Bank Promotion Exam Practice Tests Set 3

The law relating to payment of cheques and protection to a banker is contained in the


Options are :

  • Indian Contract Act
  • Indian Companies Act
  • Banking Regulation Act
  • None of the above

Answer :None of the above

Bank Promotion Exam Practice Tests Set 4

As per NPA guidelines an agriculture advance will be classified as NPA, when it is satisfied certain criteria. Which of the following parameter are considered for classifying an agriculture advance as NPA?


Options are :

  • A loan granted for short duration crops will be treated as NPA, if the instalment of principal or interest thereon remains overdue for two crops seasons
  • A loan granted for long duration crops will be treated as NPA if the instalment of principal or interest thereon remains overdue for one crop season.
  • Long duration crops would be crop season longer than one year and crops, which are not long duration, would be treated as short duration crops.
  • a and b above
  • All of the above

Answer :All of the above

Section 49-A of Banking regulation Act makes provisions for (a) declaration of bank rate (b) restrictions on the type of  business that the banks cannot undertake (c) no person other than a bank is authorized to accept deposits withdraw able by cheque (d) acceptance of deposits by banks.  


Options are :

  • A only
  • A and c only
  • C only
  • B only

Answer :C only

Banks can undertake permitted business activities u/s 6 (1) of B R Regulation such as (a) buying or selling of bullion (b) undertake and execute trusts (c) undertake the administration of estates as executors, trustee (d) providing of safe deposit vaults: 


Options are :

  • A, b and c only
  • B, c and d only
  • A, c and d only
  • A to d all

Answer :A to d all

Bank Promotion Exam Practice Tests Set 1

Which of the following statute and constitution of the respective bank does not match


Options are :

  • Nationalized banks- Banking Companies Act 1969
  • State bank of India- SBI Act 1955
  • State bank Associate Banks State Bank (Subsidiary Banks ) Act 1955
  • RRBs- RRB Act 1976

Answer :Nationalized banks- Banking Companies Act 1969

Which of the following statements regarding RBI is not correct


Options are :

  • RBI has the authority to issue license to banks
  • Entire capital of RBI is held by Central Govt. & State Governments
  • Central Govt. appoints the governor of RBI implies
  • Central Govt. can issue directions to RBI under RBI Act

Answer :Entire capital of RBI is held by Central Govt. & State Governments

Which of the following Act has been enacted in India on account of initiative of UN Commission on International Trade law:


Options are :

  • Prevention of Money Laundering Act
  • Information Technology Act
  • Right to Information Act
  • None of these

Answer :Information Technology Act

Bank Promotion Exam Practice Tests Set 10

Which of the following Act recognizes the electronic signatures and records equal to physical signatures and records


Options are :

  • Information Technology Act
  • Negotiable Instruments Act
  • Indian evidence Act
  • All the above

Answer :Information Technology Act

 The assessment officer can scrutinize the return submitted by the assesses and complete the assessment which is called


Options are :

  • Verified assessment
  • Scrutiny assessment
  • Verification assessment
  • Assessment by verification

Answer :Scrutiny assessment

Which of the following provisions do not match, in the context of loans by a bank: 


Options are :

  • Banks cannot grant loans on the security of their own shares- Sec 20 of B R Act
  • Banks cannot commit themselves for granting loans on behalf of their directors Sec 20 of B R Act
  • For remitting a loan in the name of a director, RBI permission is required Sec 20-A of B R Act
  • RBI can use selective credit control over banks- Sec 36 A B R Act

Answer :RBI can use selective credit control over banks- Sec 36 A B R Act

Bank Promotion Exam Practice Tests Set 11

In a contract of sale, (a) the seller transfer property in goods to buyer for a price (b) the seller agrees to transfer the property in goods to the buyer for a price (c) when the goods are transferred from seller to the buyer, the contract becomes a sale


Options are :

  • Statements (a) and (c) only are correct
  • Statements (a) and (b) only are correct
  • Statement of (b) and (c) are correct
  • All statements are correct

Answer :All statements are correct

When one or more bank is merged with another bank ot two or more banks decide to merge to form a new company, it is called


Options are :

  • Merger
  • Amalgamation
  • Liquidation
  • Winding up

Answer : Amalgamation

A bank is under obligation to make payment of cheque issued by its customer u/s 31, if the following conditions are satisfied (which one is not correct): 


Options are :

  • There are sufficient funds in the account
  • The funds are properly available for payment of the said cheque
  • The signatures of the customer are, as per records of the bank
  • cheque should be drawn in one ink, one handwriting and one script

Answer :cheque should be drawn in one ink, one handwriting and one script

Bank Promotion Exam Practice Tests Set 12

For a bank to get protection against conversion of a cheque (a) the collection should be for customer (b) the collection should be of crossed cheque crossed before falling into the hands of collecting bank (c) the collection should be in good faith (d) the collection should be without negligence


Options are :

  • A to d should be fulfilled
  • A to c should be fulfilled
  • A, c and d should be fulfilled
  • A, b and d should be fulfilled

Answer :A, c and d should be fulfilled

Which of the following is a correct statement


Options are :

  • Protection available to a bank for conversion is as per Sec 10 of NI Act
  • Protection against conversion for demand draft is as per Sec 131 of NI Act
  • Bank get protection for conversion as per Sec 131 in case of cheque and Section 131A for Demand draft, as per banking regulation Act
  • Conversion means unauthorized interference in property of a 3rd party

Answer :Conversion means unauthorized interference in property of a 3rd party

A bank guarantee has been issued by the bank in lieu of the customer being required to deposit cash security. Such guarantee is called


Options are :

  • Cash guarantee
  • Financial guarantee
  • Performance guarantee
  • Deferred payment guarantee

Answer :Financial guarantee

Bank Promotion Exam Practice Tests Set 13

The sale becomes absolute in case of mortgage by conditional sale, when


Options are :

  • Borrower makes payment of the due amount
  • Borrower fails to make payment of the due amount
  • When loan is re-structured
  • When limitation expires

Answer :Borrower fails to make payment of the due amount

In the context of letter of credit , which among the following does not match


Options are :

  • The party on whose request the LC is issued is called beneficiary
  • The bank that makes the payment to the beneficiary against documents and claims payment from issuing bank is called negotiating bank
  • Bank that has the final liability on the LC if documents are received in order- issuing bank
  • If a bank gives guarantee on LC for the payment to be made, in case issuing bank fails to pay- confirming bank

Answer :The party on whose request the LC is issued is called beneficiary

A bank issued an LC, which is to expire on June 30 appx. Its expiry date falls on


Options are :

  • 10th July or 20th June
  • (+)or (-)5 calendar days
  • (+) or (-) 10 calendar days
  • Such LC is not valid

Answer :(+)or (-)5 calendar days

Bank Promotion Exam Practice Tests Set 14

A guarantee which is issued by a bank, guaranteeing the timely payment of installment to the supplier, by the applicant (borrower), for the machinery purchased on a long term credit from the supplier is called


Options are :

  • Standby guarantee
  • Performance guarantee
  • Deferred payment guarantee
  • Statutory guarantee

Answer :Deferred payment guarantee

A private company has two shareholders who are directors of the company also. They die in an accident


Options are :

  • The company will be run by their legal heirs
  • The company will invite public to be shareholders who will chose new directors
  • The company will be compulsorily wound up
  • The advice of Company Law Board will be sought

Answer :The company will be compulsorily wound up

A company can commence its business (a) without obtaining certificate of commencement of business if it is a private company (b) without obtaining certificate of commencement of business if it is a company without any share capital (c) after obtaining certificate of commencement of business u/s 125 if it is a public company, which of these is correct: 


Options are :

  • A to c all
  • A and b only
  • B and c only
  • A and c only

Answer :A and b only

Bank Promotion Exam Practice Tests Set 15

In Mardia Chemicals vs Union of India and others, the Supreme Court had decided that


Options are :

  • SARFAESI Act is fully invalid
  • Condition of deposit of 75% amount by borrower before approaching DRT against possession notice by banks, is invalid
  • Condition of deposit of 75% amount by borrower before approaching DRAT, against decision of DRT, is invalid
  • Condition of 60 days notice before possession is correct

Answer :Condition of deposit of 75% amount by borrower before approaching DRT against possession notice by banks, is invalid

If any false information is provided to Registrar of Firms in connection with registration of a firm, the penalty is


Options are :

  • Imprisonment up to one month or fine or both
  • Imprisonment up to 2 month or fine or both
  • Imprisonment up to 3 month or fine or both
  • Imprisonment up to 6 month or fine or both

Answer :Imprisonment up to 3 month or fine or both

Limited Liability partnership are regulated under provisions of which of the following Act


Options are :

  • Indian partnership Act
  • Companies Act
  • Indian Contract Act
  • None of the given options

Answer :None of the given options

Bank Promotion Exam Practice Tests Set 16

A contract is valid, if the consideration is lawful when at the desire of the promisor, the promise (a) has done or abstained from doing (b) does or abstains from doing (c) promises to do or abstains from doing something. Which of these is correct


Options are :

  • A to c all
  • A and b only
  • B and c only
  • C and a only

Answer :A to c all

In a mortgage suit, the preliminary decree becomes the final decree


Options are :

  • When the request is made by the bank as creditor
  • When the borrower fails to pay the decretal amount
  • When the court takes a decision on the basis of its discretion
  • When the request comes from the bank and the borrower

Answer :When the borrower fails to pay the decretal amount

XYZ were allowed certain credit facilities on the guarantee of G. later on the account was got secured by equitable mortgage of the property. But for certain reasons, the bank released the equitable mortgaged. When the account became difficult of recovery and money was demanded from G also, he took the plea that he stands discharged to the extent the value of mortgage, which has been released by the bank. 


Options are :

  • Guarantor is not discharges as the mortgage was taken subsequent to the date of guarantee
  • Guarantor is not discharges as he is liable as long as borrower is liable
  • Guarantor is discharged to the extent of value of equitable mortgage, as bank has put the guarantor to loss
  • Guarantor is discharged since value of security in the account has come down

Answer :Guarantor is not discharges as the mortgage was taken subsequent to the date of guarantee

Bank Promotion Exam Practice Tests Set 17

In a contract of bailment, if the bailee does something inconsistent to the contract, the bailor can: (which is not correct )


Options are :

  • Demand the damages suffered
  • Contract become voidable at the option of the bailor
  • Demand compensation for any damage
  • None of the above

Answer :None of the above

Which of the following can be a director of a company? 


Options are :

  • X, ABC Limited , ABC Firm
  • X, ABC Firm
  • X, ABC Firm
  • X only

Answer :X only

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