Which of the following is a measure of bank's profitability?
Answer: B
Return on Assets (ROA) measures how efficiently a bank uses its assets to generate profit. It's calculated as Net Income / Total Assets.
Q.2Medium
What is the minimum Statutory Liquidity Ratio (SLR) as per RBI norms in 2024?
Answer: B
The Statutory Liquidity Ratio is currently maintained at 19.5% of net demand and time liabilities, as per RBI guidelines.
Q.3Medium
Which of the following credit facilities is typically used for short-term working capital needs?
Answer: B
Cash Credit is a short-term credit facility provided to businesses for meeting their working capital requirements on a revolving basis.
Q.4Medium
What is the primary objective of Priority Sector Lending (PSL)?
Answer: B
PSL mandates banks to lend a certain percentage of advances to priority sectors like agriculture, SMEs, and education for inclusive growth.
Q.5Medium
Which banking regulation requires banks to maintain a minimum percentage of capital against their risk-weighted assets?
Answer: C
Capital Adequacy Ratio (CAR) is a regulatory requirement ensuring banks maintain sufficient capital to absorb potential losses from their risk-weighted assets.
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Q.6Medium
If a bank's NPA (Non-Performing Assets) ratio increases significantly, what does it indicate?
Answer: B
A higher NPA ratio indicates that a larger portion of the bank's loans are in default or arrears, reflecting deteriorating asset quality and credit risk.
Q.7Medium
Which of the following best describes the function of SEBI?
Answer: B
SEBI (Securities and Exchange Board of India) regulates and develops the securities market, protecting investor interests and ensuring fair market practices.
Q.8Medium
Which of the following is an example of a non-banking financial company (NBFC)?
Answer: C
Bajaj Finance Limited is an NBFC that provides financial services like loans and deposits but doesn't have a banking license like commercial banks.
Q.9Medium
What is the minimum CRAR (Capital to Risk-Weighted Assets Ratio) requirement for scheduled commercial banks under Basel III as of 2024?
Answer: B
RBI mandates a minimum CRAR of 10.5% for scheduled commercial banks under Basel III framework, which includes capital buffers and conservation requirements.
Q.10Medium
Which of the following is NOT a credit rating agency recognized by SEBI in India?
Answer: D
Goldman Sachs is an investment bank, not a credit rating agency. CRISIL, ICRA, Care Ratings, and Brickwork Ratings are recognized credit rating agencies by SEBI.
Q.11Medium
What is the current limit for deposits under DICGC (Deposit Insurance and Credit Guarantee Corporation) coverage?
Answer: C
DICGC covers deposits up to Rs. 5 lakh per depositor per bank as per the latest amendment effective from 2024, increased from the previous Rs. 1 lakh.
Q.12Medium
Which committee's recommendations led to the implementation of Goods and Services Tax (GST) in India?
Answer: A
The Kelkar Committee (2003) recommended the implementation of GST in India, which was later formally implemented on July 1, 2017.
Q.13Medium
What is the primary function of the Insolvency and Bankruptcy Code (IBC), 2016?
Answer: B
IBC, 2016 provides a time-bound resolution process for insolvent debtors and companies, aimed at maximizing asset value and protecting creditor interests.
Q.14Medium
Which international organization sets global standards for banking supervision and capital adequacy?
Answer: C
The Basel Committee on Banking Supervision sets international standards for bank regulation and capital adequacy through Basel I, II, and III frameworks.
Q.15Medium
What does CLR (Cash Reserve Ratio) mandate banks to maintain?
Answer: A
CRR requires banks to maintain a certain percentage of their demand and time liabilities as cash reserves with the RBI, currently at 4.5% (as of 2024).
Q.16Medium
Which regulation requires banks to maintain a minimum Statutory Liquidity Ratio (SLR)?
Answer: B
Section 24 of the RBI Act, 1934 mandates that banks maintain a minimum SLR of not less than 18% of their net demand and time liabilities (NDTL).
Q.17Medium
What is the concept of 'Repo' in banking and financial markets?
Answer: B
Repo (Repurchase Agreement) is a short-term borrowing mechanism where securities are sold with an agreement to repurchase them at a higher price on a specified date.
Q.18Medium
What is the current Reverse Repo Rate as per the latest RBI monetary policy (2024-2025)?
Answer: A
The Reverse Repo Rate is typically 25-50 basis points below the Policy Repo Rate. Check latest RBI announcements for exact current rate.
Q.19Medium
Under which Act does the RBI regulate the functioning of payment systems in India?
Answer: B
The Payment and Settlement Systems Act, 2007 grants RBI the authority to regulate and oversee payment systems in India.
Q.20Medium
Which of the following best describes 'Liquidity Coverage Ratio (LCR)'?
Answer: B
LCR is a Basel III requirement ensuring banks maintain sufficient high-quality liquid assets to survive a 30-day liquidity stress scenario.
