JAIIB Legal & Regulatory Aspects Of Banking Mock Test Set 8

Which of the following is the important provision in respect of immovable property which is subject to encumbrances


Options are :

  • The secured creditor shall vest in the transferee all the right as it the transfer had been made by the borrower
  • All encumbrances know to secured creditor must be disclosed in the advertisement
  • The Authorised officer may allow the purchaser to deposit with him the money required to discharge the encumbrances
  • All the above

Answer :All the above

JAIIB Legal & Regulatory Aspects Of Banking Mock Test Set 9

What are the provisions for appointment of manager for secured Assets: 


Options are :

  • the Board of Directors of secured creditor may appoint a manager in consultation with the borrower to manage secure assets
  • The manager will be deemed to be an agent of borrower
  • The borrower solely would be responsible for the acts of manager.
  • All the above

Answer :All the above

Wich of the statements is correct in the context of charges: 


Options are :

  • hypothecation is defined in Indian Contract Act
  • pledge is defined in Transfer of property Act
  • in mortgage, interest in specific immovable property is transferred to secure a loan
  • in pledge the possession is with the borrower and ownership with the bank

Answer :in mortgage, interest in specific immovable property is transferred to secure a loan

If a partners becomes insolvent and the account is in debit, the bank stops the payment to avoid: 


Options are :

  • Application of right of set off
  • Application of rule of subrogation
  • Application of rule in Clayton case
  • Application of rule in redemption

Answer :Application of rule in Clayton case

JAIIB Accounting and Finance for Bankers Mock Tests Set 1

What is the role of qualified Institution Buyers in the securitization process? 


Options are :

  • The qualified investors would invest in the Financial Asset Scheme.
  • The securitized company issues Security Receipts to qualified investors
  • The security receipt represents undivided interest in the Financial Asset.
  • The securitized company will realize Financial Assets and redeem the investment.

Answer :The qualified investors would invest in the Financial Asset Scheme.

Letter of Credit where in addition to advance payment, the beneficiary is entitled to payment of storage charges is called  


Options are :

  • LC
  • Red clause credit
  • Yellow clause credit
  • Green clause credit

Answer :Green clause credit

Can  a  customer  from  whose  account  fraudulently  someone  has  withdrawn  money  make  complaint before the Banking Ombudsman


Options are :

  • No, as the offence committed is of criminal nature FIR with police has to be filed.
  • Yes, but if the police authorities who have received FIR permit filing of complaint with Ombudsman
  • Yes, as this aspect comes under the powers of Banking Ombudsman
  • No, as the loss caused to the customer is of a civil nature for recovery, civil suit is required to be filed

Answer :Yes, as this aspect comes under the powers of Banking Ombudsman

JAIIB Accounting and Finance for Bankers Mock Tests Set 10

Once  the  dispute  before  the  Banking  Ombudsman  is  referred  to  arbitration  can  new  claim  or counterclaim be made? 


Options are :

  • No, as the reference on the issues has already been made
  • Yes, provided the claim and counterclaim are within the terms of reference.
  • Yes, provided additional stamp duty is paid thereon.
  • No, because arbitration is by mutual consent so stage of claim and counter claim does not arise.

Answer :Yes, provided additional stamp duty is paid thereon.

Section 5(b) of ...... Act gives the definition of the term ‘Banking’ 


Options are :

  • Contract Act
  • Negotiable Instruments Act
  • Banking Regulation Act
  • Transfer of Property Act

Answer :Banking Regulation Act

Whereas general lien gives right to retain goods, Banker’s lien has ...... in case of default. 


Options are :

  • right to create charge
  • right to create mortgage
  • right to sell
  • None of these

Answer :right to sell

JAIIB Accounting and Finance for Bankers Mock Tests Set 11

Bank – B made a payment of a cheque which later on was found to be materially altered, when the cheque was examined through ultra violet lamp, bank had exercised due care while making the payment but alternation was not visible: 


Options are :

  • Bank is liable for material alternation
  • Bank is liable as it failed to examine the cheque through advance technology which was available with the bank at the time of payment
  • Bank is not liable and gets protection u/s 89 of NI Act as the alternation was not visible.
  • Bank is not liable since bank cannot provide ultra-violet lamp at all branches

Answer :Bank is not liable and gets protection u/s 89 of NI Act as the alternation was not visible.

Complaint can be made by a customer to Ombudsman when (a) ban rejects customer’s complaint (b) bank sends reply and customer is not satisfied (c) customer lodged complaint and bank sends no reply for one month (d) bank asks the customer to refer the matter to Ombudsman. Which of the following options is correct in the above connection: 


Options are :

  • A, b ,d
  • A, b, c
  • B, c, d
  • A, c, d

Answer :A, b, c

Can the Banking Ombudsman resolve the dispute between banks or between bank and its customer by arbitration reference? 


Options are :

  • No, the Banking Ombudsman has no arbitral powers.
  • Yes, if Banking Ombudsman himself feels and decides to so.
  • No, as the Banking Ombudsman has no powers of Civil Court.
  • Yes, if both the parties to the complaint agree for the same.

Answer :Yes, if both the parties to the complaint agree for the same.

JAIIB Accounting and Finance for Bankers Mock Tests Set 12

What are the features of asset Reconstruction?  


Options are :

  • The Right or interest of any Bank is acquired for the purpose of realization of such assets.
  • Non-performing assets alone can be acquired for asset re-construction.
  • The assets can be acquired by the Asset Reconstruction Company by issuing Debentures and Bonds or entering into an arrangement with the Bank.
  • All the above

Answer :All the above

Banks are required to make payment of guaranteed amount once the guarantee is invoked by the beneficiary. There are two exception to this rule (a) case of fraud (b) special equity in favour of debtor (c) when applicant refuses to honour (d) when the beneficiary does not give the reasons for invocation and proof of bank’ liability: 


Options are :

  • Only a and b
  • Only b and c
  • Only a and c
  • Only b and d

Answer :Only a and b

The guarantees are following types :  


Options are :

  • Financial Guarantee
  • Performance Guarantee
  • Deferred Payment Guarantee
  • All of these

Answer : All of these

JAIIB Accounting and Finance for Bankers Mock Tests Set 13

Where a guaranteed debt has become due and surety has paid all that he is liable for, he invested with all the rights which the creditor had against the principal debtor. This means, on payment of the guaranteed debt, the surety steps into the shoes of the creditor. This right of the surety is known as :  


Options are :

  • Right to indemnity
  • Right of subrogation
  • Right to equities
  • Right of set-off

Answer :Right of subrogation

A contract between the creditor and the principal debtor by which the creditor makes a composition with, or promise to give time to, or not to sue the principal debtor :       


Options are :

  • Does not discharges the surety
  • Discharges the surety
  • Discharge the surety, unless the surety assets to such a contract
  • None of the above.

Answer :Discharge the surety, unless the surety assets to such a contract

Under Scale of Goods Act, which of the following is not correct: 


Options are :

  • Goods include share, stocks but not actionable claims
  • In an agreement to sell, the ownership is yet to transfer to the buyer
  • In case of sale, the risk in goods is with the seller and in case of agreement to sell, it is with the buyer
  • A contract of sale of goods is a bilateral contract

Answer :In case of sale, the risk in goods is with the seller and in case of agreement to sell, it is with the buyer

JAIIB Accounting and Finance for Bankers Mock Tests Set 14

C let some goods to P under a hire-purchase agreement, S guaranteed the instalment payable under the agreement. On the instalments bein in arrear, C determined the contract and seized the goods and then sued S on his guarantee :


Options are :

  • as C had determined the contract, he could not recover from S.
  • as C had determined the contract, he could recover from S.
  • as C had not determined the contract, he could not recover from S.
  • as C had not determined the contract, he could recover from S.

Answer :as C had determined the contract, he could not recover from S.

In the above problem there is an agreement which contemplates the principal debtor P, the creditor C and the surety S. The relationship is best described as under


Options are :

  • As between C and P, there is a contract out of which the guaranteed debt arises
  • As between S and C, there is a contract by which s guarantees, to pay P's debt in case of his (P's)
  • As between S and P, there is contract that P shall indemnify S in case S pays in the event of a default
  • All the above

Answer :All the above

A 'fidelity guarantee' is one in which the guarantee is given for :       


Options are :

  • the repayment of a debt
  • the payment of the price of the goods sold on credit
  • the good conduct of honesty of a person employed in a particular office
  • (a) and (b).

Answer :the good conduct of honesty of a person employed in a particular office

JAIIB Accounting and Finance for Bankers Mock Tests Set 15

A contract by which one party promises to save the other from loss caused to him by the conduct of the promisor himself, or by the conduct of any other person is called :    


Options are :

  • contract of indemnity
  • contract of guarantee
  • contract of agency
  • contract of warranty

Answer :contract of indemnity

A and B go into a shop. B says to the shopkeeper, 'Let him (A) have the goods, I will see you paid' The contract is one of :       


Options are :

  • contract of guarantee
  • contract of indemnity
  • contract of surety
  • contract of agency

Answer :contract of indemnity

A and B claim certain goods from a railway company as rival owners. A takes delivery of the goods by agreeing to compensate the railway company against loss in case B turns out to be the true owner. There is a contract of indemnify between :


Options are :

  • A and B
  • B and the railway company
  • A and the railway company
  • B and A

Answer :A and the railway company

JAIIB Accounting and Finance for Bankers Mock Tests Set 2

An indemnity holder is entitled to recover from the promisor ; i.e., the indemnifier :   


Options are :

  • All damages which he may be compelled to pay in any suit in respect of any matter to which the promise to indemnify applies
  • All costs which he may be compelled to pay in bringing or defending such suits
  • All sums which he may paid under the terms of an compromise of any such suit
  • All the above

Answer :All the above

A letter of credit is an undertaking given by the buyer's bank to the seller bank to honor the documents drawn by seller if :      


Options are :

  • these are in strict compliance with the terms and conditions stipulated in the letter of credit.
  • these are acceptable to the buyer
  • the goods contained in the transaction are of good quality
  • adequate funds are provided by the buyer

Answer :these are in strict compliance with the terms and conditions stipulated in the letter of credit.

It is an arrangement, whereby a bank (issuing bank) acting at the request and in accordance with the instruction given by the customer (opener/applicant for the credit) is to make payment to or to the order of a third party (beneficiary/seller) or is to pay accept negotiable bills of exchange drawn by the beneficiary or authorizes such payment to made or such drafts to be accepted or negotiated by another banks. what is it known as :      


Options are :

  • a Letter of Indemnity
  • a Bank Guarantee
  • a Letter of Credit defined under UCPDC
  • None of the above.

Answer :a Letter of Credit defined under UCPDC

JAIIB Accounting and Finance for Bankers Mock Tests Set 3

The branch/correspondent of opening bank that forwards the LC to the seller after confirming apparent geniuses of instruments and verifying the signature thereon is known as :       


Options are :

  • Opening Bank
  • Advising Bank
  • Negotiating Bank
  • Reimbursing Bank

Answer :Advising Bank

Bank _ B allowed a cash credit advance to a party which is guaranteed by G. Such guarantee a series of transactions is called: 


Options are :

  • Unlimited liability guarantee
  • Deferred payment guarantee
  • Continuing guarantee
  • Performance guarantee

Answer :Continuing guarantee

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