Most Frequently Asked Questions in Various Bank Exams

Sakshi Education

When the objective is to follow the best practices to conduct the affairs of a company or bank in a transparent manner for giving fair deal to all the stake holders, this is called:
a. Implementation of Prudential Guidelines
b. Organizational Restructuring
c. Corporate Governance
d. Corporate Restructuring
e. Autonomy
A banking system under which the banks are to raise low cost funds and invest such funds in low risk assets such as govt. securities, is known as:
a. Narrow Banking
b. Universal Banking
c. Rural Banking
d. Risk Management Banking
e. Asset Liability Management Banking
When Reserve Bank injects liquidity in the monetary economy of the country, this is done through which of the following mechanisms?
a. Increase in CRR
b. Repo
c. Increase in SLR
d. Change in Bank Rate
e. Liquidity Adjustment Facility
ESOP stands for:
a. Efficient Servicing OF Promises
b. Employees’ Service Option Projects
c. Employees Stock Option Plan
d. Effective System of Projects
Interest rate on a debt security (say Govt. bonds) which issuer pays to holder till maturity:
a. Interest
b. Yield
c. Floating rate
d. Coupon rate
Branches of banks distribute insurance products of other insurance companies to their customers as corporate agents. This practice is called:
a. Underwriting business
b. Bancassurance
c. Referral business
d. Any of the above
The temporary loans that are allowed by RBI to Govt. from time to time to meet the mismatch position are called:
a. Treasury Bills
b. Dated Securities
c. Ways and Means Advances
d. Adhoc Treasury Bills
Narrow money is the term in monetary aggregates which represented by:
a. M1
b. M2
c. M3
d. M4
In _________ banking, the banks offer all types of financial services to expand their business that include high risk products and medium risk products also:
a. Retail Banking
b. Universal Banking
c. Wholesale Banking
d. Narrow Banking
When an existing non-profit organisation is converted into a for-profit company, the process is called:
a. Dematerialization
b. Demutualization
c. Re-materialization
d. Re-mutualization
A _________ is a financial contract between two parties to exchange interest payments for a ‘notional principal’ amount on settlement date, for a specified period from start date to maturity date.
a. Interest Rate Swap
b. Forward rate agreement
c. Interest Rate Future
d. Foreign Exchange Forward
What is meant by the term reverse REPO out of the following:
a. Injecting liquidity by the Central Bank of a country through purchase of govt. securities
b. Absorption of liquidity from the market by sale of govt. securities
c. Balancing liquidity with a view to enhance economic growth rate
d. Improving the position of availability of the securities in the market
When an unlisted company issues fresh securities for the first time, it is called:
a. Initial Public Offering
b. Rights Issue
c. Follow-on Public Offering
d. Bonus Shares
Process of artificially increasing or decreasing prices of security is known as-
a. Insider trading
b. Circular trading
c. Price rigging
d. Any of the above
The term broad money is known as?
a. M1
b. M2
c. M3
d. M4
Note: Narrow money (M1) = currency with the public + demand deposits with banking system + other deposits with the RBI
Broad money (M3) = currency with the public + demand deposits with banking system + other deposits with the RBI + time deposits with the banking system
Gilt-edged market deals in?
a. Worn Currency Notes
b. Bullion and Gold
c. Govt. Securities
d. Corporate Bonds
e. All kinds of capital market securities
The securities that are purchased by banks with the intension to take advantage of price movement or interest movement are classified as?
a. Held till Maturity
b. Available for Sale
c. Held for Trading
d. Fluctuating Securities
What is the maturity period of treasury bills issued by Govt. of India?
a. 14 and 91 days
b. 91 and 182 days
c. 14 and 182 days
d. 91, 182 and 364 days
e. None of the above
Ways and means advances of the central Govt. are payable within a period of
a. 10 days
b. 18 days
c. 15days
d. 20 days
e. 14 days
The market for short term financial assets / instruments, that are closed substitutes of money is called
a. Money market
b. Capital market
c. Forex market
d. Financial market
Under ________, market the funds are transacted by banks on an overnight basis.
a. Money Market
b. Call Money Market
c. Notice Money Market
d. Term Money Market
As per the prudent limit fixed by RBI in respect of outstanding borrowing transactions in call and notice money for participating banks, the banks can borrow a maximum of ______________ on any day, during the fortnight.
a. 110% of their capital fund
b. 120% of their capital fund
c. 150% of their capital fund
d. 125% of their capital fund
The term Plastic Money relates to which of the following
a. Credit card
b. Prepaid phone card
c. Plastic sheet notes
d. Debit card
Which of the following statement regarding amount of certificate of deposit is correct
a. Minimum amount of 1 lakh and maximum amount of 1 crore
b. Minimum amount of 1 lakh and maximum amount of 5 lakh
c. Minimum amount of 1 lakh without any maximum but multiple should be of 2 lakhs
d. Minimum amount of 1 lakh without any maximum but multiple should be of 1 lakh
Note: certificate of deposits issued by banks can have a maturity period of 7 days to 12 months
What is the maximum ceiling on foreign direct investment (FDI) for investment in the equity of public sector banks in India?
a. 20
b. 26
c. 49
d. 51
e. 74
Note: FDI for investment in the equity of private banks in India is 74%.
Listed companies are required to disclose their quarterly financial results within __________ from close of the quarter.
a. 15 days
b. 30 days
c. 45 days
d. 60 days
Which of the following extension of abbreviation does not match?
a. BCSBI - Banking Codes and Standards Board of India
b. KYC - know Your Consumer
c. BFS - Board for Financial Supervision
d. BIFR – Board for Industrial and Financial Reconstruction
Banks are required to ensure that while preparing their annual branch expansion plan (ABEP), they should allocate at least ________ of the total number of branches proposed to be opened during a year in unbanked rural centers.
a. 20%
b. 25%
c. 33%
d. 40%
What is the Net Interest Income (NII)
a. Difference of interest earned on assets and non interest income
b. Difference of assets and liabilities
c. Difference of interest earned on interest and on assets and interest paid on liabilities
d. None of the above
When REPO rate is reduced by RBI, it leads to-
a. reduction of cost to borrowers on loans from banks
b. increase in cost of loans to borrowers from banks
c. reduction in cost of borrowing from RBI
d. increase in cost of borrowing b y banks from RBI
When RBI offers liquidity adjustment facility to banks, it results in?
a. improvement in the liquidity position of banks
b. increase in their capacity to lend
c. increase in their deposits
d. improvement in income of banks by more lending
i) a to d all
ii) a, b and c
iii) a , b and d
iv) b,c and d
Which of the following interest rates is fixed by RBI and not left to the discretion of the banks concerned?
a. Saving bank deposit
b. Export credit facilities
c. NRE deposit accounts
d. DRI advances
Statutory liquidity ratio is maintained by banks on which of the following
a. Demand and time deposit
b. Net demand and time deposits
c. Net demand and time liabilities
d. Demand and time liabilities
e. Demand and time liabilities and net worth of the bank
Following liability is not taken as part of time and demand liabilities for the purpose of CRR -
a. Fixed deposits
b. Saving bank deposits
c. Recurring deposits
d. Paid up capital
Which of the following is not included as part of SLR assets?
a. Cash in hand
b. Gold owned by bank
c. Investment in un encumbered approved govt. Securities
d. Investment in quoted shares
When RBI wants o reduce liquidity in the banking system,
a. it increases the CRR
b. it increases the MSF rate
c. it increases the repo rate
d. it increases the reverse repo rate
The policies of RBI to influence the quantity of money in circulation are called
a. Credit Policies
b. Monetary Policies
c. Fiscal Policies
d. Any of the above
What rate of interest allowed by RBI on CRR balances with effect from 01/04/2007?
a. Bank rate
b. No interest is allowed
c. Equal to saving bank rate
d. Equal to reverse repo rate
Which of the following organizations provide credit history of the borrowers?
a. CIBIL
b. SEBI
c. RBI
d. CCIL
Which of the following categories of loans can be priced by banks without reference to the base rate?
a. DRI loans
b. Loans to members of staff
c. Loans to banks depositors against their own deposit
d. All the above
Under NEFT once a request for transfer of funds is received from a customer, the remitter bank prepares SFMS which stands for
a. Standard Financial Monitoring System
b. Standard Financial Messaging System
c. Structured Financial Messaging System
d. Structured Financial Monitoring System
The setting up of ATM was recommended by which of the following committee?
a. Narasimham committee
b. Saraf committee
c. Rangarajan committee
d. Shere committee
Which of the following Act gives legal recognition to a electronic signature?
a. NI Act
b. Income Tax Act
c. Information Technology Act
d. Indian Evidence Act
Which among the following are not eligible for deposit insurance from DICGC?
a. Foreign banks
b. Regional rural banks
c. District central banks
d. Primary cooperative societies
e. None of the above
If PAN details are not provided, the TDS rate is?
a. 10% in all cases
b. 20% 1in cases
c. 20% in all cases with less than 20% TDS rate
d. 20% in those cases where the rate is 10%
For cases of detection of counterfeit notes of ___________, in a single transaction, FIPs should be lodged with the Nodal Police Station/Police Authorities as per jurisdiction
a. 5 or more pieces
b. 4 or more pieces
c. 3 or more pieces
d. 2 or more pieces
A current account cannot be opened in the name of:
a. An illiterate person
b. A pardanashin woman
c. A physically handicapped person
d. All the above
e. None of the above
Out of the following, which document Cannot be taken for the purpose of customer identity:
a. Ration Card
b. Passport
c. PAN Card
d. Driving license in his name
The facility of nomination is permitted in accounts of individuals to facilitate the payment on death of the customer. These provisions contain in:
a. Section 45 ZA to ZC of RBI Act
b. Sec 45 ZA to ZF of Banking Regulation Act
c. Sec 45 ZC to ZF of Banking Regulation Act
d. Section 45 of RBI Act
e. Section 45 Y of Banking Regulation Acts
Which of the following is an important feature of small deposit accounts?
a. Where the maximum balance shall not exceed Rs. 50000
b. Total of credit entries in the account would not exceed Rs.1 lakh during an year
c. Monthly withdrawal is not more than Rs. 10000
d. a to c all
e. a and b all