SBI Associates Clerical Paper

   Questions of SBI Associates Clerical Paper

1. Which of the following statements is true?

Ans.  A licence to open a branch is issued by the Reserve Bank of India under the provisions of Banking Regulation Act, 1949

2. The important condition for granting licence of banking companies is?

Ans. The business undertaken by the banking company should not frustrate the interest of public

3. Who of the following is not a party to the IPO?

Ans. Registrar of Companies

4. Which of the following is not shown as an asset in the balance sheet of a Bank?

Ans. Borrowings

5. The credit policy of a bank does not consists of?

Ans. Advertising of loan products

6. Which of the following is a function of the agent bank relating to flow of money in the process of loan syndication?

Ans. Receiving the fee from the borrower and distributing among the participating banks

7. Which of the following is the parameter to recognize the SSI unit as sick unit?

Ans. The erosion in the net-worth due to accumulated losses is up to 50% of its net worth during the previous account year.

8. Which of the following is not the service provided by the Small Industries Service Institute?

Ans. Financial support

9. Service Area Approach (SAA) is associated with?

Ans. Rural and Semi-urban branches of commercial banks

10. Which of the following cannot be securitized?

Ans. Demand drafts received by the banker during clearing

11. Which of the following statements is true?

Ans. The beneficiary under the letter of credit may receive payment even at the pre-shipment stage

13. The Shipping guarantee is a?

Ans. Deferred payment guarantee issued by a banker at the request of the  consignee when the documents are not received and goods are received,  for facilitating the delivery of goods.

14. Which of the following statements is true?

Ans. Cardholder has to pay the 100% of the purchase amount within 30 days of purchase

15. Which of the following is not augmented feature of a credit card?

Ans. Issue of deferred guarantee

16. Which of the following is the disadvantage of going for public issue?

Ans. Need to make continuous disclosures

17. Which of the following is not a criterion to select the Investment Bankers?

Ans. No professional memberships or incorporations are required

18. Which of the following is not an asset of a bank?

Ans. Overdue recurring deposits

19. The banking company has restriction to sanction loan to?

Ans. Directors of the bank

20. Which of the following is a non-depository institution?

Ans. Mutual funds

21. The disadvantage associated with leasing company is?

Ans. High competitions because of entry to all financial institutions

22. Which of the following theory is associated with the financial system in the economic growth?

Ans. Financial repression theory

23.Which of the following is not a financial intermediary in the financial markets?

Ans. Small scale service institute.

24 Which of the following is not a function of a commercial bank?

Ans. Registration of charges and mortgages

25. Which of the following is one of the three pillars of new Basel Capital Award?

Ans. Market discipline

26. The interest in savings bank accounts of a bank is calculated on?

Ans. Minimum amount of balance that is maintained in the account in between 10th and the last day of month

27. The credit policy of a bank does not deal with?

Ans. Outstanding balances in deposit accounts

28. Issuing credit cards is a component of ?

Ans.  Retail banking

29. The origin of bank instruments can be traced to?

Ans. Goldsmith receipts

30. Which of the following is not the function of commercial banks?

Ans. Regulating the issue of bank notes.

31 Which of the following is the most important challenge before the commercial bank?

Ans. Meet the technological revolution

32. The asset's side of balance sheet consists of ?

Ans. Cash balances with other banks

33. Which of the following is an income for a bank?

Ans. Profit on revaluation of investments

34. Saving Bank Account can be opened in the name of ?

Ans. Aravind Samuel, Anurag Deepak and Amarish Sugandhi Jointly

35. The interest on recurring deposit is paid on the basis of ?

Ans. Quarterly compounding

36. Which of the following statements is true?

i. Term deposits are non-transaction deposits

ii. All term deposits are interest bearing deposits

 

37. The credit policy laid down by the top management of a bank does not deal with?

Ans. Appraisal of time and demand deposits

38. Which of the following factors is not required to be considered to analyze the repayment capacity of a borrower?

Ans. Personal educational qualifications

39. Which of the following is a facilitating service of core loan products of retail banking services?

Ans. Current or savings accounts

40. Which of the following is an most important advantage of retail banking on the resource side?

Ans. Increases the subsidiary business of a bank

41. Lenders may not provide trade-offs to the borrowers on the basic term of consumer installment credit relating to?

Ans. Maturity of the deposit

42. Which of the following is the risk associated with the retail banking?

Ans. Inadequate risk pricing

43 The advantage of consortium finance is?

i. Speedy transactions and individual approach

ii. Involvement of huge amounts

iii. Use of expertise of all the banks

44 Which of the following is not a function of the agent bank in loan syndication?

Ans. Planning for future syndication of loans

45. Which of the following is not a phase/step in the formation of loan syndication?

Ans. Finalization of supply agreement

46. Which of the following statements is true?

Ans. Small and medium enterprises both in size and shape are not homogenous in nature

47. The Nayak Committee has suggested the turnover method for assessing the working capital and pegged it at?

Ans. 20% of the projected annual turnover, as working capital limit

48. Which of the following is not a part of the rehabilitation package granted for revival of sick industry?

Ans. Not demanding the promoters contribution towards the rehabilitation package

49. Service Area Approach is associated with?

Ans. Rural finance

50. Which of the following resources cannot be securitized?

Ans. Credit balances outstanding in cash credit accounts

51. Which of the following is a type of anticipatory letter of credit?

Ans. Green clause letter of credit

52. Performance guarantee is issued?

Ans. For successful competition of Turnkey projects

53. Which of the following is not a transfer of funds by using the electronic media?

Ans. Mail transfer of funds

 

54. Which of the following is not an augmenting feature of credit cards?

Ans. Automatic recovery of interest on term loans

55 Which of the following is a disadvantage of going public issue?

Ans. Increased regulatory norms

56 Which of the following is not a reason for regulating the banking operations?

Ans. Banks earn profit from non-fund services

57. Which of the following statements is true?

Ans. Banks have authority to establish the ATMs at their convenience

58. When the customer withdraws cash from ATM, the banker and customer relation ship is?

Ans. Debtor and Creditor

59. Which of the following is a public sector Bank?

Ans. IDBI

60. Trade control in India is regulated by?

Ans. DGFT

61 Which of the following businesses is prohibited as per Sec 8 of B.R Act 1949?

Ans. Retail trading

62. Which of the following is not one of the essential elements of internal audit?

Ans. Subjectivity

63. The letter of credit, which facilitates the exporter to get pre-  shipment finance (from the stage of purchase of raw material until the  warehousing of the finished goods) from advising bank is called?

Ans. Green Clause LC

64. A term loan is classified as a non-performing asset, if interest  or installment is overdue for period exceeding how many days?

Ans. 90

65. Which of the following is an interest bearing demand deposit?

Ans. Savings Bank account

66. Debt Recovery Tribunals accept petitions from Banks and financial institutions, only when the amount of suit is for Rs?

Ans. 10 00 000 and above

67. An endorsement is deemed as an instruction to?

Ans. Paying Bank

68. Ideal Credit deposit ratio for a bank is?

Ans. 60%

69. The rate at which RBI rediscounts the bills of commercial banks is called as?

Ans. Bank Rate

70. Which of the following is not one of the RBI directives on clean note policy?

Ans. Soiled notes are to be stapled before they are remitted to Currency Chest.

71. Which of the following committees are related to 'Micro financing'?

Ans. Vyas Committee

72. The relation ship between RBI and the Bank maintaining the currency chest is that of?

Ans. Principal and Agent

73. Normally, the number of members in a self Help Group shall not exceed?

Ans. 20

74. Short fall in fulfilling the targets of Priority sector and  agricultural finance by domestic commercial banks shall be deposited  with/in?

Ans. RIDF

75. The maturity value of a Recurring deposit with a monthly  contribution of Rs 500 kept for a period of 12 months, at 9% interest  rate compounded quarterly would be Rs.?

Ans. 6, 265

76. Which of the following is not an imperfect note?

Ans. Mutilated note

77. Credit rating helps in measuring the credit risk and facilitates?

Ans. Pricing of a loan

78. The Reverse Repo has the following characteristic?

a) Borrowing by RBI from banks

b) Borrowing with government security as collateral

c) Short term borrowing

79. Under the Nayak Committee recommendations, the quantum of working  capital limits from the bank is minimum percentage of the projected  annual sales?

Ans. 20%

80. Banks insist on providing finance for those projects or  activities only which they consider to be viable. What is meant by  viability of project?

Ans. Capacity to generate cash, adequate to service debt and surplus for borrower's personal requirement.

81. Letter of negative lien obtained from borrower by a bank contains?

Ans. An undertaking not to create any encumbrance/lien on the property which he owns but not yet mortgaged to the bank

82. Which of the following statement is CORRECT?

Ans.  Consortium advances to be treated as NPA on the basis of recovery by individual banks

I. The company looses the opportunity to raise more funds

III. Under pricing results in lower net worth on an increased equity.

84. Corporate Bank files suit for recovery of its loan against the  guarantor only and not the borrower. Guarantor pleads in the court that  before filing suit against him, money should be recovered from the  borrower. In such circumstances, the bank can seek recourse in the court  against?

Ans. At its discretion it can proceed against any one

85. A letter of credit (LC) wherein the credit available to the customer gets reinstated after the bill is paid is known as?

Ans. Revolving LC

86. Regional Rural Banks are?

Ans. Public sector scheduled commercial banks

87. Large corporate customers demand?

Ans. Increasingly sophisticated products from their banks at the lowest possible cost.

88. Funded Services under corporate banking does not include?

Ans. Letters of Credit

89. Which of the following is not directly involved in rural lending?

Ans. SIDBI

90. PACSs provide?

Ans.  Mainly short term credit

91. The purpose of which is to make credit of available to essential sectors of the economy according to national priorities?

Ans. Selective Credit Control (SCC)

92. The system of note issue followed by the RBI is?

Ans.  Minimum reserve system

93. The rate at which the Reserve Bank of India lends to the  commercial banks in very short term against the backing of the  Government securities is known as?

a) Bank rate

Ans. Repo rate

94. Scheduled banks are those?

Ans.  Includued in the 2nd schedule of the Reserve Bank of India Act -1934

95. The following is classified as a public sector bank?

Ans. IDBI Bank Ltd

96. The banker-customer relationship in credit card payment is?

Ans.  Debtor-creditor

97. The base rate is set by?

Ans. Individual banks

98. State Bank of India's new floating rate of deposit is directly linked to?

Ans. Base Rate

99. Six private sector banks were nationalised on April 15, 1980, whose reserves were more than?

Ans. Rs. 200 crores

100. Security printing press was established in 1982 at?

Ans.  Hyderabad