BANKING AWARENESS PRACTICE MCQs

1. What is India's rank in this year's Global Peace Index (GPI) that measured peace in 162 countries? 
1) 141
2) 110
3) 132
4) 134 
5) 152


2. The Reserve Bank of India imposed fine on which of the following private sector banks for violation of KYC (Know Your Customer) norms in June 2013? 
1) Axis Bank 
2) HDFC Bank 
3) ICICI Bank 
4) Both 1 and 2 
5) All 1, 2 and 3 

3. Rafael Nadal of Spain won the French Open Men's Lawn Tennis Grand Slam title for a record 8th time. Whom did he defeat in the final in Paris in June 2013?
1) Roger Federer
2) Novak Djokovic 
3) David Ferrer
4) Andy Murray
5) Jo Wilfred Tsonga 

4. Who was appointed the United States National Security Adviser in June 2013? 
1) Samantha Power 
2) John McCain 
3) Lindsey Graham 
4) Susan Rice
5) John Kerry 


5. Who won her second French Open Women's tennis title in Paris on June 8, 2013?
1) Maria Kirilenko 
2) Maria Sharapova 
3) Jelena Jankovic 
4) Victoria Azarenka 
5) Serena Williams 

6. Who was re-elected as the Chairman of the Indian Banks' Association (IBA) for 2013-14 tenure in June 2013?
1) Aditya Puri 
2) Pratip Chaudhuri 
3) Rana Kapoor 
4) K.R.Kamath 
5) B.A.Prabhakar 

7. The headquarters of European Union is situated in which of the following countries?
1) UK
2) Germany 
3) France 
4) Belgium 
5) Netherlands 

8. The name 'Bluetooth' gets its name from a 10th century king of?
1) China
2) Denmark 
3) Greece
4) Thailand 
5) Spain 

9. Baglihar Dam is constructed on the river?
1) Chenab 
2) Raavi 
3) Indus 
4) Sutlej 
5) Beas 

10. Which country will host both the World Cup Football 2014 and Olympics 2016?
1) Russia 
2) USA 
3) Brazil 
4) Japan 
5) Germany 

11. Bharat Ratna was instituted in? 
1) 1954 
2) 1955 
3) 1961
4) 1969
 5) 1960

12. The present Pope chosen in March 2013 hails from?
1) Canada 
2) Mexico 
3) Brazil 
4) Argentina 
5) Uruguay 

13. 'Paradise Regained' was written by? 
1) John Keats 
2) Charles Dickens 
3) John Milton 
4) Oliver Goldsmith 
5) Lord Byron 

14. 'CRY' is an NGO which works for the welfare of?
1) Senior citizens
2) Cancer patients 
3) War victims 
4) Children 
5) AIDS patients

15. The USP of a Current account is?
1) High minimum balance 
2) No restrictions on transactions 
3) No interest payable 
4) Restricted deposits 
5) None of these

16. Leads for Home Loans can be obtained from?
1) Traders
2) Trusts 
3) Builders 
4) Cooperative societies 
5) None of these 


17. The target group for SME loans is?
1) Students 
2) Housewives 
3) Entrepreneurs 
4) Salaried persons 
5) Government undertakings

18. Which of the following terms is used in the field of finance and banking?
1) Metabolism 
2) Genetic process 
3) Centrifugal force 
4) Debt instrument 
5) Experimental error

19. The National Social Security Fund (NSSF) helps which of the following groups of society?
1) Bank employees 
2) Central government employees 
3) Workers in the unorganized sector 
4) Workers in the textile industry
5) Women employees 

20. Which of the following tools is used by the RBI to control credit and monetary situations of the markets?
1) RTGS 
2) NEFT 
3) ECS
4) CRR 
5) Balance of trade 

21. Which of the following countries is located in South America?
1) South Sudan 
2) South Korea 
3) Uganda 
4) Angola 
5) Uruguay 

22. Which of the following is the currency of Myanmar? 
1) Taka 
2) Dinar 
3) Kyat 
4) Yen 
5) Dollar 

23. Which of the following terms is not used in the field of Economics?
1) Net income 
2) Cost of project 
3) Flow of fund 
4) Balance sheet 
5) Cold chain

24. Reverse Mortgage scheme is designed keeping which of the following groups of society in consideration? 
1) Defense personnel 
2) Senior citizens 
3) Youngsters who just started earning 
4) Dependent women 
5) None of these 

25. What happens when an economy is in recession?
1) GDP growth slows down 
2) Unemployment rate rises 
3) Bankruptcies rise 
4) Both 1 and 2 
5) All 1, 2 and 3

26. Retail investors means which of the following types of stock market investors?
1) Mutual funds 
2) Corporate bodies 
3) Promoters of companies 
4) Individuals 
5) FIIs

27. Which of the following is not an agricultural commodity?
1) Cardamom 
2) Cumin 
3) Garlic 
4) Turmeric 
5) Sulphur 

Answers:

1) 1; 2) 5; 3) 3; 4) 4; 5) 5; 6) 4; 7) 4; 8) 2; 9) 1; 10)3; 
11) 1; 12) 4; 13) 3; 14) 4; 15)2; 16) 3; 17) 3; 18) 4; 19) 3; 20) 4;
21) 5; 22) 3; 23) 5; 24) 2; 25) 5; 26) 4; 27) 5;

BANKING AWARENESS PRACTICE MCQs

1.What is the full form of CRR as used in banking sector?
a) Crucial Reserve Rate
b) Cash Reserve Ratio
c) Current Reserve Ratio 
d) Core Current Ratio
e) None.

2.What is the full form of LAF as used in the banking world very frequently ?
a)Liquid Advances Finance
b)Liquidity Adjustment Facility
c)Legal Adjournment Formality
d)Local Advance Finance
e)Late Arrival of Finance

3.Where is the headquarters of International Monetary Fund?
a) Geneva
b) Paris
c) London 
d) Manila
e) Washington DC

4.Many Regional Rural Banks are given licence to open branches in small cities and towns. These licences are given by:
a)Cabinet Committee on economic affairs
b)Reserve Bank Of India
c) NABARD
d)Indian Banks Association
e)None of these

5. Which of the following organisations/agencies is not associated with the world of Banking and Finance?
a) SEBI
b) AMFI
c) RBI
d) ECGC
e) SPCA

6.Banks recover term loan from the parties in EMIs. What does the letter 'E' represent in the term?
a) Easy
b) Effective
c) Equated 
d) Essential
e) Economical

7.What is the Bank Rate at Present?
a) 2%
b) 4%
c) 8.25%
d) 8%
e) None of these

8.Which of the following is not a scheduled commercial bank?
a) IDBI 
b) AXIS
c) HDFC
d) NABARD
e) Kotak Mahindra Bank

9.Which of the following certainly is an effort in the direction of Financial Inclusion?
a) Internet Banking
b) Anywhere Banking
c) No-frills Account
d) Foreign Currency Accounts
e) All of these

10.Who amongst the following Padma Bhusan awardees is a famous Banker?
a) Azim H Premji
b) Kapila Vatsyayan
c) Chanda Kochhar
d) Waheeda Rahman
e) Brajesh Mishra

11.Which of the following Acts has specially been launched to facilitate banks in recovery of bad loans?
a) RBI Act
b) Banking Regulation Act
c) Companies Act 
d) Income Tax Act
e) SARFAESI Act

12.The financial assistance or loans of Rs. 10,000 by a bank to a very small borrower will be called?
a) Business Finance
b) Govt. Finance 
c) Micro Finance
d) Small Finance 
e) KYC finance

13.Who amongst the following cannot work as a Business Correspondent as given in the scheme launched by the banks ?
a) Kirana Store
b) Post Office
c) Self Help Group 
d) A Bank Officer
e) Co-operative Society

14. Some banks are financing big projects like construction of roads, bridges etc. Finacing such projects means banks are helping exactly in:
a) Infrastructural Development
b) Project Management
c) Developing core sector Industry
d) Financial Inclusion
e) All of these

15.As we know, a lot of new concepts are being used in the field of banking these days, which of the following is NOT one such concept/product directly associated with banks ?
a) RTGS 
b)SMS alert
c) Demat Account
d) ATM/Debit card 
e) Number Portability

16.Which of the following is NOT a Nationalised bank?
a) Union Bank of India
b) Central Bank of India
c) YES Bank
d) Syndicate Bank
e) Indian Bank

Answers:

1) b; 2) b; 3) e; 4) b; 5) e; 6) c; 7) c; 8) d; 9) c; 10) c; 
11) e; 12) c; 13) d; 14) a; 15) e; 16) c. 

BANKING AWARENESS PRACTICE MCQs

1. Indian Commercial Banks are categorized into: 
a) Public sector Banks 
b)Foreign Banks 
c) Private Sector Banks 
d) All of the above 
e) None 

2. Regional Rural Banks have been set up with the basic objectives of:
a) Providing credit to semi - urban & urban population 
b) Providing deposits facilities to farmers 
c) Providing credit & deposit facilities to rural areas 
d) providing credit, deposit and other banking facilities to people in rural areas 
e) None

3. _____ is raised in capital markets 
a) Funds through long term securities
b) Long term loans through Govt. securities 
c) medium term loans 
d) Short - term instruments
e) None

4. Interest on Government secu-rities on fixed basis is known as: 
a) Bank rate 
b) Coupon 
c) Prime Lending Rate 
d) Bench mark PLR 
e) None

5. __ was not nationalized in 1969: 
a) Punjab National Bank
b) Oriental Bank of commerce 
c) Bank of Baroda 
d) Union Bank of India 
e) None

6. In the first round 14 major banks with a liability base of ____ were nationalized: 
a) 10 crore or more 
b) 20 crore or more 
c) 50 crore or more 
d) 100 crore or more 
e) None

7. _____ do not attract TDS: 
a) Fixed deposits 
b) Reinvestment depositsc) NRO SB 
d) NRO FDR 
e) Recurring deposits 

8. SLR is maintained as a percentage of:
a) Time liabilities 
b) Demand liabilities
c) Time and Demand liabilities 
d) Gross time and demand liabilities 
e) Net demand and time Liabilities 

9. The maximum Statutory Liquidity Ratio to be maintained by banks is_____: 
a) 25% 
b) 30% 
c) 35% 
d) 40% 
e) None

10. CRR funds are kept by the Banks in ____: 
a) Cash in hand at branches 
b) Balance with other banks 
c) Balance in a special Account with RBI 
d) Funds in the currency chest 
e) None

11. An increase in CRR by RBI leads to: 
a) Decrease in deposit 
b) increase in deposit 
c) Increase in lendable resources 
d) Decrease in lendable resources 
e) None

12. When RBI reduce the CRR it results into: 
a) Decrease in deposit 
b) increase in deposit 
c) Increase in lendable resources 
d) Decrease in lendable resources 
e) None

13. What is meant by development Oriented banking? 
a) Infrastructure financing 
b) Extending loans to States, which are undevelopment 
c) Taking up the task of develo-pment of the economy by providing support to under privileged sections of the society 
d) All the above 
e) None

14. Principal functions of SIDBI: 
a) Promotion of SSI 
b) Finance of SSI 
c) Development of SSI
d) All the above 
e) None 

15. ____ heads and conducts the affairs of RBI: 
a) Central Board 
b) local board 
c) Regional board 
d) All of the above 
e) None

16. RBI Provides ____ for meeting day - to - day receipt and expenditure mismatch to both Central and State Governments. 
a) treasury bills 
b) Ways and Means advance 
c) date and securities 
d) All the above 
e) None

17. RBI known as lender of last resort because: 
a) It has to meet the credit need of citizens to whom no one else is willing to lend 
b) Banks lend to go to RBI as a last resort 
c) It comes to help banks in times of crisis 
d) All of the above 
e) None 

18. These days RBI uses Selective credit control measures rather infrequently because of: 
a) Deregulation of functions 
b) Autonomy given to banks 
c) Comfortable liquidity 
d) Reasonable inflation level 
e) All the above 

19. Which is incorrect with regard to powers of RBI: 
a) Holds cash reserve banks
b) Controls banking system through licensing 
c) Supervises Banking system through inspection 
d) None of the above 
e) All

20.Intervenes in markets to maintain the external value of the Indian rupee: 
a) Exporters 
b) Importers 
c) RBI 
d) IMF 
e) None

21. In India, forex rates are determined by: 
a) Importers b) Exporters 
c) RBI d) Ministry of commerce 
e) Demand and supply forces 

22. Regional Rural Banks were set up on the recommendations of:
a) Nariman committee 
b) Narasimham committee 
c) Gadgil committee 
d) Puri committee 
e) None

23. committee, launched the process of reforms of financial system in India: 
a) Gadgil committee 
b) Nariman committee 
c) Narasimham committee 
d) khanna Committee 
e) None

24. Which of the following can be categories as a Merchant Banking service? 
a) Consultancy on finance to a company 
b) Advance in capital structure 
c) Managing mergers 
d) Helping in finalizing take over 
e) All the above 

25. The instrument which provides proprietary interest in company and which entitles a person to dividend on profits, is called? 
a) Bond 
b) Share
c) Debenture 
d) Warrant
e) Any of the above 

26. Which of the following provides proper definition of a Mutual Funds? 
a) It is an association of members of public 
b) These members want to invest in financial instrument 
c) They want to invest in financial instrument assts of business sector 
d) All the above 
e) None 

27. Which of the following organisations/agencies works solely to monitor and arrange flow of agriculture credit in India?
a)NABARD
 b) SIDBI 
c) RBI 
d)SEBI 
e) None of these

28. The currency notes of which of the following denominations are not printed in India ?
a) Rs. 5 
b) Rs. 10 
c) Rs. 50
d) Rs. 2500
e) Rs. 1000

29. Which of the following is not the name of a bank functioning in India?
a) Central Bank of India
b) UCO Bank
c) Aegon Religare 
d) Dena Bank
 e) ICICI Bank

30. When banks accept a fixed sum of money from an individual for a definite term and pay on maturity with interest, the deposit is known as : 
a) Term Deposit 
b) Demand Deposit
c) Bond
 d) Mortgage
e) Advance. 

31. Which of the following terms NOT used in banking/finance related matters ?
a) Discount Rate
b) Letter of credit
c) Policy Rate
d) Exchange rate
 e) Base rate

32. Who amongst the following is the chief of SEBI?
a) Milind Bhave 
b) UK Sinha 
c) Shashikath Verma
d) Shyamala Gopinath
e) None of these

33. Which of the following is a leading electronic-payment tec-hnology firm?
a) Visa 
b) Max
c) BSE
d) Sensex
e) SWAP

34. Global Market means market of :
a) USA 
b) China
c) OPEC members
d) European union countries 
e) All major countries and their alliances

Answers:
1) d; 2) d; 3) a; 4) b; 5) b; 6) c; 7) e; 8) e; 9) d; 10) c; 
11) d; 12) c; 13) c; 14) d; 15) a; 16) b; 17) c; 18) e; 19) d; 20) c;
21) e; 22) b; 23) c; 24) e; 25) b; 26) d; 27) a; 28) d; 29) c; 30) a;
31) e; 32) b; 33) a; 34) e; 

BANKING AWARENESS TERMS

Nationalisation of Banks in India in Two stages: 

On 19th July 1969, 14 Private Sector Banks Nationalised In first Phase by Late Indira Gandhi, the then Prime Minister of India.
1) Allahabad Bank
2) Bank of Baroda
3) Bank of India
4) Bank of Maharashtra
5) Canara Bank
6) Dena Bank
7) Central Bank of India
8) Indian Bank
9) Indian Overseas Bank
10) Punjab National Bank
11) Syndicate Bank
12) Union Bank of India
13) United Bank of India
14) United Commercial Bank

On 15th April 1980, 6 Private Sector Banks Nation-alised in second phase.
1) Andhra Bank
2) Corporation Bank
3) New Bank of India - Merged With PNB in 1993
4) Oreintal Bank of Commerce - Global Trust Bank Merged with OBC.
5) Punjab and Sind Bank
6) Vijaya Bank

Important Bits:
1. Present RBI Governor is 
D. Subba Rao, I.A.S.
2. RBI Central Office Located at Mumbai.
3. Authority to Issue of Currency Notes into Circulation by 
Reserve Bank
4.Signature on Currency Notes by Governor of RBI.

5. Prouducts of Electronic Banking Innovation are -
A) Internet Banking
B) Electronic Funds Transfer
C) Offshore Banking
D) Mobile Banking
E) Smart Cards

6. Country's Largest Commercial Bank - State Bank of India.
7. NPA - Non-Performing Asset-
A loss to Bank or a bad debt.

8. Stale Cheque - A Cheque becomes Invalid from the date of Issue of 3 Months.

9. Negotiable Instruments are:- As per Negotiable Instrument Act, 1881, Promissory Note, Bill of Exchange and a Cheque.

10. State Bank of India Nationalised on - July 1st, 1955

11.State Bank Previously Know as - Imperial Bank of India.

12. RBI Functioning From: 
01-04-1935

13. Repo Rate - The Interest Rate Charged by RBI to Banks on Loans.

14. Reverse Repo Rate: The Interest Rate at which RBI borrows from other Banks.

15. BPLR - Bench Mark Prime Lending Rate Charged by a Bank to borrowers of Funds. 

Urban Cooperative Banks

The number of Urban Cooperative Banks (UCBs) whose license was cancelled in the last three yearsare, 31 in 2009-10, 12 in 2010-11 and 14 in 2011-12.

                 Reserve Bank of India (RBI), the licensing authority for UCBs announced in the Annual Policy Statement (2004-05) that no fresh proposals for new UCBs would be considered till a comprehensive policy including an appropriate legal and regulatory framework for the sector is put in place. There has been no change in the policy of RBI since then. An Expert Committee on the subject was constituted in April, 2010 which submitted its report to RBI in September, 2011.

                 RBI has, from time to time, taken a number of steps to strengthen the financial position of UCBs, which, inter alia, include ;-

·        Allowing merger of UCBs to encourage merger/amalgamation and to provide an avenue for non-disruptive exit route for weak UCBs;

·        Allowing UCBs to raise share capital;

·        Allowing financial restructuring of weak UCBs by conversion of deposits into equity;

·        Entering into MOU with State Governments/UTs and Central Government (for multi-State UCBs) to address the problem of dual control of UCBs by RBI and Registrar of Cooperative Societies; and

·        Setting up a Task Force on Urban Cooperative Banks in each State/UT with an objective to have a consultative arrangement for identifying weak and potentially viable entities and turning them around and also to provide a non disruptive exit path to unviable entities so as to ensure continuous process of monitoring of such UCBs

RBI directs Co-op banks to not grant loans for gold purchase

The RBI has directed State and Central co-operative banks not to give loans for purchase of gold in any form to curb the considerable increase in its import in recent years.

Currently, these banks are allowed to grant loans against pledge of gold ornaments, but not permitted to grant any advance for purchase of gold in any form. They offer loans for various purposes against the security of gold/gold ornaments as part of their lending policy.

Corporation Bank launches new variants of savings bank accounts

Corporation Bank has rolled out two new types of savings accounts namely SB Super and SB Signature.
A customer should maintain a minimum Quarterly Average Balance (QAB) of Rs 15,000 for SB Super and Rs 1 lakh for SB Signature.
Customers having any of the two accounts will be offered preferential loan processing. Both accounts offer bundled demat and trading account including a waiver of annual maintenance charges for the first year. They also bring concessions and offers like free NEFT, SMS banking, and 25 % concession in bank charges for gold coins.