P.

RAJENDRA PRASAD
½ããäœÊããè¹ã›á¶ã½ã - 521 002
ASST.GENERAL MANAGER ‡ãðŠÓ¥ãã ãä•ãÊãã - ‚ããâ£ãÆ ¹ãƪñÍã
Ô›ñ› ºãö‡ãŠ —ãã¶ãã•ãö㠇ãñŠ¶³ MASULIPATNAM - 521 002
STATE BANK LEARNING CENTRE KRISHNA DIST., A.P.
MASULIPATNAM Email: prajendra.prasad@sbi.co.in
Mobile no 9866502240

ªîÀ¼ããÓã Phone : (08672) 251564 (AGM) 251548 (OFFICE) û¹ãõŠ‡ã‹Ôã FAX : 08672-251564 †ñ ¹ããè I P : 903191 ƒÃ-½ãñÊã EMAIL: stc.mptm@sbi.co.in

Dt . 13.10.2010

Dear Friends,

SADHANA SERIES
TRAINEE OFFICER EXAMINATION 2010
MODEL TEST PAPERS FOR PRACTICE

I am happy to present one more effort by our faculty-model test papers prepared by them on
the examination pattern, which facilitates the aspirants to make some practice before taking on
the actual test. By writing these tests, the aspirant will be able to make time adjustments,
which is very essential to fare better on the dooms day and help them to take the examination
on 24th October 2010 confidently. In order to enable the aspirant to feel an examination
atmosphere, the key is not being given immediately. It is being uploaded separately in our
SBLC site on the next day.

Take the examination with confidence and give your valuable feedback either to the faculty who
prepared the test or to me so as to bring further improvements in the material.

With best wishes

P.RAJENDRA PRASAD
 STATE BANK LEARNING CENTRE, MASULIPATNAM
SADHANA SERIES (MODEL TEST PAPERS FOR TO-2010)
MODEL TEST PAPER - II
PREPARED BY - G.VENKATESWARA RAO, MANAGER (FACULTY)

MULTIPLE CHOICE QUESTIONS (BANKING AND FINANCE)

Please choose correct answer for the following questions from the given
alternatives.

1. Commodity exchange markets in India are regulated by [ ]

a) Commodities exchange Board b) Forward markets commission
c) Commodities Exchange Regula- d) Commodities Exchange Regulation
tion Commission. Board.
2. MCA-21 relates to [ ]
a) Mopping up of black money in the b) Prevention of malpractices by
country. companies.
c) Computerization of ROC/MCA d) Governing companies in a better
(Registrar of companies) dealings. way in the wake of Sathyam.
3. Bombay Stock Exchange (BSE) is situated at Mumbai. Where is the National [ ]
Stock Exchange (NSE)?
a) Kolkata b) New Delhi
c) Bangalore d) Mumbai
4. Stress Testing in financial parlance relate to [ ]
a) Finding out Bank’s strength to b) An advanced approach for asset
withstand various stresses liability management of financial
emanating from various risks. institutions.
c) Business strategy of banks by d) An approach for measuring stress
testing the stress in the economy. levels in bank employees.
5. Which of the following is taken for calculation of interest on Savings Bank [ ]
Accounts?
a) Daily closing balance b) Daily average balance
c) Minimum balance between 10th & d) Minimum Balance in a month
last day of the month
6. The headline inflation measure in Indian economy are based on [ ]
a) Year-on-year variation of WPI. b) Year-on-year variation of CPI.
c) Real time variation of WPI d) Real time variation of CPI.
7. The budgetary estimates of fiscal deficit and revenue deficit for 2010-11 are [ ]
a) 4% and 5% of GDP b) 4% and 5.5% of GDP
c) 5.5% and 4.5% of GDP d) 5.5% and 4% of GDP
8. India’s foreign exchange reserves as on March,2010 as per RBI’s estimates are [ ]
a) US$279 billion. b) US$270 billion
c) US$275 billion d) US$265 billion.
 9. M-3 money supply measurement in India takes into consideration [ ]
a) Post office SB savings b) Time deposits with banks
c) Interbank deposits d) All the above.
10. Who is the chairman of the high level task force constituted by Government of [ ]
India on credit flow to MSMEs (Micro, small and medium enterprises) and
recently submitted their report?
a) V.K.Sharma b) T.K.A.Nair
c) N.L.Sathe d) Smt.Usha Thorat.
11. 3G SPECTRUM relates to [ ]
a) New generation of cell phones b) Allotment of new and higher
bandwidths in cellular
communication.
c) New technology in cellular d) Multimedia cellular communication
communication. technology.
12. The managing director of IMF is [ ]
a) Percy Anderson b) Lileon Mathew
c) Dominique Strauss-Kahn d) Lely Cipora
13. The world’s largest economy in terms of Purchase Power Parity (PPP) is [ ]
a) China b) USA
c) Brazil d) Russia
14. The mascot of the current commonwealth games being held at Delhi is [ ]
a) Appu b) Shera
c) Royal Tiger d) Lion
15. The world Bank consists of [ ]
a) IBRD (International Bank for b) IBRD only and IDA is an
reconstruction and Development) independent and complementing
& IDA (International development agency.
Agency).
c) IDA only and IBRD is an d) None of the above is correct.
independent and complementing
agency.
16. World’s largest bank in terms of balance sheet size is [ ]
a) BNP Paribas b) Deutche Bank
c) HSBC Bank d) JP Morgan Chase.
17. Which round of GATT negotiations are yet to be concluded? [ ]
a) Uruguay round b) Tokyo round
c) Doha round d) Annecy round
18. Carbon credits are systematized following [ ]
a) Paris protocol b) Kyoto protocol
c) Manila protocol d) Washington protocol
19. The institution which looks after regulation of insurance sector in the country is [ ]
a) IRDA b) AMFI
c) ICDA d) SEBI
20. Which of the following institutions recently got full license to conduct general [ ]
insurance business in the country?
a) ICICI b) HDFC
c) SBI d) LIC
21. The tag line of which of the following banks is “world’s local bank” [ ]
a) HDFC b) ABN AMRO
c) HSBC d) CITY BANK
22. The recent controversy involving IRDA and SEBI is related to [ ]
a) Ban on ULIP investments by SEBI b) IRDA’s refusal to park ULIP funds in
the stock market.
c) IRDA’s refusal to give details of d) None of the above.
ULIP funds to SEBI.
23. FIFA-2010 world cup finals is played at [ ]
a) Cape Town b) Durban
c) Port Elizabeth d) Johannesburg
24. Who is awarded with the best player in FIFA-2010 world cup [ ]
a) Diego Forlan b) Thomas Muller
c) Wesley Sneijder d) David Villa
25. TATA Motors international acquisition is [ ]
a) Corus b) Arcelor
c) Jaguar d) None of the above.
26. “Bank of Rajastan” has been recently merged into [ ]
a) ICICI b) HDFC
c) Bank of India d) SBBJ
27. Which of the following summits is related to climate change? [ ]
a) Canberra summit b) Greenland summit
c) Copenhagen summit d) Venice summit
28. Which of the following oil company suffered huge financial loss on account of oil [ ]
spill?
a) British Petroleum b) Chevron
c) Shell d) Exxon Mobil
29. Monetary review will be taken up by RBI at [ ]
a) Half yearly intervals b) Annual policy
c) Quarterly intervals d) Bi-monthly intervals.
30. Finacle is a CBS software developed by [ ]
a) TCS b) Infosys
c) IBM India d) i-flex solutions
31. Recently which European country’s economic state sent shivers in the global [ ]
economy?
a) Germany b) Netherlands
c) Greece d) France
32. Technology up-gradation fund scheme (TUFS) promoted by Government of India [ ]
is applicable to
a) Textile & Jute Industry b) Sugar industry
c) Tea & coffee industry d) Food industry
33. “NASSCOM” is the [ ]
a) Indo-American venture for b) American outsourcing regulatory
collaboration in software. authority
c) Chamber of commerce of IT-BPO d) Chamber of commerce of IT-BPO
industries in India. industries in America.
34. The UID (Unique Identity) number given to all Indian citizens is also known as [ ]
a) Avathar b) Aadhaar
c) Adharan d) Hasth
35. While SBI is the highest advance tax payer for the FY 2009-2010, the second [ ]
position is occupied by
a) Bank of Baroda b) LIC of India
c) RIL (Reliance Industries Ltd) d) IOC (Indian oil Corporation)
36. Blue green algae is a [ ]
a) Toxic bacteria b) Infectious bacteria affecting crops
c) A bio fertilizer d) Found in seas affecting ship
movements in sea routes.
37. Lakshya is India’s [ ]
a) Self navigating missile b) Pilotless aircraft
c) Heat seeking missile d) Tank missile.
38. Recently the security council of United Nations imposed additional sanctions on [ ]
a) Libiya b) North Korea
c) Myanmur d) Iran
39. Viticulture refers to [ ]
a) Preparing honey b) Preparing wine from grapes.
c) Preparing olive oil d) Preparing narcotics.
40. DGFT is related to [ ]
a) Exports & imports form India b) Transportation in India.
c) Civil aviation in India d) Industrialization of the country.
41. Recently which country’s currency policy came under severe attack from USA [ ]
and European Union?
a) Russia b) India
c) Brazil d) China
42. The recently adapted Rupee symbol was designed by [ ]
a) D.Uday Kumar b) D.Dileep Kumar
c) D.Arun Selvam d) D.Rangarajan
43. 11th five year plan period is [ ]
a) 2007-2012 b) 2008-2013
c) 2006-2012 d) 2006-2011
44. RIDF is a scheme to be operationalized by [ ]
a) State Governments b) Ministry of Rural development
c) NABARD d) Nationalized Banks
45. A record production of food grains at 234.47 million tones was experienced by [ ]
India in which year?
a) 2008-2009 b) 2009-2010
c) 2007-2008 d) 2004-2005
46. The BSE SENSEX experiences volatility on account of [ ]
a) FDI Investment b) FII investment
c) MF Investment d) Foreign Banks participation
47. The cap on FDI in insurance sector presently is [ ]
a) 74% b) 49%
c) 26% d) 51%
48. The entities identified by PFRDA for floating their pension funds are [ ]
a) LIC,SBI & UTI-AMC b) LIC, SBI & UTI
c) SBI, BOB & AXIS Banks d) SBI, BOB & UTI
49. Swavalamban is related to [ ]
a) RIDF (Rural Infrastructure b) Health insurance programme
development fund) scheme launched for rural poor
c) Rural housing scheme. d) Government’s assistance to NPS
(New pension scheme)
50. According to 2001 census, the state with lowest literacy rate is [ ]
a) Bihar b) Rajastan
c) Madhya Pradesh d) Nagaland
51. The new direct tax code will come into force w.e.f [ ]
a) 31.03.2010 b) 31.03.2011
c) 01.04.2011 d) 31.03.2010
52. Corporate Tax rate as per DTC (Direct Tax Code) is [ ]
a) 20% b) 10%
c) 25% d) 30%
53. TALLY is a [ ]
a) Software for book keeping b) Software for balancing bank’s daily
transactions
c) Software for Bank’s balance d) None of the above.
sheets.
54. “Incredible India” is [ ]
a) A campaign for promoting India b) A campaign for promoting India as a
as a investment destination global tourist hot spot
c) A campaign launched for d) A campaign launched to promote
promoting SBI as a global bank. India as an exporter.
55. Contribution is [ ]
a) Sales – fixed cost b) Sales/variable cost
c) Sales – variable cost d) Sales/fixed cost.
56. Which of the following is not a credit rating agency ? [ ]
a) CAMELS b) ICRA
c) CRISIL d) CARE
57. MCX is a [ ]
a) Exchange for gold trading b) Commodities exchange
c) Forex exchange d) Metals exchange
58. ETF stands for [ ]
a) Exchange traded fund b) Electronic traded fund
c) Exchange traded future d) Electronic traded future
59. Which of the following are engaged in mutual funds? [ ]
a) Birla sunlife b) Kotak Mahindra
c) Reliance mutual fund d) All the above
60. One of the focus areas of Bharath Nirmaan programme is [ ]
a) Construction of rural dwellings b) Removal of poverty through
employment assurance programme
c) Rural & urban upliftment d) Literacy programme.
programme
61. Chairman of Federal reserve of USA is [ ]
a) Alen Greenspan b) Ben Bernanke
c) Steve Goldstein d) None of the above
62. Which head accounted for a major portion in the non-tax revenues of central [ ]
government during 2009-2010?
a) Other communication services b) Petroleum
c) Railway revenue d) Power
63. The most worrisome factor for Indian economy during 2009-2010 is [ ]
a) Double digit food inflation b) Fuel shortages
c) General hike in all prices d) Severe drought conditions
64. SEZ (Special economic Zone) is a [ ]
a) Improvement over EPZ concept b) Renamed EPZ concept.
c) Old form of EPZ concept. d) No relation between EPZ and SPZ
concept.
65. A debt repayment crisis occurred in 2010 and in which country? [ ]
a) Dubai b) China
c) Mexico d) India
66. Oligopoly refers to [ ]
a) Perfect competition b) Competition between few players
b) A pure form of monopoly d) None of the above
67. 360 degrees feedback is [ ]
a) Boss appraisal b) Subordinate appraisal
c) HR system d) None of the above
68. Factoring relates to [ ]
a) Bill finance b) Export finance
c) Receivable finance d) Infrastructure finance
69. Take out finance is best used for [ ]
a) Bill finance b) Real estate sector
c) Stock broker finance d) Infrastructure finance
70. Derivatives derive their value [ ]
a) From SWAPs b) Based on market prices
c) From the underlying security d) Future tradable proposition.
71. Call option refers to [ ]
a) The right of the investor to buy a b) The right of the investor to sell a
stock stock.
c) The obligation of the investor to d) The right of the investor both to buy
buy a stock and sell a stock.
72. Fannie Mae & Freddie Mac are [ ]
a) Collapsed housing Finance b) Cartoon characters
companies of USA
c) European merchant bankers d) Greek banks.
73. Reverse mortgage loans are introduced by banks [ ]
a) At the behest of RBI advice. b) To help out old age people.
c) Changing population profile. d) All the above
74. RBI advised Indian banks to adapt RBS (Risk Based Supervision) [ ]
a) To fall in line with BASEL-II b) To facilitate RFIA.
framework.
c) To quantify risk d) None of the above.
75. IFRS refers to [ ]
a) International financial b) International Financial Reporting
reconstruction system Standards
c) Internal Financial Regulation and d) Internal Financial reporting system
Supervision.
 MULTIPLE CHOICE QUESTIONS (SBI SPECIFIC)

1. As part of the scheme for SME POWER, pre approved car loan for promoters is [ ]
available to
a) All 8 variants b) Only for Power Pack variant.
c) Only for Power Pack and Power d) For all variants with minimum QAB
Premium variants. of Rs.1,00,000/- and above.
2. “Prayas” campaign is related to [ ]
a) Promotion of RINB b) Data Purification campaign
c) Promotion of CINB d) Promotion of eZtrade campaign
3. As per RBI directives, the time frame for resolution of ATM complaints is [ ]
a) To be acknowledged within 7 b) 12 days and a penalty of Rs.100/-
days and to be resolved within 12 per day thereafter.
days and a penalty of Rs.10/- per
day thereafter.
c) 21 days and a penalty of Rs.110/- d) To be resolved within 15 days and
per day thereafter. a penalty of Rs.100/- per day
thereafter.
4. The maximum loan amount that can be sanctioned under Xpress credit is [ ]
a) Rs.10 Lacs b) Rs.12 Lacs
c) Rs.20 Lacs d) Rs.15 Lacs
5. Which of the following statements is correct. [ ]
a) The redemption period in case of b) Transaction limit for mobile
mortgage is 3 years. banking for both funds transfer
and purchase of goods is
Rs.50,000/-
c) The due date of a bill dated 31st d) The intra day transaction limit for
January,2010 payable one month Vyapar facility of CINB is Rs.50.00
after and accepted on 7th Lacs.
th
Jan,2010 is 5 February,2010
6. Which of the following is not a BPR outfit? [ ]
a) RACPC b) RCPC
c) CCPC d) CPPC
7. A Business Correspondent (BC) can undertake [ ]
a) Collection and payment of small b) In case of closure of loan accounts,
value deposits and withdrawals the ceiling for cash deposit will be
not exceeding Rs.10,000/- in each Rs.20,000/-
case
c) None of the above d) Both the above
8. The growth envisaged for Net Profit in the Bank policy guidelines for 2010-2011 [ ]
a) 25% b) 37%
c) 30% d) 40%
9. A Limited Liability Partnership (LLP) is [ ]
a) Not distinct from it’s partners b) Not having any perpetual
succession like a company
c) A partner of the LLP can’t lend d) None of the above
money to the LLP
10. Under CMS, the customer can lodge ATM related complaint [ ]
a) With Branch through letter b) With Branch/Administrative Unit/
Corporate Center through a letter
or FAX only.
c) He can directly lodge the d) With the Branch/ Administrative
complaint in CMS itself. Unit/ Corporate Center through
various modes like letter, E Mail,
phone, SMS tec.
11. Banking ombudsman can’t reject complaints in case of [ ]
a) Customer approaching b) Complaints relating to non sanction
ombudsman after approaching of loans.
bank for genuine grievance
relating to deficiency of service
relating to deposit product.
c) Frivolous complaints in nature. d) Case pending in a court of law in
respect of settlement of a deposit.
12. Which of the following is not a feature of “Criti9”, the health insurance plan [ ]
launched by SBI Life Insurance?
a) It is an individual health plan b) It provides protection against 9
critical diseases
c) The minimum sum assured is d) Assured sum is payable in one
Rs.25,000/- lump sum subject to fulfillment of
conditions
13. Which of the following is not an element of KYC policy? [ ]
a) Monitoring of transactions b) Risk management
c) Customer acceptance policy d) Money laundering
14. What is the ceiling on the amount of remittance that can be received through [ ]
Western Union?
a) US$2,500 per remittance b) US$4,500 per remittance
c) US$ 5,000 per remittance d) US$ 7,500 per remittance
15. The PAT declared by SBI MF for the FY 2009-2010 (in Lacs) is [ ]
a) 7587.37 b) 6894.91
c) -2521.32 d) -2520.32
16. What is the insurance premium to be paid for covering KCC borrower under [ ]
PAIS and how much of the amount is borne by the bank?
a) Rs.18/- & Rs.12/- respectively b) Rs.15/- & Rs.10/- respectively
c) Rs.21/- & Rs.7/- respectively d) Rs.18/- & Rs.6/- respectively.
17. GAR-7 is [ ]
a) Government challan b) CBDT challan
c) CBEC challan d) Return related to capital adequacy
18. “Operation Sampark” is [ ]
a) Updating of borrower contact b) Updating of contact information of
information by Branches all customers
c) Updating of CIFs all borrowers d) Updating of borrower contact
information by RACPC/RASMECCs.
19. In case of application received by the Branch under RTI Act [ ]
a) Branch Manager is CPIO and b) Regional Manager is CAPIO and
Regional Manager is CAPIO General Manager (Net Work) is
CPIO
c) Branch Manager is CAPIO and d) Regional Manager is CPIO and
General Manager (Net Work) is General Manager(Net Work) is
CPIO Appellate authority
20. Under SCORING MODEL FOR TRACTOR FINANCE, the concessions in Interest [ ]
and Margin when the score is more than 70 are
a) 0.5% & 5% respectively b) 1% & 5% respectively
c) 1.5% & 4% respectively d) 2% & 5% respectively.
21. All dormant and inoperative accounts are normally classified as [ ]
a) High risk accounts b) Low risk accounts
c) Medium risk accounts d) No risk accounts
22. In reverse mortgage loan [ ]
a) Hypothecation of property is b) Mortgage of property is involved.
involved
c) Negative loan is obtained d) Legal heirs undertaking is obtained
in respect of property
23. Which of the following is not true regarding cheque collection? [ ]
a) Immediate credit of outstation b) In case of collections between SBI
cheques up to & inclusive of branches in Metro centers, the
Rs.30,000/- can be afforded for time frame stipulated is 7 days.
satisfactorily conducted accounts.
c) The normal collection time frame d) Any delay in realization of cheques
between SBI branches located at beyond 45 days is treated as
places other than Metro centers abnormal delay.
and Area-I is 10 days
24. Under CGTMSE scheme the maximum amount of cover available is [ ]
a) Rs.62.50 lacs b) 75% of the amount in default up
to credit limit of Rs.100.00 Lacs
c) Rs.67.50 Lacs d) Rs.67.50 Lacs or 75% of the
amount in default whichever is
lower
25. SBI SURAKSHIT HOME LOAN is [ ]
a) Home loan with house fully b) Home loan with life cover.
insured
c) Home loan with abundant d) Home loan against liquid securities
collateral coverage
26. Which of the following is true? [ ]
a) FFRs are means to assess the b) CMA is adapted for all advances
physical health of a advance. above Rs.10.00 Crores only
c) DSCR is a liquidity measure d) Corporate loan can be sanctioned
to improve the liquidity of a unit
27. SME-11 document is obtained as per [ ]
a) Transfer of property act b) Contract Act
c) Law of limitation d) Easements Act
28. Which of the following is not true? [ ]
a) RBI has recently came out with b) Branch Managers certify clause-30
CTS-2010 to improve the back in respect of genuineness of
office part of currency charges incurred at the Branch.
management.
c) System will identify at random the d) PPKs are used to enable users in
SWO’s cash box to be checked CINB.
under the IBCH process.
29. Banker’s Lien [ ]
a) Require a separate agreement b) Is a specific lien
c) can be extended to deposits. d) Over the security is not time
barred by the law of limitation.
30. Which of the following is not a feature of FRTD? [ ]
a) Only retail P segment customers b) Premature closures are permitted.
can avail the product.
c) Period of deposit is 1 year, 3 d) There is no cap on the maximum
years and 5 years. differential paid between fixed
rates and floating rates.
31. Consumption credit in KCC is calculated on the basis of [ ]
a) Crop production limit b) Total limit sanctioned
c) On total production needs d) On allied production needs
32. Working capital gap is [ ]
a) Long term sources – long term b) Current Assets – Current Liabilities
uses other than bank borrowings
c) Current assets- current liabilities d) Net working capital
33. The RFIA scores for Branches not connected to any CPCs are given for [ ]
a) Credit Risk b) Operational Risk
c) Credit Risk, operational Risk d) Credit Risk, operational Risk and
Business figures.
34. The maximum amount of loan under SBI REALITY is [ ]
a) Rs.1.00 Crores b) Rs.2.00 Crores
c) Rs.5.00 Crores d) Rs.10.00 Crores
35. Risk Grade-2 refers to Bank’s loans and advances [ ]
a) Which are irregular beyond 30 b) Which are irregular beyond 60
days days
c) Which carry high risk of default d) Sub standard assets
36. “uberrimae fides” contracts are pertinent to [ ]
a) Banking sector b) Capital markets
c) Insurance sector d) Mutual funds sector
37. As per RBI guidelines, collateral security can not be insisted by Banks for all [ ]
advances
a) All advances to priority sector up b) All advances up to Rs.10.00 Lacs to
to Rs.10.00 Lacs MSE sector as defined by MSMED
Act.
c) All advances up to Rs.10.00 Lacs d) All the above.
to SSI and SBF.
38. Once a bearer always a bearer under section 85(2) of NI Act is applicable to [ ]
a) Cheques b) Cheques, drafts, bills of exchange.
c) Cheques and bills of exchange d) Bills of exchange only.
39. Which of the following should be reported s fraud? [ ]
a) Cash shortages of more than b) Cash shortages of more than
Rs.10,000/- Rs.5,000/, if detected by
Management/auditor/inspecting
official and not reported by the
person handling cash on that day
c) None of the above d) Both the above
40. “ASBA” stands for [ ]
a) Application supported by blocked b) Application in shares by blocked
amount amount
c) Addition of shares by blocked d) Addition supported by blocked
amount amount
 RATIONALS

ANSWER ALL THE 10 QUESTIONS. (10x 2 marks = 20 marks)

01. Our Bank has recently revised instructions in respect of inoperative / dormant accounts.
02. Credibility in meeting sales and profitability projections is very important for high value
SME borrowers.

03. SBI is on expansion spree.

04. Mercury FX has been introduced by SBI.
05. Bank has introduced HRMS.
06. Assignment of insurance policy is done on the policy itself.
07. Scoring models for various P segment loans are introduced.
08. Debit confirmation can substitute Revival Letter.
09. A cheque crossed “Not Negotiable” can be transferred by endorsement and delivery.
10. Interest is not applied on Recalled Assets account.

FOR & AGAINST

Answer all the questions below. (10 x 2 marks = 20 marks)

01. Interest on daily product basis in respect of SB accounts is well justified move of RBI.

02. BPR of SBI is process centric but not customer centric.

03. Many of our Rural branches are depending excessively on SHG finance for increasing their
business which is not a healthy sign.

04. The emoluments paid to the heads of public sector banks doesn’t commensurate with
those paid to the CEOs of private banks. Hence the emoluments of chiefs of PSBs are to
be enhanced.

05. Cross selling should be encouraged.

06. ATM CMS is a panacea for addressing customer dissatisfaction.

07. KYC norms are highly restrictive for business promotion.

08. Of late various courts are expressing the view that Section: 138 of NI Act is not a means
for recovery of loans and advances sanctioned by banks by obtaining post dated cheques?

09. FEMA act to be scrapped and Rupee to be fully floated to improve Rupee’s globally
efficiency.

10. Banks are supposed to create awareness among their customers about the e-governance
laws.
 SITUATIONAL ANALYSIS / CASE STUDY

Answer any 5 questions out of the 8 case studies given. (5 x 3 marks = 15 marks)
01. Guarantee of A and B was obtained for a cash credit limit of Rs.2.50 lakhs. “A” is a school
teacher with little means and about to retire and “B” is a rich man with abundant means.
The account went bad. “A” pleaded for exemption from legal proceedings in view of his
poor state of affairs and “B” served a letter that exoneration of “A” will exempt him as
well from the legal proceedings. How do you proceed?
02. A locker is in the name of Mr.A and Mr.B with mode of operation “E or S”. On one day
Mr.A rushed to the Branch and gave a letter that the locker key is misplaced and request
the Branch to exercise caution in this regard. After 2 hours, Mr.B came to the Branch and
informed that the locker key was found and demanded access to the locker. What would
you do?
03. Mr.”N” is maintaining a SB account at your branch. A cheque dated 31st March,2009 for
Rs.6,500/- drawn by him was paid by you on 05th April,2009. subsequently after updating
his passbook he approached the BM with the objection that the cheque was drawn for
Rs.500/- by him but not for Rs.6,500/-. When the cheque was examined under ultraviolet
lamp, it transpired that the cheque was chemically altered and Mr.”N” alleges negligence
on the part of the Bank. How would you deal with the situation?
04. You are accountant at a Branch. A staff member from a neighboring Branch rushed to you
with a request to issue duplicate Demand Draft for Rs.40,000/- which he urgently requires
in respect of property transaction. He stated that the original draft was misplaced and
gave a letter to that extent. He was telling that he would be giving the indemnity later on.
How would you deal with the situation?
05. Your Branch has taken over an advance from some another bank. In their opinion report
on IBA standard format, the other bank has ascribed satisfactory status to the account.
After taking over the account, the account became NPA immediately and on enquiry it
became evident that the status of the account is NPA with the other Bank from whom it
was taken over. What you propose to do?
06. An L/C was opened by you for “XYZ Company” who is engaged in importing machine tools
from “Clark & Company” located in Santiago. The L/C opened by us was confirmed by
Chase Manhattan Bank located at that place. XYZ Company approached you for a major
amendment in the terms of L/C. would you do it?
07. Mr.Mahindra came for a Housing Loan. He is a Government official aged 35 years and put
in 10 years of service and a respectful person with a good track record with us. However
he previously availed a housing loan with monthly repayment of Rs.4,500/- per month as
against the Net Monthly Income of Rs.27,500/- which is inclusive of notional rent of
Rs.2,000/- on that house. When you calculated the installment on the proposed new
housing loan, it came around Rs.14,700/-. How would you arrive at the EMI/NMI ratio in
the given scenario?
08. Mr.Sandeep is a Hindu residing at Chennai and very recently passed away at an age of 47
years. He is survived by two sons, daughter, wife, father and mother. Incidentally his wife
and three children are staying at a far off place in Gujarat. Mr.Sandeep is having Rs.1.50
Lacs in his SB account maintained with our Branch. On one day his father came to you
and enquired whether the amount can be discharged to him based on letter of disclaimer
by all the remaining legal heirs. How would you advise him?