1. Welcome to Jaiib Virtual Classroom Session October 08/2007 Principles of Banking – module b
Model questions

2. FCNR accounts FCNR accounts can be opened in the
following currencies except one:
a) United States Dollar
b) Canadian Dollar
c) Singapore Dollar
d) Australian Dollar

3. Banker-Customer Relations
One of your valued customer has handed
over a sealed packet, to be kept as a safe
custody item, with your bank. The relationship
between you (as banker) and your customer is:
a) Lessor and Lessee
b) Bailor and Bailee
c) Bailee and Bailor
d) Lessee and Lessor

4. Match the following i) Current Deposits A) Assets
ii) Term Loan B) Liabilities
iii) Funds Transfer C) RTGS
Iv) Bancassurance D) IRDA
a) i-A,ii-B,iii-C,iv-D
b) i-B,ii-A,iii-D,iv-C
c) i-A,ii-B,iii-D,iv-C
d) i-B,ii-A,iii-C,iv-D

5. Negotiable Instruments
State which of the following is/are incorrect:
i)Crossing is applicable to a Bill of Exchange.
ii)Paying banker gets protection only for payment of a bearer cheque.
iii)A Materially altered cheque is a negotiable instrument.
iv)The drawee of a cheque can issue a stop payment instruction.
i,ii
i,ii,iii
i,iii,iv
i,ii,iv

6. Types of Charges Which charge/s need not be registered with the ROC:
Hypothecation
Pledge
Mortgage
Both a and c

7. Mutual Funds The regulator for Mutual Funds in India is: a) RBI
b) SlDBI
c) SEBI
d) FIMMDA

8. Credit Appraisal
While appraising a credit proposal and sanctioning a line of credit to their clients, banks usually apply the concepts popularly known as 6 Cs, representing Character/Capital/Capacity/Collateral/Condition and Compliance.
Your bank while sanctioning a cash credit limit to one of your customers, informs the customer, that the customer needs to submit monthly stock statements. This requirement can be
classified as :
a) Capacity
b) Condition
c) Character
d) Capital

9. Funds Transfer Which is not an example of electronic funds transfer:
RTGS
EFT
MICR
ECS

10. Non Fund Based Limits Which one of the following is not a
non fund based limits, extended by banks:
a) Letters of Credit
b) Bank Guarantee
c) Trust Receipt
d) Co-acceptance of Bills

11. The diagram is called as: a)Cash flow cycle d)Work flow cycle c))Working Capital Cycle d) Trade Cycle

12. Cheques
In the inward clearing your bank receives a cheque, without the account holder’s
signature for Rs Two lakhs. Which reason
you will select to return the cheque?
a) Cheque is not signed by the drawee
b) Cheque is not signed by the payee
c) Cheque is not signed by the payee
d) Refer to the drawer

13. Garnishee Order
Bank A receives a Garnishee Order attaching funds of customer XYS Ltd. At the time of receipt of the order, the various
accounts of XYS Ltd, showed:
i) Cash Credit a/c - Rs. 23, (cr)
ii) Over Draft a/c - Rs. 10,001.11(dr)
iii) An overdue Fixed Deposit a/c for Rs.1,00,000.00
Identify which account/s is/are attachable under the garnishee order
a) i and ii
b) i and iii
c) ii and iii
d) iii

14. Types of accounts
Either or Survivor (the operating instructions) can not be applicable to which of the following accounts:
i) SB account of Mr.A, where Mrs.A is a nominee
ii) Saravana Cooperative Housing Society maintains a current account,operated by the Secretary and President
iii) ABJ Ltd, places Rs.Two crores as Fixed deposit for 6 months.
a) i and iii
b) i,ii and iii
c) ii and iii
d) i

15. Bancassurance Bancassurance is:
a) An insurance scheme to insure bank deposits
b) A post office insurance scheme marketed
by banks and insurance companies
c) A composite financial service offering both
bank and insurance products
d) An innovative insurance product introduced
by an insurance company.

16. Type of Facility Your Bank has granted an overdraft
against book debts. The charge is:
a) Hypothecation
b) Pledge
c) Assignment
d) Mortgage

17. ALL THE BEST & THANK YOU T.M.C.VARADARAJAN TEL : 022-25638965 (R)
e.mail:

18. Answers FCNR accounts – C Banker Customer Relations – C
Match the following – D
Negotiable Instruments – D
Type of Charges – B
Mutual Funds – C
Credit Appraisal – B

19. Answers Funds Transfer – C Non Fund Based Limits – C Diagram – C
Cheques – D
Garnishee Order – B
Type of accounts - B
Bancassurance – C
Type of Facility – C