FINAL ANSWER KEY
Paper: Elements of Banking - I PAPER
Date of
Examination
04-09-2019
Question1:-RBI (Reserve Bank of India) was started in the year
A:-1949
B:-1935
C:-1934
D:-1947
Correct Answer:- Option-B
Question2:-The Indian Bank Act was passed in ___________ to bring banks with in the ambit of the Reserve Bank. A:-1938
B:-1939
C:-1949
D:-1947
Correct Answer:- Option-B
Question3:-The Head Quarters of RBI is at
A:-Mumbai
B:-New Delhi
C:-Chennai
D:-Bangalore
Correct Answer:- Option-A
Question4:-The RBI issued its own bank notes in
A:-January 1938
B:-February 1939
C:-January 1939
D:-March 1939
Correct Answer:- Option-A
Question5:-The main source of profit of a bank
A:-Commission
B:-Interest
C:-Penal Interest
D:-Service charge
Correct Answer:- Option-B
Question6:-Credit Information Bureau (India) Ltd CIBIL was established to obtain and share data on A:-Deposits
B:-Financial intermediaries
C:-Borrowers
D:-All of the above
Correct Answer:- Option-C
Question7:-Which of the following is not an agency service of banks
A:-Sale of Insurance
B:-Mutual fund
C:-Govt. business
D:-Safe custody of valuables
Correct Answer:- Option-D
Question8:-In 1996 Reserve Bank became a member of
A:-IMF
B:-European economic community
C:-Bank for international settlement
D:-ADB (Asian Development Bank)
Correct Answer:- Option-C
Question9:-Long term financial soundness of a bank is called
A:-Liquidity
B:-Solvency
C:-Viability
D:-Profitability
Correct Answer:- Option-B
Question10:-Agriculture Refinance Corporation was set up in July 1963, as a subsidiary of
A:-RBI
B:-NABARD
C:-SBI
D:-NCDC
Correct Answer:- Option-A
Question11:-No of banks nationalised in the year 1969 by Government of India
A:-6
B:-8
C:-10
D:-14
Correct Answer:- Option-D
Question12:-Which one is not a Nationalised Bank?
A:-Canara Bank
B:-Indian Overseas Bank
C:-HDFC Bank
D:-Dena Bank
Correct Answer:- Option-C
Question13:-Banking through internet, ATM and smart cards is called
A:-Virtual Banking
B:-e-Banking
C:-Modern Banking
D:-None of these
Correct Answer:- Option-A
Question14:-1961, the failure of two commercial banks, led to deliberations on the need for deposit insurance. The banks are A:-Lakshmi bank and Nedungadi Bank
B:-Palai Central Bank and Cochin Bank
C:-Nedugadi Bank and Cochin Bank
D:-Palai Central Bank and Lakshmi Bank
Correct Answer:- Option-D
Question15:-___________ came into existence in June 1964 with the Reserve Bank wholly contributing the capital of Rs. 10 crores. A:-NCDC
B:-UTI
C:-IDBI
D:-ICICI
Correct Answer:- Option-C
Question16:-The first insurance company was started in India in 1818 at
A:-Chennai
B:-Mumbai
C:-Kolkata
D:-New Delhi
Correct Answer:- Option-C
Question17:-According to section 49 of the __________ Act the bank rate is defined.
A:-RBI Act
B:-BR Act
C:-Indian Paper Currency Act
D:-None of the above
Correct Answer:- Option-A
Question18:-In bank guarantee, the number of parties involved in the agreement are
A:-two
B:-many
C:-one
D:-three
Correct Answer:- Option-D
Question19:-Factoring Service means
A:-Collection of bills
B:-Discounting of bills
C:-Maintenance of account books
D:-All of the above
Correct Answer:- Option-D
Question20:-In 1921, three banks viz the bank of Bengal, the bank of Bombay, the bank of Madras were amalgamated into one bank which is A:-SBI
B:-RBI
C:-IOB
D:-None of these
Correct Answer:- Option-A
Question21:-MICR code consists of ___________ digit.
A:-9
B:-8
C:-6
D:-10
Correct Answer:- Option-A
Question22:-Which of the following loan is exempted from __________ provisioning norms.
A:-Gold loan
B:-Loans against NSC
C:-Mortgage loan
D:-All of the above
Correct Answer:- Option-B
Question23:-A bank is prohibited from doing any business other than those mentioned in section _______ of BR Act 1949. A:-5
B:-8
C:-6
D:-7
Correct Answer:- Option-C
Question24:-Bank established under Section 3 of National Housing Bank Act
A:-National Housing Federation
B:-National Housing Board
C:-National Housing Bank
D:-None of these
Correct Answer:- Option-C
Question25:-"No. Company other than a banking company shall use a part of its name any of the words 'bank', 'banker' or 'banking'"- Concerned section in B.R. Act
A:-3
B:-5
C:-6
D:-7
Correct Answer:- Option-D
Question26:-Section 27 of B.R. Act says
A:-Power to publish information
B:-Audit
C:-Monthly returns and power to call for other returns and informations D:-Powers of RBI
Correct Answer:- Option-C
Question27:-Industrial Development Bank delinked by RBI in _________. A:-1974
B:-1976
C:-1977
D:-1979
Correct Answer:- Option-B
Question28:-Banking Ombudsman scheme in banking sector was introduced in the year A:-1994
B:-1995
C:-2004
D:-2005
Correct Answer:- Option-B
Question29:-Capital Reserve is
A:-Depreciation made for fixed assets
B:-Dividend payable on paid up share capital
C:-Surplus arising out of sale proceeds of assets
D:-Reserve made for purchase of capital assets
Correct Answer:- Option-C
Question30:-Which of the following reserve is not considered for computation of net worth A:-Statutory Reserve
B:-Building fund
C:-Bad debt Reserve
D:-Dividend Equalization Fund
Correct Answer:- Option-B
Question31:-Scheduled banks are listed in the second schedule of
A:-BR Act 1949
B:-Reserve Bank of Indian Act 1934
C:-NI Act 1881
D:-NABARD Act 1981
Correct Answer:- Option-B
Question32:-'Banking Company' is defined as per section __________ of BR Act 1949. A:-5(a)
B:-5(b)
C:-5(c)
D:-5(d)
Correct Answer:- Option-C
Question33:-The Bankers Bank is
A:-NABARD
B:-State Bank of India
C:-Union Bank of India
D:-Reserve Bank of India
Correct Answer:- Option-D
Question34:-The largest portion of bank liabilities is
A:-Paid up share capital
B:-Own funds
C:-Deposits
D:-Borrowings
Correct Answer:- Option-C
Question35:-In India the financial section reforms started during A:-1989-90
B:-1991-92
C:-1993-94
D:-1975-76
Correct Answer:- Option-B
Question36:-Chairman of CRAFICARD committee
A:-Narasiham Committee
B:-B. Sivaraman Committee
C:-Gorwala Committee
D:-R.G. Surayya Committee
Correct Answer:- Option-B
Question37:-IFCI was setup in the year (Industrial Financial Cooperation of India) A:-1955
B:-1949
C:-1948
D:-1935
Correct Answer:- Option-C
Question38:-The lead Bank Scheme was started on the basis of A:-R.G. Surayya Committee
B:-Gadgil
C:-Nariman
D:-AIRCRC
Correct Answer:- Option-C
Question39:-Upto 1956 India follows _________ system of note issue. A:-Fixed monitory
B:-Maximum fiduciary
C:-Minimum Reserve
D:-Proportional Reserve
Correct Answer:- Option-D
Question40:-Which one is not a private bank?
A:-ICICI Bank
B:-HDFC Bank
C:-Global Trust Bank
D:-Bank of Baroda
Correct Answer:- Option-D
Question41:-Which of the following is general utility service of commercial banks? A:-Issue of letter of credit
B:-Foreign exchange
C:-Remittance of funds
D:-All of the above
Correct Answer:- Option-D
Question42:-A subsidiary of SBI recently merged with it
A:-Bank of Maharashtra
B:-The Allahabad Bank
C:-The Syndicate Bank
D:-State Bank of Travancore
Correct Answer:- Option-D
Question43:-Fastest economical and secure mode of fund transfer A:-Letter
B:-Issue of Demand Draft
C:-Couriers
D:-Banking network
Correct Answer:- Option-D
Question44:-Method of fund transfer
A:-NEFT
B:-RTGS
C:-UPI
D:-All of the above
Correct Answer:- Option-D
Question45:-Integration of short term and long term structure was recommended by A:-Hazari Committee
B:-Bawa Committee
C:-Khusro Committee
D:-Gorwala Committee
Correct Answer:- Option-A
Question46:-The lead Bank was introduced in
A:-1950
B:-1956
C:-1965
D:-1969
Correct Answer:- Option-D
Question47:-Bankers lien is an account
A:-Implied pledge
B:-Agreement
C:-Bailment
D:-An stoppage
Correct Answer:- Option-A
Question48:-Government of India lastly announced demonetization on A:-1st November 2016
B:-8th November 2016
C:-16th November 2016
D:-30th November 2016
Correct Answer:- Option-B
Question49:-Right to combine two accounts by bank is called
A:-Garnishee
B:-Lien
C:-Rating
D:-Set-off
Correct Answer:- Option-D
Question50:-Garnishee order is issued by a
A:-Revenue officers
B:-EID
C:-Courts of law
D:-Police officer
Correct Answer:- Option-C
Question51:-Operation risk is the risk arising from various types of
A:-Human error
B:-Failed system and procedure in the bank
C:-Bread down in international control
D:-All of above
Correct Answer:- Option-D
Question52:-The original name of Present Kerala State Coop Bank
A:-Trivandrum Central Co-op Bank
B:-Travancore 'Central Co-op Bank
C:-Travancore Cochin Central Co-op Bank
D:-None of these
Correct Answer:- Option-C
Question53:-The present chairman of NABARD
A:-Dr. Prakash Bakshi
B:-Harshkumar Bhanwala
C:-Y.S.P. Thorat
D:-B. Viswanathan
Correct Answer:- Option-B
Question54:-Model Cooperative law was recommended by
A:-Ch. Brahma Prakash
B:-Narasimham
C:-V.L. Metha
D:-Prakash Bakshi
Correct Answer:- Option-A
Question55:-A 'Cheque' is defined in section __________ of negotiable instrument Act 1881.
A:-Section 6
B:-Section 5
C:-Section 4
D:-Section 3
Correct Answer:- Option-A
Question56:-_________ is an instrument in writing containing an unconditional order signed by the maker directing a certain person to pay a certain sum of money.
A:-A bill of exchange
B:-Cheque
C:-Promissory note
D:-None of these
Correct Answer:- Option-A
Question57:-'Holder in due course' dealt with section ________ of NI Act 1881.
A:-Section 10
B:-Section 9
C:-Section 11
D:-Section 12
Correct Answer:- Option-B
Question58:-Section 138 of NI Act deals with
A:-Dishonour of cheque for insufficiency of funds in the account
B:-Offence by companies
C:-Instruments made out of India
D:-None of these
Correct Answer:- Option-A
Question59:-Section 124 of NI Act says about
A:-Cheque crossed generally
B:-Cheque crossed specially
C:-Crossing after issue
D:-None of these
Correct Answer:- Option-B
Question60:-Forged cheque is an __________ cheque.
A:-Post - dated
B:-Stale cheque
C:-Invalid
D:-Anti-dated
Correct Answer:- Option-C
Question61:-The person cannot open a SB account in a bank is A:-Company
B:-Blind person
C:-Minor
D:-Illiterate person
Correct Answer:- Option-A
Question62:-DTC stands for
A:-Direct Tax Co-operative
B:-Direct Tax Code
C:-Direct Tax Corporation
D:-None of the above
Correct Answer:- Option-B
Question63:-A cheque which is torn into pieces is called
A:-Post-dated
B:-Anti dated
C:-Mutilated
D:-Stale
Correct Answer:- Option-C
Question64:-A deposit receipt is issued by banker in the case of __________deposit. A:-Fixed
B:-Recurring
C:-Savings
D:-Current
Correct Answer:- Option-A
Question65:-The higher rate of interest is on
A:-Current
B:-Savings
C:-Recurring
D:-Fixed
Correct Answer:- Option-D
Question66:-Prime lending rate is announced by the banks taking into account A:-Cost of deposits and borrowing
B:-Yield on loans and investment
C:-Cost of funds and transaction cost
D:-Transaction cost and risk cost
Correct Answer:- Option-C
Question67:-In respect of collection of cheque the banker customer relationship is A:-Agent - Principal
B:-Principal - agent
C:-Bailee - Bailer
D:-Bailer - Bailee
Correct Answer:- Option-A
Question68:-The person who is named in the cheque to receive money is
A:-Drawee
B:-Payee
C:-Depositor
D:-Bank
Correct Answer:- Option-B
Question69:-A cheque is payable
A:-on demand
B:-after a reasonable time
C:-within three months
D:-within six months
Correct Answer:- Option-A
Question70:-In a cheque if the amount in words and figures differ, NI Act says A:-Cheque should be returned
B:-Amount in words can be paid
C:-Amount in figures can be paid
D:-Lower amount can be paid
Correct Answer:- Option-B
Question71:-A bill of exchange expressed to be payable after 45 days is called A:-Usance bill
B:-Demand bill
C:-Sight bill
D:-All of the above
Correct Answer:- Option-A
Question72:-Who can give a notice of dishonour to drawer is case of dishonour of cheque A:-Drawer
B:-Banker
C:-Payee
D:-Payee or holder
Correct Answer:- Option-D
Question73:-In case of return of cheque for want of funds, reason stating is A:-Refer to Drawer
B:-Present again
C:-Insufficient funds
D:-Exceed arrangement
Correct Answer:- Option-C
Question74:-In a pledge advance possession and security charges with
A:-Pledger
B:-Pledgee
C:-Both of them
D:-None of them
Correct Answer:- Option-B
Question75:-The contribution to the financial inclusion fund is not made by which of the following A:-Government of India
B:-State Government
C:-RBI
D:-NABARD
Correct Answer:- Option-B
Question76:-The Supervision of Service Co-op Bank and District Co-Op Bank vest with ___________ as per section 35(6) of BR Act. A:-NABARD
B:-RBI
C:-State Government
D:-Registrar of CS
Correct Answer:- Option-A
Question77:-Two or more separately incorporated banks are brought under one common control by any device other than that of holding company A:-Group Banking
B:-Chain banking
C:-Mixed banking
D:-None of these
Correct Answer:- Option-B
Question78:-Regional Rural Bank Act was passed in
A:-1974
B:-1975
C:-1976
D:-1977
Correct Answer:- Option-C
Question79:-The following cards is not issued by Co-op Banks in Kerala
A:-Debit cards
B:-Credit cards
C:-ATM cards
D:-Kisan credit cards
Correct Answer:- Option-B
Question80:-Monthly average of balance sheet items excluding contra item is
A:-Working fund
B:-Working capital
C:-Borrowed fund
D:-Capital
Correct Answer:- Option-A
Question81:-The main financial statements are ___________ and profit and loss account.
A:-Trading Account
B:-Receipt and Disbursement
C:-Balance sheet
D:-None of these
Correct Answer:- Option-C
Question82:-Average yield on assets minus average cost of funds is
A:-Financial Margin
B:-Margin
C:-Net Margin
D:-None of these
Correct Answer:- Option-A
Question83:-Income on resources raised is
A:-Transaction cost
B:-Risk cost
C:-Management cost
D:-Financial cost
Correct Answer:- Option-D
Question84:-Total working capital in a business is
A:-Total current assets
B:-Total assets
C:-Current assets minus current liabilities
D:-None of these
Correct Answer:- Option-A
Question85:-SERF AESI Act means securilization and _____________ of Financial Assets and Enforcement of Security Interest Act. A:-Restructuring
B:-Reorganisation
C:-Realisation
D:-Reconstruction
Correct Answer:- Option-D
Question86:-A bill of exchange drawn without a valuable consideration is a ___________ bill.
A:-Trade
B:-Clean
C:-Discount
D:-Accommodation
Correct Answer:- Option-D
Question87:-No interest is paid on
A:-Fixed deposit
B:-Current deposit
C:-Saving bank
D:-Recurring deposit
Correct Answer:- Option-B
Question88:-Bank with out any branches is called
A:-Unit
B:-Central
C:-Federal
D:-None of these
Correct Answer:- Option-A
Question89:-Interest on fixed deposit @8% per annum for Rs. 1,25,000/- for one year
A:-Rs. 12,500/-
B:-Rs. 9,000/-
C:-Rs. 1,000/-
D:-Rs. 10,000/-
Correct Answer:- Option-D
Question90:-The first Bank in India which started ATM in 1987 at Delhi
A:-ICICI
B:-HSBC
C:-SBI
D:-HDFC
Correct Answer:- Option-B
Question91:-FEMA replaced FERA in the year
A:-2000
B:-1999
C:-2009
D:-2010
Correct Answer:- Option-A
Question92:-The first Bank which started cheque system in India was
A:-Dena Bank
B:-Bengal Bank
C:-State Bank of India
D:-Canara Bank
Correct Answer:- Option-B
Question93:-Framing of policy and guidelines for rural financial institutions is done by
A:-NABARD
B:-RBI
C:-NCDC
D:-None of these
Correct Answer:- Option-B
Question94:-Which of the following is applicable to Bankers lien?
A:-Safe custody
B:-Debts not due
C:-Deposits
D:-Securities left negligently
Correct Answer:- Option-C
Question95:-Introduction is not necessary in one of the following case
A:-Joint account
B:-Minor account
C:-Illiterate account
D:-Trust account
Correct Answer:- Option-D
Question96:-A minor endorsed a cheque in favour of another person. The endorsement is A:-Valid endorsement
B:-Invalid endorsement
C:-Valid endorsement and Binding endorsement
D:-Valid endorsement and Not binding him
Correct Answer:- Option-D
Question97:-Once a bearer always a bearer. This narrates in section of NI Act
A:-Section 6
B:-Section 15
C:-Section 85
D:-Section 18
Correct Answer:- Option-C
Question98:-POS refers to
A:-Point of Sale
B:-Post Office Savings
C:-Point of Service
D:-Position of Outstanding Sale
Correct Answer:- Option-A
Question99:-In the case of accounts suspended to have terrorist links, banks are advised to made suitable report to A:-RBI
B:-NABARD
C:-Financial intelligence unit
D:-GBI
Correct Answer:- Option-C
Question100:-The present Finance Minister of Kerala
A:-Pinarayi Vijayan
B:-E.P. Jayarajan
C:-Dr. Thomas Isac D:-A.C. Moideen
Correct Answer:- Option-C