Entrance Exams
Govt. Exams
RBI permits maximum 80% LTV for retail housing loans to individuals as per macroprudential guidelines to manage credit risk
ROA decrease = (1.2% - 0.95%) = 0.25%. Decrease in profit = 0.25% × ₹8,00,000 crore = ₹2,000 crore
Subordinated Debt is part of Tier-II Capital. Tier-I Capital comprises CET1 and AT1 Capital only
Gross NPAs = 8% × ₹4,00,000 = ₹32,000 crore. Provisions = 65% × ₹32,000 = ₹20,800 crore. Net NPAs = ₹32,000 - ₹20,800 = ₹11,200 crore. Net NPA ratio = (11,200/4,00,000) × 100 = 2.8%
The RBI Repo Rate stands at 6.5% as per the latest Monetary Policy Committee decision in 2024
Improved ROE despite lower NPM indicates higher financial leverage (more debt relative to equity), amplifying returns to equity holders
Previous NPA ratio = (18,000/3,00,000) × 100 = 6%. New NPA ratio = (15,000/3,00,000) × 100 = 5%. The ratio decreased.
When advances grow faster than deposits (15% > 12%), the Loan-to-Deposit ratio increases, indicating higher credit expansion relative to deposit mobilization
Tier-II Capital Ratio = (Tier-II Capital / RWA) × 100 = (45,000 / 6,00,000) × 100 = 7.5%
Lower Cost to Income Ratio indicates better operational efficiency as operating costs are lower relative to income generated