Professional Documents
Culture Documents
Bank Management MCQ
Bank Management MCQ
d) All of above
Ans: D
2. KYC means
c) Both of above
d) None of above
Ans: A
a) Indian citizen
b) Non-Resident Indian
c) Illiterate
d) All of above
Ans: D
4. PAN means
d) None of above
Ans: C
5. E or S means
c) Either or Survivor
d) None of above
Ans: C
a) Issued by Bank
d) All of above
Ans: D
a) Not be cancelled
b) Be cancelled
c) Not be changed
d) None of above
Ans: B
8. Payment of cheque can be stopped by
a) Beneficiary
b) Nominee
c) Drawer of cheque
d) All of above
Ans: C
d) All transactions
Ans: A
a) Rs.100 crore
b) No limit
c) Rs.1 crore
d) None of above
Ans: B
d) All of above
Ans: D
is
a) 5 years
b) 7 years
c) 8 years
d) 10 years
Ans: D
13. What kinds of services are available free in ‘Basic Savings Bank Deposit Account’?
c) 4 withdrawals in a month
d) All of above
Ans: D
a) Current account
b) Savings Account
c) Fixed Deposits
d) None of above
Ans: C
15. In case of banking company incorporated outside India, aggregate value of its paid-up capital
and reserve shall not be less than Rs. __________.
a) 3 Lakhs
b) 12 Lakhs
c) 15 Lakhs
d) 18 Lakhs
Ans: C
16. In case of an Indian banking company, the sum of its paid-up capital and reserves if it has
places of business in more than one State shall not be less than
a) 5 Lakhs
b) 12 Lakhs
c) 35 Lakhs
d) 18 Lakhs
Ans: A
a) Post-dated cheque
b) Blank cheque
c) Crossed cheque
Ans: A
a) Demand
b) Usage
Ans: A
19. The reasonable period allowed in India for the presentation of a cheque is
a) 1 year
b) 3 months
c) 9 months
Ans: B
20. Which of the following are not the Negotiable Instruments as defined by the Statute…
a) Banker’s Note
b) Bill of Exchange
c) Cheques
Ans: A
21. Bank rate is the rate at which the Reserve Bank of India provides loans to
b) Commercial banks
Ans : B
22. When the supply for money increases and the demand for money reduces, there will be
Ans: B
Ans: C
24. The cost of bank credit is determined on the basis of base rate and all bank loans are given at
a rate equal to or higher than the base rate. Of the following, who determines this base rate?
Ans: D
25. Consider the following statements regarding relation between marginal cost and average cost
of lending, which one of the following statements is correct?
b) For the first borrowing, average cost of lending and marginal cost of lending are equal.
Ans: B
26. When the Reserve Bank of India announces an increase in the cash reserve ratio, what does it
mean?
Ans: A
27. Which one of the following is not an instrument of selective credit control in India?
b) Rationing of credit
c) Margin requirement
d) Reserve ratios
Ans: D
28. Which agency has the foremost role in regulation of banking sector in India?
Ans: A
29. Which of the following guidelines by the RBI does not hamper the profitability of commercial
banks in India?
c) Margin requirements
d) Bank rate
Ans: D
30. The banks are required to maintain a certain ratio between their liquid assets and total deposits.
This ratio is called
Ans: B
d) Commercial banks start borrowing more money from the Reserve Bank of India
Ans: B
a) April-March
b) July-June
c) October-September
d) January-December
Ans: B
33. Lending to which of the following sectors is not a part of priority sector lending?
a) Small-scale industry
Ans: D
34. To finance its deficit, the government prefers borrowing from the public over the RBI. What
can be the best reason for this?
b) The government has to return the sum to the RBI within a fixed period of time
c) Public borrowing does not affect the money supply in the market
Ans: C
35. Which of the following situations occurs during the period when borrowers and lenders expect
inflation?
Ans: A
36. What is “monetary base”?
c) The currency with public and deposits maintained by the commercial banks with the Reserve
Bank of India
Ans: C
Ans: A
a) Currency in circulation
Ans: D
Ans: D
40. Which of the following is/are the possible effects of introducing fresh currency?
a) 1 only
b) 1 and 2 only
c) 2 only
d) 1, 2, and 3
Ans: B
Ans: A
Ans: B
43.Those banking services based on the voice processing facility available with the bank
computers
(a) Internet banking
(b) Home banking
(c) E banking
(d) Tele banking
Ans: D
44. Which type of bank assets remained as NPA for a period exceeding 12 months
(a) standard assets
(b)Sub-standard assets
(c) Consortium banking
(d) None of these
Ans: B
45. Under which banking aims at targeting customers with large value transaction
(a) Whole sale banking
(b) Merchant banking
(c) Retail banking
(d) Internet banking
Ans: A
46. State Bank of India started merchant banking in ______ followed by ICICI in ______.
a. 1972, 1974
b. 1978, 1980
c. 1973, 1974
d. 1980, 1981
Ans: C
47. In India, merchant Banks operate in the form of divisions of India and foreign banks and
financial institution, Subsidiary companies established by
1. SBI Capital Markets Ltd.
2. Can Bank Financial Services Ltd.
3. PNB Capital Services Ltd.
4. BOI Finance Ltd.
5. Indian Bank Merchant Banking Services Ltd.
a. 1, 2, 4, 5
b. 2, 3, 4, 5
c. 1, 2, 3, 4, 5
d. 1, 3, 4, 5
Ans: C
Ans: A
49. The ______ is the apex organization in the Indian money market.
a. SBI
b. RBI
c. ICICI
d. IDBI
Ans: A
50. The first bank to set up a separate merchant banking division in India.
(a) Punjab national bank
(b) Standard charted bank
(c) National & Grin days bank
(d) National city bank.
Ans: C
Ans: D
Ans: D
53. Which is the Agency Function of Commercial Banks?
(a) Advancing Loans
(b) Accepting Deposits
(c) Act as Trustee
(d) Locker Facility
Ans: C
Ans: A
Ans: B
56. -------- crossing is not recognized by law, but only by banking custom
a. Account payee crossing
b. Double crossing
c. Special crossing
d. Not negotiable crossing
Ans: A
57. ------ is an endorsement made by an authorized person on behalf of another
a. Pre pro endorsement
b. Facultative endorsement
c. Partial endorsement
d. None of these
Ans: A
58. In the case of ----cheque, the payee need not be named and it can be transferred by mere
delivery.
a. Bearer cheque
b. Order cheque
c. stale cheque
d. None of these.
Ans: A
59. A cheque which bears a date which has already elapsed is called-----
a. Post-dated cheque
b. Ante-dated cheque
c. Mutilated cheque
d. None of these.
Ans: B
Ans: D
Banking system overview
61) ____________ allocates saving efficiently in an economy to ultimate users either for
investment in real assets or for consumption.
a) Economic system
b) Banking system
c) financial system
d) Market system
Ans: C
62) Which of the following is not a regulatory institution in Indian financial system?
a) RBI
b) CIBIL
c) SEBI
d) IRDA
Ans: B
a) SEBI
b) RBI
c) Finance Ministry
d) BSE
Ans: B
a) HDFC
b) HSBC
c) RBI
d) HUDCO
Ans: C
a) financial organization
b) financial intermediaries
c) financial system
Ans: B
a) IDBI
b) ICICI
c) IFCI
d) RBI
Ans: C
a) 1948
b) 1954
c) 1992
d) 1964
Ans: D
68) ______________is an apex institution to coordinate, supplement and integrate the activities of
all existing specialized financial institutions.
a) IFCI
b) IDBI
c) RBI
d) SEBI
Ans: B
a) Bills of Exchange
Ans: B
a) NABARD--------Industrial Loan
c) RRB---------------Agriculture Finance
Ans: C
a) Nationalized Banks
c) Cooperative Banks
d) Chits and Money lenders
Ans: D
a) 1949
b) 1955
c) 1959
d) 1969
Ans: A
73) When did the National Bank of Agriculture and Rural Development establish?
a) July, 1982
b) July, 1969
c) June, 1951
d) June, 1961
Ans: A
74) Which of the following is the apex institution which handles refinance for agriculture and rural
development in India?
a) RBI
b) SIDBI
c) NABARD
d) RBI
Ans: C
75) At which of the following cities is the Head Office of Reserve Bank of India located?
a) Mumbai
b) New Delhi
c) Kolkata
d) Dehradun
Ans: A
d) Included in the Second schedule to the Reserve Bank of India Act 1934
Ans: D
a) Bank of India
b) Axis Bank
d) HDFC
Ans: C
a) 1912
b) 1949
c) 1935
d) 1913
Ans: A
79) With whom does the ownership of Public sector banks rest?
a) Government of India
Ans: A
a) 1937
b) 1935
c) 1934
d) 1949
Ans: B
a) Balance sheet
b) P&L Account
c) Trading account
Ans: D
Ans: D
Ans: C
84. Which of the following shows the actual financial position of an enterprise?
Ans: B
85. A firm buys products but does not pay to suppliers instantly. This is recorded as
A) Account Receivable
B) Account Payable
C) Accumulated Liabilities
D) Current Liabilities
Ans: B
86. Financial securities which can be changed into cash to their book value price are categorized
as
A) Short-term Investments
B) Inventories
C) Long-term Investments
D) Cash Equivalents
Ans: D
87. On balance sheet, accruals, notes payable, and account payable are listed under which
category?
A) Current Liabilities
B) Accumulated Liabilities
C) Noncurrent Liabilities
D) Accrued Liabilities
Ans: A
88. Earnings that have a cumulative amount and are not paid to the stockholder as a dividend is
known as
A) Common Earnings
B) Preferred Earnings
C) Non-paid Earnings
D) Retained Earnings
Ans: D
89. Information that is used by investors for expecting future earnings is recorded in
A) Annual Report
D) Stock Report
Ans: A
90. Equity ₹ 90,000 Liabilities ₹ 60,000 Profit of the year ₹ 20,000. Then total assets will be :
(a) ₹ 1.70,000
(b) ₹ 1,50,000
(c) ₹1,10,000
(d) ₹ 80,000
Ans: A
91. The reserve which is created for a particular (specific) purpose and which is a charge against
revenue is called:
Ans: D
92. The profit and loss disclosed by the accounts of a company is:
Ans: C
13. Balance Sheet is a:
(a) Account
(b) Statement
Ans: B
94. Preliminary expenses are shown in the Balance Sheet under the head:
Ans: D
Ans: C
a) Non repayable
c) Repayable on demand
d) None of these
Ans: C
a) Rate at which RBI allows temporary loan facilities to commercial banks against government
securities only on the condition that the bank will repurchase the securities within a short period.
c) When any bank has excess cash, securities are bought from RBI against cash with the condition
that they will resell the securities to RBI on a pre fixed day and price.
d) When a bank is in need of cash it can discount bills of exchange and avail loan facilities from
Reserve Bank of India.
Ans: A
98. Which is the first commercial bank incorporated by the Indians in 1881?
Ans: B
99. By performing open market operation transactions, RBI regulates which of these factors
b) Inflation
d) Both B & C
Ans: D
100. When RBI increases the cash reserve ratio (CRR), it will
Ans: A
a) Private Bank
b) Public Bank
c) Foreign Bank
d) None of these
Ans: B
a) Industrial sector
b) Service sector
c) Manufacturing sector
d) None of these
Ans: B
a) Whenever the government declares a debt relief, the RBI will have to bear the brunt of it.
b) If a person or firm which is eligible to get a loan, does not get it from any commercial bank,
may approach the Reserve Bank of India for a loan.
c) If the state governments are in crisis and need money for short term , they can approach RBI for
this purpose
d) If a commercial bank is in crisis, it may place its reasonable demand for accommodation to
Reserve Bank of India
Ans: D
104. The most widely used tool of monetary policy is known as?
b) Discount rate
c) Issuing of notes
d) None of these
Ans: A
Ans: D
d) All of these
Ans: D
107. Who can open bank account?
a) Indian citizen
b) Non-Resident Indian
c) Illiterate
d) All of above.
Ans: D
d) All transactions
Ans: C
d) None of above.
Ans: C
a) Rs.100 crore
b) No limit
c) Rs.1 crore
d) None of above.
Ans: B
d) All of above.
Ans: D
(A) Overdraft is always subject to limit whereas cash credit has no limit.
(B) Overdraft is allowed on any kinds of account whereas cash credit is allowed on current account.
(C) Overdraft is allowed on current account whereas cash credit is a separate account.
Ans: C
113. Lien, one of the modes of charging securities, is the right to retain:
Ans: A
114. When a manufacturer wants to borrow money on the security of raw materials or stock-in
process which are in the process of being manufactured into finished products, bank prefers:
Ans: B
(A) A charge against property for an amount of debt where neither ownership nor possession is
passed on to the creditor.
(B) The right to retain a particular commodity in respect of which the debt arose.
Ans: C
Ans: A
117. Will you give loan against a Fixed Deposit Receipt jointly held by two persons with the
instructions: payable to either or survivor?
(C) No, unless necessary documents are signed by both the persons names of whom are appearing
on the FDR.
Ans: C
Ans: A
119. While giving loans against security of shares, one of the points a bank ensures that:
(A) The shares are partly paid because these are safe
(B) The shares are fully paid but not quoted in stock exchange.
(C) The shares are fully paid and quoted in stock exchange.
Ans: C
(C) Yes, minor can borrow himself and bind himself with the bank.
Ans: B
Ans: A
Ans: A
Ans: B
(B) Ownership is not passed to the mortgagee but legal or equitable interest is transferred
Ans: B
126. How does base for provision calculated in respect of Classified Loan?
Ans: C
127. What is the percentage of provision kept for Doubtful Loans and Advances?
Ans: C
Ans: A
Ans: B
(A) Absolute
(B) Primary
(C) Conditional.
Ans: C
Hi-Tech Banking and E Payment System
131. banking refers to the use of technology and communication systems in delivering banking
products and services to customers.
A. Hi-tech banking
B. Virtual banking
C. PC
D. Home banking.
Ans: A
A. Credit card
B. Debit card
C. None of these
D. Both of these
Ans: D
A. Pay later
B. Pay now
C. Both of these
D. None of these
Ans: B
134. Which is the fastest possible money transfer system through banking channel
A. RTGS
B. EFT
C. ATM
D. None of these
Ans: A
A. RTGS
B. Internet banking
C. EFT
D. mobile banking
Ans: C
136. Those banking services based on the voice processing facility available with the bank
computers
A. Internet banking
B. Home banking
C. E banking
D. Tele banking
Ans: D
A. E purse
B. Debit card
C. AYM
D. Credit card
Ans: A
138. RTGS stands for _____
D. none
Ans: B
A. privacy
B. risk
C. freedom
D. none
Ans: B
A. Ture
B. False
C. all
D. none
Ans: B
A. True
B. False
C. all
D. none
Ans: B
A. True
B. False
C. all
D. none
Ans: A
D. None of these
Ans: B
Ans: D
145. Credit Information Bureau India Limited is India’s first credit rating agency which was
incorporated in the year……
A. 1988
B. 2000
C. 2005
D. 1995
Ans: B
Ans: A
147. ----- are norms for banks aimed at mitigating the risk and strengthening the capital structure
of the banks of member countries.
A. IRAC rules
B. BASEL norms
D. None of these
Ans: B
A. IDRBT
B. RBI
C. NPCI
D. IBA
Ans: C
Regulatory Environment in Banking
149. The Foreign Exchange Regulation Act was replaced by the ______ in India.
Ans: D
150.Which are the important factor/factors required to maintain a quality relationship with the
customer?
Ans: A
151. Which is the Act which provides legal framework for e-Governance in India
Ans: C
152.Which of the following section of Negotiable Instrument Act, 1881 describes about "Cheque"?
A. Section 4
B. Section 5
C. Section 7
D. Section 6
E. Section 8
Ans: D
153. Which of the following organization is penalized by RBI for violation of the Fair Practices
Code?
A. Bajaj Finance
B. Yes Bank
C. Bank of Baroda
D. Allahabad bank
E. None of these
Ans: A
B. Payable on conditional
Ans: C
155. Which of the following is not considered as "Negotiable Instrument" as per the Negotiable
A. Promissory note
B. Demand Drafts
C. Bills of exchange
D. Cheques
E. Currency notes
Ans: E
C. a and b
Ans: C
157. In terms of Section 24 of the Reserve Bank of India Act, 1934, the Reserve Bank of India
may
A.Rs. 500
B.Rs. 5000
C.Rs. 10000
D.Rs. 1000
E. None of these
Ans: C
158. Which of the following is the sole authority for issue of currency in India?
A. Government of India
Ans: B
Ans: A
C. Government of India
Ans: C
161. Which of the following instruments of credit control adopted by Reserve Bank of India does
commodities
Ans: A
Ans: A
163. Which of the following fall under the qualitative methods of credit control adopted by Reserve
Bank of India?
C. Moral Suasion
Ans: D
B. the rate at which commercial banks discount bills of exchange for their clients
bills of exchange other commercial paper are eligible for purchase under the Reserve
Ans: D
165. The monetary authority in India, viz Reserve Bank of India, is bound to maintain a reserve
against the notes issued, whatever may be the amount. This system is called as
Ans: B
166. Banks and other financial institutions in India are required to maintain a certain amount of
liquid assets like cash, precious metals and other short term securities as a reserve all the time
A. CRR
B. Fixed asset
C. SLR
D. PLR
E. None of these
Ans: C
167. The term 'Currency of India' refers to
B. bank notes issued by Reserve Bank of India viz, Rs. 2, Rs. 5, Rs. 10, Rs. 20, Rs. 50, Rs.
C. one-rupee notes and coins and bank notes issued by Reserve Bank of India
Ans: A
168. The rate of interest banks charge its main/major and prime customers is popularly called as
A. Risk Premium
C. Repo Rate
E. Cost of fund
Ans: B
not have a bank account. What is the maximum amount he can transfer?
(a) 65,000
(b) 50,000
(c) 49,000
(d) 45,000
Ans: B
170. The financial instrument issued by the bank for remitting money and which
cannot be dishonored is a:
(c) Cheque
Ans: A
Ans: A
172. National Electronic Funds Transfer is a nation-wide centralized payment system owned and
operated by the Reserve Bank of India (RBI) is known as
(a) NEFT
(b) RTGS
(c) NFT
(d) NIFT
Ans: A
(a)₹ 50,000
(b) ₹ 2,50,000
(c) ₹ 1,00,000
(d) ₹ 2,00,000
Ans: D
Ans: C
175.A fund transfer method through which money is sent in ‘real time’ basis without any delays
is known as….
(a) NEFT
(b) RTGS
(c) NFT
(d) NIFT
Ans: B
Ans: E
177. The most appropriate statement with reference to the electronic fund transfer through NEFT
is:
(a) The fund transfer in NEFT takes place on real time, without any waiting period.
(b) National Electronic Funds Transfer (NEFT) is a nation-wide centralised payment system
owned and operated by the Reserve Bank of India (RBI).
(c) The NEFT transfer takes place from one person to another.
Ans: B
178. IFSC or Indian Financial System Code is an alpha-numeric code that uniquely identifies a
bank-branch participating in the NEFT system. It’s a 11-digit code with the first 4 alpha characters
representing the bank, and the last 6 characters representing ……
(c) RBI
Ans: A
179. A payment instrument which is drawn by a bank branch instructing another bank branch to
pay the specified amount to the entity named in the draft is known as…….
(b) Cheque
Ans: A
Ans: D
(a) E-Banking services can be used by those bank customers who have been authorised for this.
(c) A bank customer may use either his own computer resource for conducting specified banking
transaction or may use computer resource available at the cyber cafe.
Ans: D
Ans: C
(a)Credit Risk
(b)Operational Risk
(c)Market Risk
(d)Liquidity Risk
(e)Account Risk
Ans: E
184. The risk that arises from the possibility of non-payment of loans by the borrowers is known
as-
(a)Credit Risks
(b)Market Risks
(c)Moral Hazard
(d)Business Risk
(e)Liquidity Risk
Ans: A
185._________ risk arises because of the fact that the financial system is one intricate and
connected network.
(a)Credit
(b)Operational
(c)Market Risk
(d)Systemic
(e)Account
Ans: A
(b)Equity risk
(d)Commodity risk
Ans: E
187. When bank’s image and public standing is in doubt and leads to public’s loss of confidence
in a bank, it is called as-
(a)Reputational risk
(b)Moral Hazard
(c)Operational risk
(d)Market risk
Ans: A
Ans: A
a) Networked computers
b) Books
c) Channels
d) Branches
Ans: A
a) It is the rate at which central bank lends money to commercial banks in case of
shortfall
b) It is the rate at which central bank borrows money from commercial banks
Ans: B
191. What is latest the Repo rate as per RBI Monetary Policy?
a) 3.5%
b) 3.75%
c) 4%
d) 4.25%
Ans: C
192. RBI imposes SLR on the banks in our country as per Section __________/
Ans: A
193. State Bank of India, Mumbai has opened a Current Account with Citi Bank, New
York (in US $) in order to facilitate its forex transactions through this account. What
a) Vostro Account
b) Narrow Account
c) Nostro Account
d) Escrow Account
Ans: C
194. Currency Forward Contracts and Currency Futures Contracts are in our country. In
Ans: A
195. What is the rate of interest payable by RBI on the balances kept by the banks with it,
a) 3%
b) 4%
c) 5%
d) No interest is payable.
Ans: B
b) Marketable or tradable
c) Perpetual
Ans: B
197. NIM for banks stands for
Ans: A
a) Fixed rate
c) Both A & B
d) Only A
Ans: C
199. Treasury bonds and notes pays interest rate is classified as?
Ans: C
Ans: C
b) Grading the risks as low, medium and high and quantify the impact
Ans: B
a) A department that does not directly add to profits of a bank but still incurs costs to
the bank.
b) A department that does not directly add to costs of a bank but still incurs profits to
the bank
Ans: A
204. In floating exchange rate system
currency
band
d) Government or Central bank intervenes to maintain the repo rate within a narrow
band.
Ans: A
205. In the study of Risk Analysis, why the concept of Stop loss limit is kept for a Dealer
in dealing room?
Ans: C
206. The three money market products of RBI, Reverse Repo, Repo and MSF put together
is called as __________.
Ans: D
207. Integrated treasury refers to integration of all of the followings except?
a) Money Market
b) Securities Market
d) Credit Appraisal
Ans: D