Which of the following is NOT a function of the Reserve Bank of India?
Answer: C
RBI does not directly lend to retail customers. Its primary functions include currency issuance, forex management, and monetary policy implementation through banking channels.
Q.2Easy
What is the current repo rate set by RBI as of 2024?
Answer: B
As per RBI's latest monetary policy in 2024, the repo rate stands at 6.5%. This is the rate at which RBI lends to commercial banks.
Q.3Easy
Which bank is the 'Banker to the Government' of India?
Answer: B
RBI serves as the Banker to the Government of India, managing government accounts, treasury operations, and public debt.
Q.4Easy
What does NEFT stand for in banking?
Answer: A
NEFT (National Electronic Funds Transfer) is an electronic fund transfer system in India for transferring funds between banks.
Q.5Medium
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.
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Q.6Medium
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.7Easy
Which organization regulates insurance companies in India?
Answer: C
Insurance Regulatory and Development Authority of India (IRDAI) regulates and supervises insurance companies operating in India.
Q.8Easy
What is the full form of RTGS?
Answer: A
RTGS (Real Time Gross Settlement) is a system for real-time transfer of funds and securities between banks in India.
Q.9Medium
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.10Medium
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.11Medium
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.
Q.12Easy
What does KYC stand for in banking?
Answer: A
KYC (Know Your Client) is a mandatory procedure for banks to verify customer identity and assess their financial profile to prevent fraud and money laundering.
Q.13Medium
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.14Hard
Which committee's recommendations led to the implementation of Basel III norms in Indian banking?
Answer: D
Basel III norms were developed by the Basel Committee on Banking Supervision and adopted globally to strengthen banking sector resilience post-2008 financial crisis.
Q.15Hard
Under Basel III, what is the minimum Common Equity Tier 1 (CET1) capital ratio required for banks?
Answer: A
Basel III mandates a minimum CET1 ratio of 4.5% of risk-weighted assets, along with additional capital buffers for systemically important banks.
Q.16Medium
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.17Hard
What is the concept of 'Too Big to Fail' in banking regulation?
Answer: B
The 'Too Big to Fail' concept recognizes that systemically important banks require stricter regulation and capital requirements because their failure could trigger a financial crisis.
Q.18Medium
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.19Hard
In a situation where a bank's Core Banking Solution (CBS) faces a system failure, which RBI regulation requires it to have a business continuity plan?
Answer: D
RBI's multiple guidelines including IT Risk Management and Operational Risk frameworks mandate banks to have robust business continuity and disaster recovery plans to ensure service continuity.
Q.20Easy
What is the maximum period for which a bank can classify an account as NPA (Non-Performing Asset)?
Answer: B
RBI guidelines classify an account as NPA after 90 days of non-payment. This is the standard threshold for identifying non-performing assets in Indian banking.
