Deck 2: Banking and Financial Laws in India

Question 1

The Reserve Bank of India was originally constituted as a share holder's Bank with a share capital of --

A)rs.50 lakh
B)rs.100 lakh
C)rs.10 crores
D)rs.5 crores

Answer 1

rs.5 crores

Question 2

Infrastructure Development Finance Company was established in -

A)1961
B)1997
C)1994
D)1991

Answer 2

1997

Question 3

Nationalised Banks have been permitted to offer their equity shares to the public to the extent of 49% of their capital as per amendments made in 1994 in

A)banking regulation act, 1949
B)banking companies (acquisition & transfer of undertakings) acts 1970/1980
C)both in (i) a
D)(ii)

Answer 3

banking companies (acquisition & transfer of undertakings) acts 1970/1980

Question 4

EXIM Bank is owned by -

A)govt, of india and rbi jointly
B)rbi and select commercial banks jointly
C)fully own
D)by govt, of india

Question 5

Contribution towards Rural Infrastructure Development Fund is made by

A)nabard and commercial banks jointly
B)state govts.and govt, of india
C)only those commercial banks who fail to achieve the stipulat
D)benchmark of agricultural advances and / or priority sector advances

Question 6

Credit rationing is a…………method of credit control.

A)quantitative credit control
B)qualitative credit control
C)direct credit control
D)continuous credit control

Question 7

The development programme began in our country with the launch of

A)community development programme
B)integrated rural development programme
C)small farmers development agency
D)intensive agriculture area programme

Question 8

"Sans recourse" means ____.

A)i am not afraid
B)do not touch me
C)ask the drawer
D)without liability to me

Question 9

When a drawer draws a cheque without keeping sufficient balance and if the cheque is bounced for insufficient funds.The drawer is punishable with imprisonment which may extend to and or a fine.

A)two months
B)one year
C)four months
D)six months

Question 10

The highest credit risk rating that can be awarded to any company by CRISIL is…..

A)++a
B)aaa
C)+aa
D)none of the above

Question 11

Bankers, in general, are hesitant to finance HUF because .

A)the firms ceases to exist when the karta is dead.
B)the firm ceases to exist with the death of any of the male coparcener.
C)the liability of the firm to the banker is susceptible to change with the birth of male chi
D)or with the death of a male coparcener in the huf.

Question 12

Factoring means .

A)financing against bills receivables.
B)financing invoices without recourse only.
C)purchasing and/or administering the receivables of a concern.
D)collecting the receivables and remitting to the seller.

Question 13

Under law of limitation , the liability of a guarantor is .

A)3 years form the date of document.
B)3 years from the date of default of the advance.
C)3 years from the date when the dema
D)is made on guarantor.

Question 14

The first bank to be established in India was ________ ,

A)bank of bengal
B)bank of hindustan
C)allahab
D)bank

Question 15

Which type of securities are held by Reserve Bank of India before issuance of currency notes ?

A)gold coins and bullion
B)foreign securities
C)government of india's securities
D)all of these

Question 16

Quasi Negotiable Instrument is accepted like Negotiable Instrument because of

A)the force of law
B)the customs and practice
C)their character of negotiability
D)none of these

Question 17

Loan documents executed out of India must be presented for registration within……….of its arrival in India.

A)three months
B)four months
C)six months
D)twelve months

Question 18

Usance bills or promissory notes drawn out of India are required to be stamped by

A)first holder in india
B)any holder
C)any party
D)none of the above

Question 19

Command Area Development Programme relates to __________

A)desert development
B)hill area development
C)livestock development
D)irrigation development

Question 20

The minimum percentage of Priority Sector advances to be maintained by foreign banks in India is .

A)40%
B)22%
C)32%
D)18%

Question 21

Margin money scheme of KVIC is applicable to the project of individuals and entrepreneurs ______________ .

A)where the total project cost does not exceed rs.10 lakh
B)where the total project cost does not exceed rs.25 lakh
C)where the total project cost does not exce

Question 22

"Customer" is defined in -

A)banking regulation act
B)n.i.act
C)r.b.i.act
D)nowhere it is defined

Question 23

Prospectus is issued by a Private Limited Company when it issues

A)debentures
B)shares
C)both debentures a
D)shares.

Question 24

A Public Limited Company should have minimum membership of -

A)50
B)15
C)7
D)no limit

Question 25

Introduction of rating methodology for banks was introduced by RBI on the lines of-

A)camel
B)ir
C)cma
D)none of these