Banking and Financial Institutions MCQ Questions and Solutions with Explanations

51

To calculate capital adequacy ratio, the banks are required to take into account which of the following risks?

A) Credit risk and operational risk B) Credit risk and market risk C) Market risk and operational risk D) Credit risk, market risk, operational risk

Discuss

Answer & Solution

Answer: Option D

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52

Repo rate is the rate at which

A) Banks takes money from RBI B) RBI takes money from banks C) Government take money from RBI D) Money is taken by one bank from another bank

Discuss

Answer & Solution

Answer: Option A

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53

Which of the following can be defined as the contract between the original insurer and another insurer?

A) Premium B) Cover note C) Reinsurance D) Co-insurance

Discuss

Answer & Solution

Answer: Option C

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54

Which one of the following is not the function of NABARD?

A) To provide refinance assistance by way of short-term credit to state cooperative banks and sectoral rural banks etc, approved by the RBI for some specific purposes B) To undertake inspection of cooperative societies other than primary cooperative societies and RRBs C) To promote research in various aspects of the problems of urban development D) To subscribe to share capital or invest in securities of any institution concerned with agricultural and rural development

Discuss

Answer & Solution

Answer: Option C

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55

The well established and well-organised market where the sale-purchase of different securities takes place according to certain laws, is known as

A) production exchange B) stock exchange C) commodity exchange D) None of these

Discuss

Answer & Solution

Answer: Option B

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56

Securitization is:

A) non-performing loans are acquired from banks and financial institutions at a discounted value and security receipts issued to them so that these loans are removed from their balance sheet enabling them to reduce the provision in respect of such loans and improve profitability B) converting the illiquid loans of banks and financial institutions by Securitization Companies into tradable securities, after they are acquired and sold to the investors C) a process of acquisition of non-performing loans from banks by a Securitization company and convert them into tradable securities and sold to the investors D) All of the above

Discuss

Answer & Solution

Answer: Option D

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57

If the chairman is unable to attend any meeting of the SEBI then

A) the meeting shall be adjourned till the chairman is able to attend the meeting B) the meeting shall continue without anyone chairing it and the chairman shall be informed about the proceedings of the same C) the chairman has to leave a message appointing some other person to be in the chair in his absence D) any other member chosen by the members present from amongst themselves shall preside at the meeting

Discuss

Answer & Solution

Answer: Option D

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58

Which of the following is not an instrument of credit control in the banking system?

A) Open market operations B) Moral per suasion C) Cash reserve ratio D) Tax rates

Discuss

Answer & Solution

Answer: Option D

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59

Nomination facility is available to:

A) Individuals/Sole Proprietorship accounts/Private Limited Companies B) Individuals/Sole Proprietorship Accounts/Partnership Accounts C) Individuals/Sole Proprietorship Accounts D) All of the above

Discuss

Answer & Solution

Answer: Option C

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60

Credit rating:

A) Is used to rate the borrowers while giving advances B) Is used to work out performance of the employees C) Is used to calculate the number of excellent audit rated branches D) Is not used in any bank

Discuss

Answer & Solution

Answer: Option A

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Banking and Financial Institutions MCQ Questions and Solutions with Explanations | Commerce