If a bank offers 8% per annum simple interest on a savings account, what will be the total interest earned on ₹50,000 after 3 years?
A ₹12,000 B ₹15,000 C ₹18,000 D ₹20,000
SI = (P × R × T)/100 = (50,000 × 8 × 3)/100 = ₹12,000
A bank's Current Account balance shows a debit of ₹5,000. What does this indicate?
A The bank owes money to the account holder B The account holder owes money to the bank C There is no balance in the account D The account is frozen
A debit in Current Account means the account holder is in overdraft and owes money to the bank
What is the Base Rate set by RBI as of 2024?
A 4.5% B 5.5% C 6.5% D RBI no longer uses Base Rate
RBI discontinued Base Rate framework in October 2019 and replaced it with repo rate-based monetary transmission
If the Repo Rate is 6.5% and Reverse Repo Rate is 6.25%, which statement is true?
A Banks pay more interest on deposits than they earn on lending B Banks earn more on lending than they pay on deposits C Both rates are equal D The difference is irrelevant to banking operations
Repo Rate is higher than Reverse Repo Rate, so banks earn more when lending to the central bank versus borrowing
A customer deposits ₹1,00,000 in a Fixed Deposit at 7% p.a. for 2 years with annual compounding. What is the final amount?
A ₹1,14,490 B ₹1,14,980 C ₹1,15,490 D ₹1,16,490
A = P(1 + r/100)^n = 1,00,000(1.07)^2 = 1,00,000 × 1.1449 = ₹1,14,490
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What is the maximum deposit amount covered under DICGC insurance scheme as of 2024?
A ₹1 lakh per depositor per bank B ₹2 lakh per depositor per bank C ₹5 lakh per depositor per bank D Unlimited
DICGC (now DIGC) covers maximum ₹5 lakh per depositor per bank since May 2021
In a bank's balance sheet, what does NPA (Non-Performing Asset) refer to?
A New Product Advancement B Loans where payments are overdue by 90+ days C Net Profit Amount D National Policy Agreement
NPA is a classification for loans where principal or interest payment is overdue by 90 days or more
A customer takes a loan of ₹2,00,000 at 12% p.a. for 5 years. What is the total simple interest?
A ₹1,20,000 B ₹1,40,000 C ₹1,60,000 D ₹2,00,000
SI = (2,00,000 × 12 × 5)/100 = ₹1,20,000
If a bank's CAR (Capital Adequacy Ratio) is 15%, what does this indicate?
A The bank has ₹15 in capital for every ₹100 of assets B The bank is undercapitalized C The bank exceeds the minimum regulatory requirement D Both A and C
CAR of 15% means the bank has adequate capital buffer. Regulatory minimum is 10.5%, so 15% indicates compliance and strength
What is the current Statutory Liquidity Ratio (SLR) requirement set by RBI as per 2024-2025?
A 15% B 18% C 20% D 25%
As of 2024, RBI maintains SLR requirement at 18% of Net Demand and Time Liabilities (NDTL)
A data interpretation question: Bank X processed 5,000 transactions in Q1 2024, with 98% success rate. How many transactions failed?
A 100 B 98 C 102 D 50
Failed transactions = 5,000 × 2% = 5,000 × 0.02 = 100 transactions
If a bank's Net Interest Margin (NIM) increased from 2.8% to 3.2%, what does this signify?
A The bank's profitability has decreased B The bank's profitability has improved C The bank's lending has decreased D There is no impact on profitability
An increase in NIM indicates the bank is earning more profit on its lending and deposit operations
Calculate the EMI for a loan of ₹5,00,000 at 10% p.a. for 5 years (60 months). (Use approximate formula)
A ₹9,500 B ₹10,600 C ₹11,000 D ₹12,500
Using EMI formula: P[r(1+r)^n]/[(1+r)^n-1] ≈ ₹10,600 (Monthly rate = 10%/12)
What does the term 'Markdown' mean in banking context?
A Reduction in interest rates on deposits B A discount offered by the bank on services C The difference between buying and selling price of securities D A penalty charged by RBI
Markdown refers to the spread between the bid-ask prices in securities trading by banks
According to the 2024-2025 pattern, what is the current CRR (Cash Reserve Ratio) in India?
A 3% B 4% C 4.5% D 5%
As of 2024, RBI has maintained CRR at 4% of NDTL for banks
A bank offered 6% interest on deposits and charged 9% on loans. What is the spread?
A 2% B 2.5% C 3% D 3.5%
Spread = Lending rate - Deposit rate = 9% - 6% = 3%
If Bank's total assets are ₹10,00,000 crores and equity is ₹50,000 crores, what is the leverage ratio?
A 5:1 B 10:1 C 15:1 D 20:1
Leverage Ratio = Total Assets / Equity = 10,00,50 000
What is the significance of the 'Basel III' accord in banking?
A It sets standards for bank capital adequacy B It regulates deposit interest rates C It controls loan disbursement amounts D It manages RBI's monetary policy
Basel III sets international standards for bank capital adequacy, stress testing, and market liquidity risk
A customer invests ₹50,000 in a mutual fund scheme offered by a bank with average annual returns of 12%. What will be the investment value after 2 years (compounded annually)?
A ₹62,720 B ₹64,800 C ₹65,920 D ₹67,500
A = 50,000(1.12)^2 = 50,000 × 1.2544 = ₹62,720
If Bank A's Capital Adequacy Ratio (CAR) is 15% and Bank B's CAR is 12%, which bank has a stronger capital position relative to the Basel III minimum requirement of 10.5%?
A Bank A with a buffer of 4.5% above minimum B Bank B with a buffer of 1.5% above minimum C Both banks are equally positioned D Cannot be determined without asset information
Bank A has CAR of 15% vs Basel III minimum of 10.5%, giving a buffer of 4.5%. Bank B has only 1.5% buffer. Higher CAR indicates stronger capital position and lower risk.
