CAIIB 2020 Advanced Bank Management Mock Tests Set 11

The most important requirement when planning a learning programme or event for a group of people is:


Options are :

  • to take account of the principles of learning as explained by learning theory (Correct)
  • to understand the individual learning needs of participants
  • to understand the learning styles of participants
  • to consider how an appropriate blend of training techniques can be deployed

Answer :to take account of the principles of learning as explained by learning theory

CAIIB 2020 Advanced Bank Management Mock Tests Set 3

Providing training development opportunities, and career information programs, are all part of the ------------------’s role in career development.


Options are :

  • Individual
  • Manager
  • Supervisor (Correct)
  • Company

Answer :Supervisor

A learning organization is one in which:


Options are :

  • extensive and well-planned training programmes are in place
  • continuous improvement is achieved by providing a healthy environment for learning (Correct)
  • continuous attention is paid to the satisfaction of individual learning needs
  • relevant knowledge is captured and disseminated systematically

Answer :continuous improvement is achieved by providing a healthy environment for learning

Which of the following is a process of attracting individuals on a timely basis, in sufficient numbers, and with appropriate qualifications, to apply for jobs with an organization?


Options are :

  • Selection
  • Recruitment (Correct)
  • Staffing
  • Enrolment

Answer :Recruitment

CAIIB 2020 Bank Financial Management Mock Tests Set 12

The notion of the learning organization:


Options are :

  • has been implemented effectively in many companies
  • is fundamentally aspirational
  • suggests that organizations have a life of their own and are in themselves capable of learning (Correct)
  • provides an essential guide to the formulation and implementation of learning and development strategies

Answer :suggests that organizations have a life of their own and are in themselves capable of learning

The focus of Human Resource Management revolves around"


Options are :

  • Machine
  • Motivation
  • Money
  • Men (Correct)

Answer :Men

Demand for human resources and management is created by


Options are :

  • Expansion of industry (Correct)
  • Shortage of labor
  • Abundance of capital
  • Consumer preferences

Answer :Expansion of industry

CAIIB 2020 Advanced Bank Management Mock Tests Set 12

In term loans, the economic/financial feasibility of a project involves analysis of which of the following aspects?


Options are :

  • Return on Investment
  • Break-even Analysis
  • Sensitivity Analysis
  • all of the above (Correct)

Answer :all of the above

CAIIB 2020 Advanced Bank Management Mock Tests Set 10

RBI has issued guidelines on fair practices code for lending. These guidelines pertain to:


Options are :

  • application for loans and their processing.
  • loan appraisal and terms/conditions.
  • post disbursement supervision.
  • all of the above (Correct)

Answer :all of the above

Under Turnover Method of working capital assessment, it is assumed that the enterprise needs ______ of its annual turnover as gross working capital, out of which _____ will be provided by the bank and _____ will be brought in as margin by the enterprise.


Options are :

  • 50%,25%,25%
  • 25%,20%,5% (Correct)
  • 30%,20%,10%
  • 10%,5%,5%

Answer :25%,20%,5%

Banks enter into a compromise with borrowers in case of default, because:


Options are :

  • Recovery through legal action is time-consuming
  • Adequate security is not available
  • Realization or security may be difficult
  • All the above (Correct)

Answer :All the above

CAIIB 2020 Advanced Bank Management Mock Tests Set 1

Which of the following statement is correct w.r.t. working capital finance to information technology and software industry? I) Banks may consider sanction of working capital limits based on the track record of the promoters. II) Banks can stipulate reasonable amount as promoters’ contribution towards margin. III) Banks may obtain collateral security wherever available IV) The banks could obtain quarterly statements of cash flows to monitor the operations.


Options are :

  • Only I
  • Only III
  • Only I,II and III
  • All of the above viz. I,II,III,IV (Correct)

Answer :All of the above viz. I,II,III,IV

The aim of a rehabilitation programme is:


Options are :

  • To make the operations of the enterprise viable again (Correct)
  • To help in employment generation
  • To comply with R B I guidelines
  • To increase bank's advances

Answer :To make the operations of the enterprise viable again

Which of the following is not an approach for assessment of credit risks, laid down under Basel 2 Accord? .


Options are :

  • Standardized approach
  • Foundation Internal Rating Based (I R B) approach
  • Advanced Internal Rating Based (I R B) approach
  • Simplified Internal Rating Based (I R B) approach (Correct)

Answer :Simplified Internal Rating Based (I R B) approach

CAIIB 2020 Retail Banking Mock Tests Set 6

Which of the following are some of the safeguards that RBI has advised to banks w.r.t. co-acceptance of bills? I) While sanctioning co-acceptance limits to their customers, the need therefore should be ascertained, and such limits should be extended only to those customers who enjoy other limits with the bank. II) Only genuine trade bills should be co-accepted and the banks should be ensure that the goods covered by bills co-accepted are actually received in the stock accounts of the borrowers. III) Co-acceptances in respect of bills for ?. 50,000/- and above should be signed by two officials jointly, deviation being allowed only in exceptional cases, e.g. non-availability of two officials at a branch. IV) The valuation of the goods as mentioned in the accompanying invoice should be verified to see that there should not be over-valuation of stocks more than 10% of the invoice value.


Options are :

  • Only I
  • Only I,II (Correct)
  • Only I,II and IV
  • All of the above viz. I,II,III,IV

Answer :Only I,II

For appraisal, the lender will normally depend on which of the following information - I) The background, credit history, market reports of the borrower.  II) The financial track record of the borrower as representing by the financial statements III)Techno-economic feasibility report of the activity of proposal IV) The influence of borrower in regional politics.


Options are :

  • Only I,II
  • Only I,III
  • Only I,II,III (Correct)
  • All of the above viz. I,II,III,IV

Answer :Only I,II,III

Select the INCORRECT sentence: 1. Term loans are provided for acquiring the fixed assets. 2. Working capital term loans are provided for sustaining current assets. 3. Term loan is payable as per demand. 4. Working capital term loans are payable as per repayment schedule


Options are :

  • both 1 and 2
  • both 2 and 3
  • both 3 and 4 (Correct)
  • both 1 and 4

Answer :both 3 and 4

CAIIB 2020 Retail Banking Mock Tests Set 15

While issuing guarantees on behalf of customers, which of the following safeguards should be observed by banks? I) At the time of issuing financial guarantees, banks should be satisfied that the customer would be in a position to reimburse the bank in case the bank is required to make payment under the guarantee. II) In the case of performance guarantee, banks should exercise due caution and have sufficient experience with the customer to satisfy themselves that the customer has the necessary experience, capacity and means to perform the obligations under the contract, and is likely to commit any default. III) Banks can give guarantee if borrower has some relation with any political leader or administrative Officer. IV) Banks should, normally, refrain from issuing guarantees on behalf of customers who do not enjoy credit facilities with them.


Options are :

  • Only I
  • Only III
  • Only I,II and IV (Correct)
  • All of the above viz. I,II,III,IV

Answer :Only I,II and IV

Return on equity using the traditional DuPont formula equals:


Options are :

  • (net profit margin) (interest component) (solvency ratio).
  • (net profit margin) (total asset turnover) (tax retention rate).
  • (net profit margin) (total asset turnover) (financial leverage multiplier). (Correct)

Answer :(net profit margin) (total asset turnover) (financial leverage multiplier).

Which of the following infrastructure sectors qualify under ‘infrastructure lending’? I) Electricity II) Transport III) Energy IV) water and Sanitation


Options are :

  • Only I
  • Only II,III,IV (Correct)
  • Only II
  • All of the above viz. I,II,III,IV

Answer :Only II,III,IV

CAIIB 2020 Bank Financial Management Mock Tests Set 11

For assessing the LC requirement of an enterprise, which of the following points should be remembered by a banker? I) Average Amount of Each LC is dependent on the monthly consumption of goods and the economic order quantity II) The number of LCs to be opened in a year can be calculated by dividing annual consumption by EOQ III) The time taken for one LC to remain in force depends upon the lead time, the transit time and the usance available to purchaser from the date of receipt of goods.


Options are :

  • Only I
  • Only I,II (Correct)
  • Only II
  • All of the above viz. I,II,III

Answer :Only I,II

Which of the following is a type of financing done by banks to the infrastructure sector? I) Take-out Financing II) Inter-institutional Guarantees III) Financing Promoter’s Equity IV)  Collaboration Financing


Options are :

  • Only I
  • Only I,II,III (Correct)
  • Only II
  • All of the above viz. I,II,III,IV

Answer :Only I,II,III

Seasonal working capital is


Options are :

  • Permanently required
  • Fluctuating in nature
  • Required to meet seasonal needs of the organization (Correct)
  • None of the above

Answer :Required to meet seasonal needs of the organization

CAIIB 2020 Advanced Bank Management Mock Tests Set 10

Which of the following is not a micro level action for mitigation of credit risk?


Options are :

  • Improving the sanctioning and delivering process
  • Obtention of collateral security
  • Monitoring and review of individual proposals/categories of proposals
  • Periodical reviews of the exposure limits for business or industry segment (Correct)

Answer :Periodical reviews of the exposure limits for business or industry segment

Shortage of working capital may result in


Options are :

  • Poor creditworthiness (Correct)
  • Higher trade discount
  • Higher cash discount
  • None of the above

Answer :Poor creditworthiness

The margin of safety is provided to


Options are :

  • Cover possible variations in estimation
  • Have safety in the management of working capital
  • Ensure safety in the estimation of working capital
  • Both B C (Correct)

Answer :Both B C

CAIIB 2020 Bank Financial Management Mock Tests Set 2

‘At the time of financing projects banks generally adopt which one of the following methodologies for determining the level of promoters’ equity ? I) Promoters bring their entire contribution upfront before the bank starts disbursing its commitment. II)Promoters bring certain percentage of their equity (40% - 50%) upfront and balance is bought in stages. III)Promoters agree, ab initio, that they will bring in equity funds proportionately as the banks finance the debt portion.


Options are :

  • Only I
  • Only I,II
  • Only III
  • All of the above viz. I,II,III,IV (Correct)

Answer :All of the above viz. I,II,III,IV

Which of the following is not a macro level action for mitigation of credit risk?


Options are :

  • Periodically reviews of the exposure norms for single and group borrowers
  • Improving appraisal standards of credit proposals (Correct)
  • Frequent reviews of norms and fixing internal limits for aggregate commitments to specific sectors of the industry or business
  • Periodic review of total credit portfolio based on quality parameters

Answer :Improving appraisal standards of credit proposals

Which of the following statements is correct w.r.t. syndication of loans? I) The term ‘Syndication’ is normally used for sharing a long-term loan to a borrower by two or more banks. II) This is a way of sharing the risk, associated with lending to that borrower, by the banks and is generally used for large loans. III) The borrower, intending to avail the desired amount of loan, gives a mandate to one bank (called Lead bank) to arrange for sanctions for the total amount, on its behalf. IV) The lead bank does the liaison work and common terms and conditions of sanction may be agreed in a meeting of participating banks, arranged by the lead bank.


Options are :

  • Only I
  • Only I,II
  • Only III
  • All of the above viz. I,II,III,IV (Correct)

Answer :All of the above viz. I,II,III,IV

CAIIB 2020 Advanced Bank Management Mock Tests Set 6

Which of the following statements is/are correct w.r.t. factoring ? I) This is a method of financing the receivables of a business enterprise. II) Banks are permitted to do this business through subsidiaries and also departmentally. III) Under factoring, the factor not only purchases the book debts/receivables of the client, but may also control the credit given to the buyers and administer the sales ledger. IV) The purchase of book debts/receivables can be done only without recourse to the clients.


Options are :

  • Only I
  • Only I,II,III (Correct)
  • Only II
  • All of the above viz. I,II,III,IV

Answer :Only I,II,III

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