d liquidity risk
70 A demand draft is purchased by P. After 5 days, P comes to the bank and requests the bank to stop the payment, as the
DO is reported to have lost in transit: a) the issuing branch will immediately instruct the drawee branch to
stop payment of DD. b) the issuing branch will first verify the non-payment and then give the instructions for stop payment
c) the payment of DO cannot be stopped. Hence request of P will not be entertained. D) if it is common request from payee
and drawee branch, it will be done
71 Which among the following is the objective of issuing KYC guidelines by RBI: a) check fraudulent activities of the
borrowers; b) check money laundering activities; c) avoid undesirable customer to enter the banking system d) a and b;
e) b and c;
72 In which of the following situations different partners of the combination remain separate entities:
a alliance; b amalgamation; cconsolidation; d merger;
73 What is the objective of securitisation of financial assets? a to enable the banks in speedy recovery of bad loans; b
to sell the securities without intervention of the court, only if loan goes bad; c to acquire assets and then sell the
same at profit d) recycling of funds
74 The functions of purchase of receivables, maintenance of receivable ledgers and collection of dues on due date, under factoring
becomes the function of : a) Seller; b) Factor; c) Buyer ; d) A & C
75 In addition to the normal services as defined in the Banking Regulation Act, banks also undertake activities like project
appraisal, underwriting of issue, technical know how etc. This business is called____________a) consultancy services; b)
bancassurance; c) merchant banking; d) advisory services; e) non-fund credit business
76 A eCommerce transaction refers to exchange of information by way of__________ , for selling and buying between the
consumer and the seller a credit cards; b debit cards; c paperless instructions; d all the above
77 Which of the following is not correct in respect of targets within priority sector: a weaker section target for Indian banks is 25 %
of priority sector; b micro & small enterprises credit target for foreign banks is not minimum percentage basis; c export credit is
12% of ANBC for Indian banks ; d Agriculture credit target is 45% of priority sector credit for Indian banks
78 Two companies are merged. One of these is supplier of goods to the other. This merger is known as:
a horizontal merger; b vertical merger; c conglomerate merger; d concentric merger
nd
79 Under Tandon Committee's 2 method of lending, the working capital margin i.e. net working capital should be: a 25% of
the projected sales; b 25% of the current assets; c 25% of the bank limits; d 25% of the long term sources
80 Which of the following is not a source of working capital for manufacturing firm:
a sundry creditor; b unsecured advances; c bank term loan; d bank overdraft
81 Banking Codes and Standards Board of India, has been constituted as a : a joint stock company;
b trust c society; d partnership firm
82 Computeration in banks can bring improvement in the area of (a) customer service (b) house-keeping (c) decision making (d)
productivity. Which of these is correct: a a, b and c only; b b, c and d only;
c a, c and d only; d a to d all
83 Which of the following is not an advantage of the multi-user computer system through networking:
a corporate level information is available at one place; b costly hardware can not be shared between various user
due to which it is not cost effective; c information can be shared easily between various users; d computing resources can
be used economically by processing the high volume data
84 In each node is joined to the central node by a separate link: a) star topology; b) bus topology; c) ring topology; d)
none of the above
85 In star topology for a local area network: A) each node is joined to each other by a common link; b) all
nodes are linked to the server through individual nodes; c) each node is joined to the central node by a separate link; d) the
nodes are connected through a continuous cable
86 In an ATM, the PIN: a) stands for postal index number; b) is randomly generated sequence of digits c)
stored in magnetic strip of the card; d) b and c both
87 Cheque truncation can be done by (a) using image processing (b) using MICR data (c) sending cheques by courier or speed post for
early delivery. A) a, b and c all; b) a and b only; c) b and c only; d) a and c only;
88 Spend now and pay later stands for: a) ATM card; b) Credit card; c) debit card; d) electronic purse
89 The decision support system makes use of (a) query language (b) adhoc report generator (c) statistical analyzer (d) graphics a) a
to c only; b) b and c only; c) a to d all; d) b, c and d only
90 The cheque truncation can be done (a) by using MICR data (b) by sending cheques through courier (c) by using imaging
technology a) only c; b) only a; c) only a and c; d) a to c all
91 Compared to a manual system, the consequences of an error in a computerized system are more serious due to (a) errors
being generated at high speed will involve higher cost to correct them (b) computer system processes more data (c) users of
computer systems perceive the computer output to be always correct a) a to call; b) only b and c; c) only a and.b; d)
only a
92 Which of the following features do not match in case of goods and services, as a product:
a goods are search products and services are experienced products; b) goods and services are tangible; c) goods
relate to a stage prior to purchase of use; d) services are the products that relate to a stage after buying or
consuming.
93 A restaurant provides food as well as service along with the infrastructure for use. This type of product can be classified as:
a pure tangible goods; b tangible goods with accompanying services; c hybrid; dmajor service with accompanying minor goods
94 A product means something that can be offered to satisfy a want or need which can be physical goods, services, persons, place, idea
etc. Which of the following does not match: a) idea — adult education; b) places — Goa, Kashmir; c) persons — BismillaKhan d)
services — tooth paste
95 Amount is immediately recovered from the card holder online for the amount of card used, in case of: a) a debit card; b)
a post-paid card; c) a credit card; d) all the above
96.Banking operations in India are governed mainly by_______ Act and ________ Act and the regulator of banks________ a Banking
Regulation Act, NI Act, RBI; b RBI Act, NI Act, RBI; c Banking Regulation Act, RBI Act, RBI; d Banking Regulation Act, RBI
Act, SEBI
97 Banking means acceptance of for the purpose of lending and u/s of Banking Regulation Act:
a deposits, investments, 6 (c)(i); b deposits, investments, 5 (b); c deposits, advances, 5 (c); d ) deposits, investments, 5 (d)
98 Which of the following is helping the banking system in sharing the information about the credit history of households: a Banking
codes and standard Board of India; b Credit Information Bureau India Limited;
c CRISIL; d all the above
99 A bank purchases a commercial complex from XYZ in realization of loan. What is the disposal period and RBI discretion to extend the
said disposal period u/s of Banking Regulation Act: a 7 years, 5 years, Sec 9; b 7 years, 7 years, Sec 9; c 5 years, 7 years,
Sec 6(1); d ) 5 years, 5 years, Sec 6(1)
100 Private banks and foreign banks are regulated byAct for their constitution and Act and Act for their business of Banking:
a) Companies Act, NI Act, RBI Act; b) NI Act, B R Act, RBI Act; c) Companies Act, B R Act, RBI Act; d )Companies Act, B R Act, NI
Act
101 Your branch had allowed an overdraft of Rs. 8600 to M/s. Chandgi Ram & Co. with Mr. Ram Lal, Mr. Sham Lal and
Shekhar as partners. The overdraft remains unadjusted despite several demand notices served on the firm. It is noticed that Mr.
Shekhar also maintains a savings account at the branch showing a credit balance of Rs. 9365. In this case.
a The bank can exercise right of set-off and adjust the overdraft in firm's account to the debit of partner's personal account.
b The bank can not exercise the right of set-off as the accounts are in different names.
c The bank can exercise the right of set off provided the letter of set- off was obtained from the partners at the time of
allowing overdraft to the firm .
rd
d The bank recovers 1/3 of the overdraft to the debit of the savings account of Mr. Shekhar and the remaining balance can
be recovered from other partners proportionately.
102 X is having loan account duly guaranteed by Mr. & Mrs. Y. They are having a an FDR for Rs.40,000/- with maturity value of
Rs.57010/-. X defaulted in repayment of Loan and bank on maturity adjusted the loan account of X with the maturity value of
FDR and credited the balance to SB Mr. Y and Mrs.Y. Mr. and Mrs.Y objected to this adjustment since the loan is time barred.
a bank could not do so. Hence entry should be reversed
b bank could not do so and if party requests, entry should be reversed
c bank had right of set off which it has correctly used (presuming that notice had been given doing so)
d bank had lien over the FOR due to which bank action is correct
e bank is liable for the loss.
103 M/s Santosh Enterprises had been sanctioned a cash credit limit of Rs.2 lac with present balance of Rs.1.90 lac which is
overdue for 2 years. The firm also has a term loan of Rs.50000 which is overdue for 6 years, the documents of which are time barred.
Mr. Swamy a debtor of the borrower, deposits with the bank Rs.30000 in their account. What would you do with this money:
a bank will have to enquire from the borrower as to how to use the money bank can credit to term loan account only
c bank can credit the money to cash credit account only
d bank can appropriate the money in any of these two accounts
104 Your branch had sanctioned a term loan of Rs.9 lac to M/s Sunil Trading Company for purchase of a truck. After payment of few
initial instalments, the firm stopped paying the instalment. They have also been maintaining a current account and deposited
Rs.120000 for payment of certain cheques issued by them representing tax dues payments, from the current account. They forgot to
mention the number and particulars of the account on the pay-in-slip. The branch manager directed the staff to credit the amount to
term loan account. When the fact came to the notice of party, they objected to this:
a bank's decision to credit the amount in term loan without permission of the depositor is wrong.
b bank cannot credit the proceeds to the term loan when the intention was to deposit in the current account.
c bank's decision cannot be questioned in the light of facts that there was no direction from the depositor about where to appropriate
d bank's decision cannot be questioned since it has used the funds for repayment of a due loan.
e) none of the above
105 The cash credit account of M/s Ramesh Chander Sham Kumar is showing a debit balance of Rs.150000 when one of the partners died on
January 31, 2004. In order to see that the business of the firm does not suffer, the bank allowed the operations in the account by the surviving
partners who deposited Rs.60000 and withdrew Rs.35000 through various transactions when the legal heir approached them for settlement of
the account. What is the extent of liability of the legal heirs ?
a Rs.150000 b Rs.125000; c Rs. 115000 d Rs.90000
106: An attachment order of Rs.80000 on a partnership firm is received, whose current account shows a balance of Rs.8000. The individual
accounts of the partners A, B and C are showing credit balance of Rs.40000, Rs.34000 and Rs.2500 respectively. To meet the payment stated
in the order, how much amount will be payable from A's account ?
a Rs.32500 b Rs.35500 c Rs.37500; d Rs.40000 e Rs.39500
107 Mr. Vakil Singh, a solicitor, has two current accounts with a bank branch, one a client account and the other, his office account. A
cheque from his client account is presented in clearing and simultaneously a court order is received in his name for attaching balance in his
accounts. What should bank branch do?-
a cheque cannot be paid; b balance in both the accounts will be attached; cbalance in office account only will be attached and
cheque will be paid; d cheque will be paid as it is a solicitor's account cheque can be paid from any account
108 Your branch receives a garnishee order in the name of your customer Mr. Trivedi, who has the following deposits accounts with
your branch. Which of these can be attached under this garnishee order:
a Trivedi — Executor of Ashok Kumar deceased; b Joint saving bank account with his wife,c Trivedi - Trustee of Sewa Dal
Charitable Trust; d all the above; e) none of the above
109 Mr. Suresh, payee of an order cheque of Rs.15000 issued by a current account customer of Model Bank presents the cheque for payment.
He is issued a token and the cheque is also passed. Suddenly he receives a call on him mobile phone and rushes outside the bank and does not
turn up that day. He visits the branch, the next day and explains the circumstances, after which, the bank agrees to make the payment.
Meanwhile the bank receives a garnishee order and expresses its inability to make the payment. Mr. Suresh pleads that the payment has
already been cleared by the bank, the previous day:
a the refusal of the bank is not justified as the payment has been affected (made) on the previous day
b the cheque has already been debited and money kept separately, due to which the garnishee order is not applicable
c the funds are still with the bank due to which the funds in the cheque will be attached under the garnishee order
d the funds are kept by the bank as trustee of the payee due to which the garnishee order is not applicable a and d
110 Hari and Mohan are maintaining a joint saving bank account and bank receives garnishee order in Hari's name where the balance in the
account is Rs. 10000.
a The order will be applicable to the share of Had which is 50%; b The order will be applicable to the whole of the amount. cThe order
will not be applicable at all, in joint account as account is not in the same name and capacity.
d withy receipt of order, operations would be stopped; None of the above.
111 A customer of a current account has deposited two cheques worth Rs.15000 which have been sent in clearing and have been credited, but the
time for returning of the clearing has yet not expired. Meanwhile an attachment order is received in the account:
a order will be applicable on the cheques on same day, when time for clearing returning is over and cheques are not dishonoured
b order will not be applicable on the cheques
c order will be applied after seeking confirmation from paying banker
d order will become applicable from next day if cheques have not been returned unpaid
e none of the above
112 A Garnishee order for Rs.12000 is received at 12.15 p.m. in the name of Shanti Prakash, a customer of your branch. You observe that
following accounts are there in the branch with which Mr.
Shanti Prakash is associated. In case of which of the these accounts, the order will apply ?
a a saving bank account jointly with his wife with either or survivor operations
b a fixed deposit in the name of his minor daughter under his guardianship
c Current account no. 234 with balance of Rs.2035 at 12.15 p.m.
d Deposit of cash by the depositor, Rs.15000 in current account no. 234 at 12.45 p.m. account in the name of a trust where
he is a trustee
113 Mr. Suresh receives a cheque of Rs. 500 as payee and endorses it in favour of Mr. Satish and he in turn endorses it to Mr. Sham
Lal which reads as 'pay to Mr. Sham Lal sans recourse'. Mr. Sham Lal endorses the cheque in favour of Mr. Shoaib Akhtar. When he
approaches the bank for obtaining payment, the cheque is dishonoured. Who is among the following is not liable on the cheque:
a Drawer and Mr. Suresh b Suresh and Mr. Sham Lal c Sham Lal and Drawer d Satish and Shoaib Akhtar;
e all the above
114 A saving bank customer Mr. Nishat issued a cheque of Rs.12000 in favour of Mr. Mohd. Musa to discharge his liablity. The
cheque was endorsed by Mohd Musa in favour of Mr. Ramzan from whom the cheque was stolen by Mr. Hussain. He forged the
endorsement of Mr. Ramzan and delivered it to Mr. Sharma, who encashed the cheque before the fact came to the notice of the
drawer and the report could be lodged with the bank for stop payment. The drawer now demands that bank should restore the
entry as bank' has acted negligently: a the bank has acted in good faith due to which it is not liable
b the bank has made the payment after ensuring the regularity of the endorsement due to which the bank is not liable and is
protected
c the bank has acted negligently due to which it is liable
d the bank and the drawer and the Mr. Ramzan, should share the loss the bank should recover the payment from Mr.
Sharma and compensate the drawer for the loss.
115 A draws a cheque in favour of his customer B, who endorses the cheque in favour of C. But another person D obtains the
payment by forging the signatures of C. The drawee bank makes the payment without verifying the endorsement. Later on C
contends that bank is liable for forged endorsement of D
a paying bank has acted negligently, hence liable; b paying bank should have asked for confirmation from the collecting bank
for all endorsements, c paying bank will not be held liable if the payment is otherwise in due course , d paying bank should verify
the genuineness of the endorsement c and d
116 Mr. Avinash has endorsed a cheque to Mr. Brij Bhushan. He has also used the words 'without recourse to me' in this
endorsement. Such an endorsement is called
a partial endorsement b facultative endorsement; c sans recourse endorsement
d endorsement in full e Restrictive endorsement
117 Had gets a cheque in his name from Harminder. Had endorses it to Harish but Harish misplaces it. Harry finds this cheque and
after forging Harish's endorsement delivers it to Hariharan. Hariharan takes for consideration and in good faith. What kind of right
Harish has got in the cheque:
a Holder in due course; b holder; c He can recover from Harry; d any of the above
118 Mr. Satya Narayan issues a cheque of Rs.10500 in favour of Mr. Shanker in discharge of his liability towards Mr. Shanker.
Shanker endorses the cheque in favour of Mr. Shambhu who misplaces the cheque. His assistant Mr. Shiva comes to possession of
the cheque and forges Mr. Shambhu's signatures and endorses the cheque in favour of Sham for value, who obtains payment
from bank, through clearing. From whom can Satya Narayan recover the money?
a Mr. Shambhu whose negligence has lead this loss to occur
b Mr. Shiva, who has forged the instrument
c Mr. Sham who has obtained the payment of a cheque, for which he was not a holder or holder in due course , d a and b
above, e all the above
119 Your customer Mr. Kishore issues a cheque of Rs.12500 in favour of Mr. Kishan who endorses the cheque in favour of Mr. Kiran
who misplaces the cheque. The cheque falls in the hands of Mr. Kanahiya who forges the endorsement of Mr. Kiran and obtains
payment from the bank. Mr. Kishore and Mr. Kiran request the bank to reverse the entry, as payment has been made on the basis of
a forged endorsement:
a bank is liable on the payment and will reverse the entry
b bank is liable on the payment but will refuse the reversal of the entry
c bank is not liable as the paying bank is protected against a forged endorsement
d any of the above; e none of the above
120 A bearer cheque of Rs.18000 is presented by the payee of the cheque Mr. Anurag aged about 17 for payment across the
counter, from the account of a public limited company maintaining account with your branch but the passing official refuses
to make the payment. The payee insists on either to pay or to give the reasons in writing for non-payment:
a the bearer cheque is issued by a company due to which it cannot be paid and bank should give the reasons in writing
b the bearer cheque cannot be paid but bank may or may not give the reasons in writing
c the minor is not competent to contract due to which the payment should not be made and facts may be given by the bank
in writing
d the minor can obtain the payment and give valid discharge. Bank can be held liable, if the payment is not made e none of
the above
ANSWER : TEST YOURSELF -1
1 D 2 A 3 C 4 A 5 A 6 B 7 B 8 B 9 A 10 B
11 D 12 D 13 A 14 A 15 D 16 A 17 B 18 D 19 D 20 B
21 D 22 D 23 B 24 B 25 B 26 A 27 D 28 D 29 B 30 A
31 B 32 A 33 A 34 A 35 D 36 D 37 D 38 D 39 B 40 D
41 C 42 A 43 C 44 B 45 D 46 A 47 D 48 C 49 A 50 C
51 C 52 D 53 C 54 C 55 C 56 B 57 D 58 D 59 D 60 A
61 D 62 A 63 B 64 C 65 D 66 B 67 A 68 A 69 C 70 C
71 E 72 A 73 D 74 B 75 C 76 C 77 C 78 B 79 B 80 C
81 C 82 D 83 B 84 A 85 C 86 D 87 B 88 B 89 C 90 C
91 A 92 B 93 C 94 D 95 B 96 C 97 B 98 B 99 A 100 C
101 A 102 C 103 D 104 C 105 D 106 B 107 C 108 E 109 C 110 C
111 A 112 C 113 D 114 B 115 C 116 C 117 B 118 C 119 C 120 D
** BEST OF LUCK **

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TEACH YOURSELF - JAIIB

ONE LINER APPROACH BOOK ON JAIIB -1

PRINCIPLES & PRACTICES OF BANKING

Sanjay Kumar Trivedy

Date: 08.11.2017 Sanjay Kumar Trivedy

2 MODULE : B ( FUNCTIONS OF BANKS ) 14-40

3 MODULE : C ( BANKING TECHNOLOGY ) 40-49

4 MODULE : D ( SUPPORT SERVICES ) 49-52

5 MEMORY BASED RECALLED QUESTIONS 53-57

6 TEST YOUR SELF : MODEL PRACTICE TEST PAPERS 58-65

2. MODULE B: FUNCTIONS OF BANKS

97. PEMGP Subsidy to be kept as: 3 Years FDR without Interest

3. MODULE-C: BANKING & TECHNOLOGY

BANKING & TECHNOLOGY

Computer & System

(Rs.in cr) Mar31'17 Sep15'17 Small Savings Interest Rates

PRACTICE TEST PAPER-1

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