Bank Promotion Exam Practice Tests Set 12

REPO  refers to


Options are :

  • Absorption of funds from banking system
  • injection of funds in banking system
  • long term borrowing
  • tools of monetary policy on permanent basis

Answer :injection of funds in banking system

Bank Promotion Exam Practice Tests Set 13

BCSBI is a


Options are :

  • Independent and autonomous body
  • floated by BSE & NSE
  • Government of India undertaking
  • bank

Answer :Independent and autonomous body

“Stand still ‘’ Clause in CDR system


Options are :

  • agreement by lender not to file a criminal suit for 90 or 180 days
  • agreement by borrower not to file a criminal suit for 90 or 180days
  • Agreement by both borrower and lender where they commit themselves not taking recourse to any other legal action during stand still period
  • the standstill clause is applicable for only civil action and not for criminal action
  • 3 & 4

Answer :3 & 4

Modern Bank had granted a term loan for purchase of a car to Mr. Ramesh Chander which has become time barred debt last month. A letter written 8 months back, by Mr. Ramesh Chander to his friend Mr. Satish Kumar falls in the hands of the bank in which he had requested Mr. Satish Kumar to give him certain funds as he has to repay the above stated loan of the bank.  


Options are :

  • the letter can be treated as acknowledgement of debt if particulars of the loan match with those given in the letter which would extend the limitation period
  • the letter cannot be used for the purpose of the limitation period as it is not stamped
  • the letter cannot be used for limitation purpose as it is not addressed to the bank
  • the letter can be used for limitation period but it is not stamped adequately
  • all the above

Answer :the letter can be treated as acknowledgement of debt if particulars of the loan match with those given in the letter which would extend the limitation period

Bank Promotion Exam Practice Tests Set 14

Which of the following defines a foreign exchange forward contract better?  


Options are :

  • exchange rate that is determined in future
  • exchange rate that is determined in future but delivery is made now
  • exchange rate that is determined now but delivery of currency is made in future on a day fixed at the time of making the contract
  • exchange rate and delivery, both are determined in future
  • none of the above

Answer :exchange rate that is determined now but delivery of currency is made in future on a day fixed at the time of making the contract

Your branch receives a cheque of Rs.2500 drawn in favour of Mr ramkumar for payment across the counter. It is observed that the name of the payee Mr. Mr ramkumar in the cheque is written in Hindi while the other particulars are in English: 


Options are :

  • Bank will return the cheque
  • Bank will ask Mr. ramkumar to write the name in English also
  • Bank will ask the payee to get it corrected in English from the drawer
  • Bank will make the payment of the cheque
  • Bank will make the payment, after enquiring from the drawer

Answer :Bank will make the payment of the cheque

In case of overdraft facility, where the account is showing credit balance temporarily, what is the relationship of the bank and customer.  


Options are :

  • creditor and debtor
  • debtor and creditor
  • principle and agent
  • trustee and beneficiary
  • none of the above

Answer :debtor and creditor

Bank Promotion Exam Practice Tests Set 15

A bank finds it difficult to repay the short term deposits on maturity to its deposits because the funds of the bank are locked in long term loans or investments. The risk arising from this situation is called:


Options are :

  • Interest rate risk
  • Liquidity risk
  • Operational risk
  • Market risk
  • Credit risk

Answer :Liquidity risk

Which section of the respective Act covers the SLR:  


Options are :

  • Section 24(2A) of BR Act 1949
  • Section 23 of BR Act 1949
  • Section 27 of RBI Act
  • Section 24(2) of RBI Act
  • Section 14 of BR Act

Answer :Section 24(2A) of BR Act 1949

A company is having its current account with 3 branches of your bank and on a single days makes cash withdrawals of Rs.40000 from one branch, Rs.35000 from the 2nd branch and Rs.25000 from the 3rd branch. What is the status of application of Banking Cash Transaction Tax: 


Options are :

  • bank is required to deduct the tax as the total amount of withdrawal on a single day is Rs.1 lac
  • bank is not required to deduct because the amount is not more than Rs.1 lac
  • bank is not liable to deduct because the amount of single withdrawal is less than Rs.1 lac
  • bank is required to deduct as the amount of each withdrawal is of Rs.25000 or above
  • Bank is not required to deduct as the amount is less than Rs.1 lac for each branch and the amount withdrawn from all branches is not to be aggregated

Answer :Bank is not required to deduct as the amount is less than Rs.1 lac for each branch and the amount withdrawn from all branches is not to be aggregated

Bank Promotion Exam Practice Tests Set 16

Any Bank note containing slogans & messages of political nature written across it, is a


Options are :

  • soiled note
  • mutilated note
  • cease to be legal tender
  • only 50% value will be paid

Answer :cease to be legal tender

Your branch has sanctioned cash credit limit of Rs.12 lac to M/s United Pharmacy. As at the close of July 31, it has been carrying stocks worth Rs.9 lac, sundry creditors of Rs.3 lac and book debts of Rs.6 lac. Bank has prescribed a margin of 25% on stocks and 30% on book debts. What is the maximum amount that can be withdrawn in the cash credit limit?  


Options are :

  • Rs.8.70 lac
  • Rs.8.30 lac
  • Rs.12 lac
  • Rs.6.75 lac
  • Rs.7.25 lac

Answer :Rs.8.70 lac

Mr. sawant is having a clean overdraft account for Rs. 25,000 with a debit balance of Rs. 20,000. Inspite of repeated reminders, he refused to adjust the overdraft account. He is having a safe deposit locker and also safe custody account. On which of the following bank, cannot exercise general lien.


Options are :

  • Articles in safe deposit locker
  • Contents of the safe custody
  • On safe custody only after giving notice
  • All of the above

Answer :All of the above

Bank Promotion Exam Practice Tests Set 17

Mr sangeetha, an illiterate customer in your branch, who is maintaining a savings account, requests you to permit her to authorise her friend Bharat to operate his account:


Options are :

  • An illiterate, being incompetent to contract, cannot appoint an agent,
  • Since an illiterate person cannot grant a power of attorney his requests cannot be complied with
  • The request of the illiterate customer may be acceded to on his executing a power of attorney
  • The requests of the illiterate customer may be acceded only for cash transactions.

Answer :The request of the illiterate customer may be acceded to on his executing a power of attorney

At the time of renewal of working capital limits by your branch, the loan officer observed that M/s Babra Enterprises’s utilisation of funds on a long term basis is 80% of the long term sources during the year. Which among the following would be the result of this kind of financial management:  


Options are :

  • the current liabilities would increase
  • the current assets would decline
  • the current ratio would decline
  • the current ratio would improve
  • none of the above

Answer :the current ratio would improve

M/s A, B and Co. having A and B as partners and maintain current account. One of them dies and firm’s account shows credit balance. Who is to receive the payment?


Options are :

  • Legal heirs of deceased partner and surviving partner is proportion of their profits
  • Legal heirs of deceased partner and surviving partner in proportion of their capital
  • Only surviving partner

Answer :Only surviving partner

Bank Promotion Exam Practice Tests Set 18

A banker is justified in disclosing his customer's affairs and accounts where:


Options are :

  • The disclosure is made with the express or implied consent of the customer.
  • There is a duty to the public to disclose.
  • The interest of the Bank requires disclosure
  • 1and 2 above
  • 1, 2 and 3 above

Answer :1, 2 and 3 above

Popular Bank decides to provide finance to Ghai Films Ltd for production of a film. The working capital assessment would be done by the bank on the basis of: 


Options are :

  • cash budget system
  • turnover method of Nayak Committee
  • Traditional method of Tandon Committee
  • any of the above at bank’s discretion
  • none of the above

Answer :cash budget system

One of the Trustees of a Trust maintaining an account with our Bank is adjudged as insolvent. A cheque signed by him was presented through clearing after you received the notice of insolvency of the trustee. What will you do?


Options are :

  • The cheque will be returned with the reason "trustee declared insolvent"
  • The cheque can be paid safely
  • The cheque would be returned with the reason "confirmation from the official assignee is available".
  • Cheque will be paid if the other solvent trustees give their consent
  • The matter will be referred to Head Office.

Answer :The cheque can be paid safely

Bank Promotion Exam Practice Tests Set 19

In a foreign exchange transaction, a right but not the obligation to buy or sell is called:


Options are :

  • Prerogative
  • Call
  • Kerb
  • Option
  • None of these

Answer :Option

What is the period of limitation for the recovery of a loan given on the basis of a demand promissory note:  


Options are :

  • Three years
  • Three years from date of note
  • Three years from filing of suit
  • Three years from date of default
  • b and d

Answer :Three years from date of note

In case of death of depositor, the status of nominee will be 


Options are :

  • Legal heir
  • administrator
  • executor
  • trustee of legal heirs

Answer :trustee of legal heirs

Bank Promotion Exam Practice Tests Set 2

In case of two current accounts with same partners but in different names, if in one account there is credit balance and in other account debit balance, can the bank exercise the right of Set-Off after following the normal procedure


Options are :

  • No since the names are different
  • yes if the order of Partners are same in both the accounts
  • yes since the partners are identical
  • conclusion can be drawn only after going through the partnership deed

Answer :yes since the partners are identical

In case of joint safe custody accounts, how many nominees can be appointed?


Options are :

  • One
  • Two
  • Three
  • None

Answer :None

Mr B is the legal heir of MR A. On the death of MR A, after following the usual formalities the bank has credited Rs 10500/- being the claim amount of the deceased  in the account. of MR B. Immediately after the credit, a Garnishee order attaching the account of Mr B is received for Rs 10000/-. The balance in the account is Rs 10 600/- after the above credit. You will attach


Options are :

  • Rs 100 only
  • Rs 10000
  • Rs 10600
  • Rs 10500

Answer :Rs 10000

Bank Promotion Exam Practice Tests Set 1

Corporate Bank files suit for recovery of its loan against the guarantor only and not the borrower. Guarantor pleads in the court that before filing suit against him, money should be recovered from the borrower. In such circumstances, the bank can seek recourse in the court against:  


Options are :

  • all the liable parties together only
  • any one of them at a time
  • all separately
  • at its discretion it can proceed against any one
  • at the discretion of the court

Answer :at its discretion it can proceed against any one

Which of the following is not true in respect of CIBIL? 


Options are :

  • Pulling up CIBIL report is mandatory for all loans
  • Mandate for pulling up the report and sharing of information from customer is mandatory
  • Report is to be pulled up at the front end.
  • The customer will have to pay for the report
  • None of the above.

Answer :None of the above.

In those case where the process of dissolution of a firm has started, what are the situations where the partners still have rights to bind the other partners:  


Options are :

  • To wind up the business of firm
  • To complete all those transactions which could not be completed till date of dissolution
  • till all the liabilities of the firm are discharged
  • a and b
  • a to c

Answer :a and b

Bank Promotion Exam Practice Tests Set 10

A fixed deposit is in the names of A and B with operating instructions E/S. On the date of maturity Mr. A presents the original receipt duly discharged,but before you could make payment to Mr. A ,the other person MR B gives in writing that the amount should not be paid to MR A.You will


Options are :

  • pay only on the discharge of both
  • pay to MR A ignoring the request of MR B.
  • obtain an indemnity from MR A and pay
  • As there is a dispute, it can be paid only if MR B withdraws his letter

Answer :pay to MR A ignoring the request of MR B.

Your branch receives a cheque of Rs.17500 in the account of a saving bank customer. The balance in the account is Rs.16700. An outstation cheque of Rs.23000 has been sent for collection, the proceeds of which have not been received as yet. While returning the cheque, which among the following reasons will be given:  


Options are :

  • insufficient funds
  • exceeds arrangements, please present again
  • effects not cleared, please present again
  • drawer’s instructions awaited
  • refer to drawer

Answer :insufficient funds

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