Which of the following statement is not correct regarding

importance of credit?

Credit enables the consumer to spend more than what

they would have spent otherwise.

Increased demand induces the producer to produce

more and leads to increase in GDP

Excessive availability of credit for unproductive

purpose, does not affect the inflationary pressure in

any manner.

RBI makes uses of monetary tools to regulate the credit

Tradiotionally, the private money landers played an

important role in meeting credit needs of Individuals in

India, particularly in rural areas.

After nationalization of banks BRI was able to exercise

more control on the banks in credit matters

Which of the following is not an important principle of

credit?

Purpose of credit

Risk spread

Safety of funds

None of above

The different type of borrowers are regulated under

different Law. Which of the following does not match in

this context:

Partnership Act –Indian Partnership Act 1932

Companies – Companies Act 1956

Individuals -Limitation Act

Cooperative Societies – Co-Op Societies Act of Socities

Registration Act

Which of the following statement is not correct:

Credit can be fund based or non fund based

In case of fund based loans, there is actual transfer of

funds

In case of non fund based loans, the transfer of

funds never takes place

A bank guarantee falls under the on fund based

category

Which of the following is not a form of on funds based

commitment on the part of the bank

Letter of credit and bank guarantee

Co-aceptance

Forward contracts and other derivaties

None of the above

Banks have to report their business for public reporting

purpose, based on the geographical segments as:

Domestic transactions and international

transactions

Rupee transactions and foreign currency transaction

Banking business transactions and non banking

business transaction

All the above

The retail banking segment is one that fulfills the

following criteria

A] Orientation criterion

B] product criterion

C] Granularity criterion

D] low value of individual exposure

As per orientation criterion for retail banking segment,

the exposure should be to individuals or small business.

The small business for this purpose is one, where the

annual turnover is less than:

Rs. 50 crores

As per granularly criterion for retail banking segment,

the agreegate exposure to one counterparty should not

exceed:

0.2% of the overall retail potfolio

The loan policy of bank is framed by

Individuals bank for themselves

Which is the following factors influence the formulation

of the loan policy

A] market condition

B] loan policy of the other banks

C] RBI guidelines

D] government policy

All of above

The loan policy of a bank normally covers the guidelines

on the following aspects:

Exposure limits for single and group borrowes

Exposure limits for different industries, activities etc.

Discretionary loaning powers for sanctioning of credit

proposal, at various level

All of above

Which of the following is part of loan delivery process in

a bank?

Documentation only

Documentation and creation of charge over securities

only

Documentation, creation of charge over securities,

method of delivery onl

Documentation, creation of charge over securities,

method of delivery and procedure for disbursement

Which of the following activity is not a category of

priority sector lending:

Agriculture

SME

Retail trade & education loan

Micro credit and House loans

Which among the following is correct for overall priority

sector lending target for banks:

For domestic banks and foreign banks with 20 or more

branches it is 40% and for foreign banks with less than

20 branhes it is 32% of ANBC or credit equivalent of of-

balance sheet exposure, whichever is higher

Within the prority sector lending targets for indirect

agriculture, which of the following is not correct:

It is maximum 4.5% ANBC or creit equivalent of off-

balance sheet exposure whichever is higher

It is restricted to 4.5 % of total agriculture advances

Lending beyond 4.5% of ANBC will not be taken into

account for computing 18% lending to agriculture

All indirect agriculrure advances will be taken as part of

priority sector lensing

Lending target for weaker section within the priority

sector are 10% of ANBC or creit equivalent of off

balance sheet exposure whichever it higher OR 25% of

PSL

Farmers cab be granted post harvet loans against

hypothecation or pledge or warehouse receipt for an

amount upto Rs. 25 lacs upto 12 months

Which of the following is not correct in connection with

PSL target for MSE:

For domestic banks, the overall target is 10% of

ANBC or credit equivalent of off balance sheet

exposure whichever is higher

Number of micro enterprise loan accounts to increase

10% annually

Within MSE lending, minimum 60% should be given to

micro enterpreise

Within MSE leaning 40% can be given to small

enterprise

Which of the following is correct with regard to lending

targets for export credit:

For Indian banks there is no target and foreign banks it

is 12% of ANBC

For Indian banks it is 10% of ANBC and foreign banks it

is 12% of ANBC

There is no specific target for export credit

For Indian banks there is no target within priority sector

although it is 10% of ANBC and foreign banks it is 10%

of ANBC within PSL

MSE (Service), engaged in providing services fulfilling

the investment criteria as per MSME Development Act

2006 can be allowed loan upto Rs. 1 crores to be

classified as direct MSE advance

Housing Unit (per family) for purchase or construction of

house, upto Rs. 25 lacs sanctioned in metropolitan

centres, can be classified as Housing Loans under PSL

For banks, which of the DRI target is not correct:

The target is applicable both for domestic banks

and foreign banks

40% of DRI loans should be to SC or ST

Two third of DRI loans should eb disbursed through

rural and semi urban branches of banks

There is no overall specific target

For a small enterprise in servicing, which of the

following investment criteria is correct:

Investment in equipment above Rs. 10 lac but upto

Rs. 2 crores

For a micro enterprise which of the following investment

criteria is correct:

Investment in equipment upto Rs. 10 lacs ad in P&M

upto Rs. 25 lacs

All advances granted to units in KVI sector irrespective

of size of operation, location and amount of original

investment in P&M are considered as:

Advances to micro enterprise for 60% within MSE

Housing loans (per family) for repair to the damaged

dwelling units can be classified as housing loan under

priority sector if the loan amount is upto Rs. 5 lacs in

urban and metro centers

Education loan can be allowed by a bank to the

following extent (which one is correct):

Education in India Rs. 10 and Education abroad Rs.

20 laces

Maximum ceiling on amount of loan given to input

dealer does not match in which of the following case:

Fertilizer delaer upto Rs. 1 crores

Poultry feed and cattle feed dealer upto Rs. 1 crroes

Agriculture machinery and irrigation equipment upto Rs.

1 croreos

None of above

A cooperative society of farmers to dispose off the

produce of the farmers, can be allowed maximum loan

of Rs. 5 crores as Indirect advances to agriculture.