As per RBI's Monetary Policy 2024, what is the current Repo Rate (as of latest announcement)?
Answer: C
The RBI Repo Rate stands at 6.5% as per the latest Monetary Policy Committee decision in 2024
Q.62Medium
A bank's Asset Quality Indicator shows 8% Gross NPAs. If total Advances are ₹4,00,000 crore, and Provision Coverage Ratio is 65%, calculate the Net NPA ratio approximately:
Which of the following is NOT a component of Basel III Tier-I Capital?
Answer: C
Subordinated Debt is part of Tier-II Capital. Tier-I Capital comprises CET1 and AT1 Capital only
Q.64Medium
A bank's Return on Assets (ROA) decreased from 1.2% to 0.95% while maintaining constant total assets of ₹8,00,000 crore. Calculate the decrease in Net Profit in rupees:
According to RBI's latest guidelines 2024, what is the maximum Loan-to-Value (LTV) ratio for retail housing loans to individual borrowers?
Answer: C
RBI permits maximum 80% LTV for retail housing loans to individuals as per macroprudential guidelines to manage credit risk
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Q.66Medium
A bank's Consumer Advances increased by ₹35,000 crore while Total Advances grew by ₹80,000 crore in FY2024. Calculate the share of Consumer Advances in total advances growth:
Answer: B
Share = (₹35,000 / ₹80,000) × 100 = 43.75% of total advances growth came from consumer segment
Q.67Hard
Examine the data: Bank X's Current Ratio (liquid assets to demand deposits) is 45%, while regulatory requirement is 80%. This indicates:
Answer: B
45% Current Ratio against 80% requirement indicates the bank is deficient in liquid assets relative to demand deposits, posing liquidity risk
Q.68Hard
A bank's Commercial Advances showed CAR of 18.5%, Agricultural Advances CAR of 15.2%, and Consumer Advances CAR of 11.8%. Which segment carries the highest credit risk as per risk weighting?
Answer: A
Higher CAR for a segment indicates higher risk weights assigned. Commercial Advances at 18.5% CAR carries highest risk weighting under Basel III norms
Q.69Hard
Analyze quarterly trends: Bank Y's Net Interest Income grew 8% while Total Assets grew 12% QoQ. This implies:
Answer: B
When assets grow faster (12%) than NII (8%), it indicates NIM is compressing as the bank is earning lower interest on incremental assets
Q.70Hard
Under RBI's Prompt Corrective Action (PCA) framework 2024, at what Capital Adequacy Ratio threshold does a bank enter PCA supervision?
Answer: B
Under RBI's PCA framework, SCBs with CAR below 8.5% (along with other indicators) trigger supervisory action and corrective measures
Q.71Hard
A bank's Statutory Liquidity Ratio (SLR) requirement is 18%. If deposits are ₹10,00,000 crore and current SLR maintenance is ₹1,95,000 crore, calculate the deficit/surplus:
Which regulatory body in India is responsible for issuing Unified Payment Interface (UPI) guidelines and overseeing digital banking infrastructure?
Answer: B
The Reserve Bank of India (RBI) is the primary regulator responsible for UPI guidelines, digital banking infrastructure, and payment system oversight
Q.73Hard
Analyze the complex scenario: Bank Z has CAR of 16%, NPA ratio of 6.5%, and ROA of 0.8%. It wants to increase lending by ₹50,000 crore. What is the primary constraint?
Answer: B
With 16% CAR (closer to Basel III minimum), and planned lending increase, the bank's capital adequacy becomes the binding constraint for expansion
Q.74Medium
Bank A reported a Net Interest Margin (NIM) of 2.8% in Q3 2024. If the bank's total interest income was ₹15,000 crores, what was the approximate net interest income?
Answer: A
NIM = Net Interest Income / Total Assets. Given NIM of 2.8% and interest income of ₹15,000 cr, net interest income approximates to ₹4,200 crores using the relationship between these metrics.
Q.75Easy
Which of the following is NOT a component of Basel III capital framework adopted by RBI?
Answer: C
Basel III framework comprises CET1, Tier 1, and Tier 2 capital. Tier 3 Capital was part of Basel II but has been eliminated in Basel III. RBI has adopted Basel III norms.
Q.76Easy
A bank's Asset Quality Ratio improved from 2.1% to 1.8% in FY 2024. What does this indicate?
Answer: B
Asset Quality Ratio (NPA ratio) measures gross NPAs as percentage of gross advances. A decrease from 2.1% to 1.8% indicates improvement in overall loan quality and reduced stressed assets.
Q.77Easy
Bank B's Cost-to-Income Ratio decreased from 48% to 44% between Q2 and Q3 2024. What is the implication for operational efficiency?
Answer: B
Cost-to-Income Ratio shows operating costs as percentage of operating income. A decrease from 48% to 44% indicates that the bank is spending less to generate each rupee of income, showing improved operational efficiency.
Q.78Medium
Examine the data: Bank X reported ₹5,000 crores in gross advances with ₹150 crores in gross NPAs. The bank maintained a provision coverage ratio of 65%. Calculate the net NPA amount.
Answer: A
Gross NPAs = ₹150 crores. Provisions made = 65% of ₹150 = ₹97.5 crores. Net NPA = ₹150 - ₹97.5 = ₹52.5 crores.
Q.79Medium
Under RBI's revised norms for 2024, what is the minimum Common Equity Tier 1 (CET1) ratio that banks must maintain?
Answer: B
As per Basel III implementation in India, RBI mandates a minimum CET1 ratio of 6.5% (including capital conservation buffer of 1.875%), increased from the earlier 5.5%.
Q.80Medium
Bank C's Loan-to-Deposit Ratio (LDR) increased from 78% to 83% in Q3 2024. What risk does this indicate?
Answer: A
LDR of 83% means the bank is deploying 83% of deposits as loans. An increase towards the upper threshold (80% is regulatory comfort zone) indicates higher liquidity risk if deposits decline.
