Entrance Exams
Govt. Exams
Gross NPA = NPA Ratio × Total Advances = 2.8% × ₹1,00,000 crore = ₹2,800 crore.
RBI guidelines recommend banks allocate at least 10% of their IT budget for cybersecurity measures and infrastructure resilience.
NIM improves when lending rates increase (higher interest income) or deposit rates decrease (lower interest expense), or both. This widens the spread.
CAR = (Tier 1 + Tier 2 capital) / Risk-weighted assets = (5,000 + 2,000) / 70,000 = 7,000 / 70,000 = 10%.
Under the PCA framework, a bank is placed under regulatory action if its CAR falls below 9%, which is below the minimum requirement of 10.5%.
A CIR of 42% (lower is better) indicates the bank spends ₹42 to earn ₹100, which is considered efficient. Industry average for Indian banks is around 40-45%.
As of 2024, the RBI has mandated a minimum SLR of 18% of net demand and time liabilities (NDTL) for scheduled commercial banks.
Q1 to Q2: (600-500)/500 = 20%. Q2 to Q3: (720-600)/600 = 20%. Average growth rate = 20%.
When advances grow faster than deposits, it creates a liquidity mismatch. The bank may struggle to fund its loan portfolio, potentially violating LDR and LCR norms.
The LCR under Basel III requires banks to maintain high-quality liquid assets sufficient to survive at least 30 days of stressed cash outflows.