Counter party Credit Risk Abbrevetions

ABS Asset-Backed Security
AIG American International Group Inc.
AIGFP AIG Financial Product
ASW Asset SWap
ATE Additional Termination Event
BCBS Basel Committee on Banking Supervision
BCVA Bilateral Credit Value Adjustment
BSM Black–Scholes–Merton
CAPM Capital Asset Pricing Model
CCDS Contingent Credit Default Swap
CCF Credit Conversion Factor
CCP Central CounterParty
CDO Collateralised Debt Obligation
CDPC Credit Derivative Product Company
CDS Credit Default Swap
CEM Current Exposure Method
CF CashFlow
CFTC Commodity Futures Trading Commission
CLN Credit-Linked Note
CPPI Constant Proportion Portfolio Insurance
CPU Central Processing Unit
CRG Counterparty Risk Group
CSA Credit Support Amount
CSO Collateralised Synthetic Obligation
CVA Credit Value Adjustment
DBL Drexel–Burnham–Lambert
DC Determination Committee
DD Distance to Default
DPC Derivatives Product Company (or Corporation)
EAD Exposure At Default
EDF Expected Default Frequency
EE Expected Exposure

EEPE Effective Expected Positive Exposure
EPE Expected Positive Exposure
ERM Enterprise Risk Management
ETO Early Termination Option
EVT Extreme Value Theory
FX Foreign eXchange
G10 Group of Ten
GCM General Clearing Member
ICM Individual Clearing Member
IMM Internal Model Method; International Monetary Market
IRB Internal Ratings Based
IRS Interest Rate Swap
ISDA International Swaps and Derivatives Association
LGD Loss Given Default
LHP Large Homogeneous Pool
LIBOR London Inter-Bank Offer Rate
LSS Leveraged Super Senior
LTCM Long Term Capital Management
MA Maturity Adjustment
MBS Mortgage-Backed Security
MMR Modified Modified Restructuring
MR Modified Restructuring
MTA Minimum Transfer Amount
MtM Mark-to-Market
NA North American
NAV Net Asset Value
NCM Non-Clearing Member
NGR Ratio of current Net exposure to current GRoss exposure
NN No Netting
NS Netting Set
OTC Over The Counter
PD Probability of Default
PFE Potential Future Exposure
PWC PriceWaterhouseCooper
RC Regulatory Capital
RED Reference Entity Database
S&P Standard & Poor
SFAS Standards of Financial Accounting Statement
SFT Structured Finance Transaction
SIV Structured Investment Vehicle
SM Standardised Method
SPAN Standard Portfolio Analysis of Risk
SPE Special Purpose Entity
SPV Special Purpose Vehicle
TRS Total Return Swap
VAR Value-at-Risk
WR Withdrawn Rating

Certified Credit professional Numericals

Assets
Net Fixed Assets - 800
Inventories - 300
Preliminary Expenses - 100
Receivables - 150
Investment In Govt. Secu - 50
Total Assets - 1400
Liabilities
Equity Capital - 200
Preference Capital - 100
Term Loan - 600
Bank C/C - 400
Sundry Creditors - 100
Total Liabilities – 1400
1. Debt Equity Ratio = ?
a. 1:1
b. 1:2
c. 2:1
d. 2:3
Ans - c
Explanation :
600 / (200+100) = 2 : 1
2. Tangible Net Worth = ?
a. 100
b. 200
c. 300
d. 400
Ans - b
Explanation :
Only equity Capital i.e. = 200
3. Total Liabilities to Tangible Net Worth Ratio = ?
a. 7:2
b. 11:2
c. 13:2
d. 15:2
Ans - b
Explanation :
Total Outside Liabilities / Total Tangible Net Worth : (600+400+100) / 200 = 11 : 2
4. Current Ratio = ?
a. 1:1
b. 1:2
c. 2:1
d. 3:1
Ans - a

Explanation :
(300 + 150 + 50 ) / (400 + 100 ) = 1 : 1

Q.2

Assets

Net Fixed Assets - 265

Cash - 1

Receivables - 125

Stocks - 128

Prepaid Expenses - 1

Intangible Assets - 30

Total - 550

Liabilities

Capital + Reserves - 355

P & L Credit Balance - 7

Loan From S F C - 100

Bank Overdraft - 38

Creditors - 26

Provision of Tax - 9

Proposed Dividend - 15

Total - 550

1. Current Ratio = ?

= (1+125 +128+1) / (38+26+9+15)

= 255/88

= 2.89 : 1

2. Quick Ratio = ?

(125+1)/88

= 1.43 : 11

3. Debt Equity Ratio = ?

= LTL / Tangible NW

= 100 / (362 – 30)

= 100 / 332

= 0.30 : 1

4. Proprietary Ratio = ?

= (T NW / Tangible Assets) x 100

= [(362 - 30 ) / (550 – 30)] x 100

= (332 / 520) x 100

= 64%

5. Net Working Capital = ?

= CA - CL

= 255 - 88

= 167

6. If Net Sales is Rs.15 Lac, then What would be the Stock Turnover Ratio in Times ?

= Net Sales / Average Inventories/Stock

= 1500 / 128

= 12 times approximately

7. What is the Debtors Velocity Ratio if the sales are Rs. 15 Lac?



= (Average Debtors / Net Sales) x 12

= (125 / 1500) x 12

= 1 month

8. What is the Creditors Velocity Ratio if Purchases are Rs.10.5 Lac?

= (Average Creditors / Purchases ) x 12

= (26 / 1050) x 12

= 0.3 months

.............................................



Q.3 Current Ratio of a firm is 1 : 1. What will be the Net Working Capital ?

a. 0

b. 1

c. 100

d. 200

Ans - a

Explanation :

It suggest that the Current Assets is equal to Current Liabilities hence the NWC would be

0

(since NWC = C.A - C.L)

.............................................

Q.4 Suppose Current Ratio is 4 : 1. NWC is Rs.30,000/-. What is the amount of Current

Assets ?

a. 10000

b. 30000

c. 40000

d. 50000

Ans - c

Explanation :

Let Current Liabilities = a

4a - 1a = 30,000

a = 10,000 i.e. Current Liabilities is Rs.10,000

Hence Current Assets would be

4a = 4 x 10,000 = Rs.40,000/-

.............................................

Q.5 The amount of Term Loan installment is Rs.10000/ per month, monthly average interest

on TL is Rs.5000/-. If the amount of Depreciation is Rs.30,000/- p.a. and PAT is

Rs.2,70,000/-. What would be the DSCR ?

a. 1

b. 1.5

c. 2

d. 2.5

Ans - C

Explanation :

DSCR = (PAT + Depr + Annual Intt.) / Annual Intt + Annual Installment

= (270000 + 30000 + 60000 ) / 60000 + 12000

= 360000 / 180000

= 2

.............................................

Q. 6     A Company has Net Worth of Rs.5 Lac, Term Liabilities of Rs.10 Lac. Fixed Assets worth

RS.16 Lac and Current Assets are Rs.25 Lac. There is no intangible Assets or other Non

Current Assets. Calculate its Net Working Capital.

a. 1 lac

b. 2 lac

c. - 1 lac





d. - 2 lac

Ans - c

Explanation :

Total Assets = 16 + 25 = Rs. 41 Lac

Total Liabilities = NW + LTL + CL = 5 + 10 + CL = 41 Lac

Current Liabilities = 41 – 15 = 26 Lac

Therefore Net Working Capital = CA – CL = 25 – 26 = (-) 1 Lac

.............................................

Q. 7  Merchandise costs - Rs. 250000, Gross Profit - Rs. 23000, Net Profit - Rs. 15000. Find

the amount of sales.

a. 227000

b. 235000

c. 265000

d. 273000

Ans - d

Explanation :

Amount of sales = Merchandise costs + Gross Profit

= 250000 + 23000

= 273000

.............................................

Q.8 Total Liabilities of a firm is Rs.100 Lac and Current Ratio is 1.5 : 1. If Fixed Assets and

Other Non Current Assets are to the tune of Rs. 70 Lac and Debt Equity Ratio being 3 :

1. What would be the Long Term Liabilities?

a. 40 Lacs

b. 60 Lacs

c. 80 Lacs

d. 100 Lacs

Ans - b

Explanation :

Total Assets = Total Liabilities = 100 Lac

Current Asset = Total Assets - Non Current Assets

= Rs. 100 L - Rs. 70 L

= Rs. 30 L

If the Current Ratio is 1.5 : 1

then Current Liabilities works out to be Rs. 20 Lac.

That means, Net Worth + Long Term Liabilities = Rs. 80 Lacs.

If the Debt Equity Ratio is 3 : 1,

then Debt works out to be Rs. 60 Lacs and equity Rs. 20 Lacs.

Therefore the Long Term Liabilities would be Rs.60 Lac.

.............................................

Q.9 Current Ratio = 1.2 : 1.

Total of balance sheet being Rs.22 Lac.

The amount of Fixed Assets + Non Current Assets is Rs. 10 Lac.

What would be the Current Liabilities?

a. 10 Lacs

b. b. 12 Lacs

c. 16 Lacs

d. 22 Lacs

Ans - a

Explanation :

Total Assets is Rs.22 Lac.

Fixed Assets + Non Current Assets is Rs. 10 Lac

Then Current Assets = 22 – 10 = Rs. 12 Lac.

Current Ratio = 1.2 : 1

Current Liabilities = Rs. 10 Lac

.............................................


Q.10 M/s Raj&co's balance sheet included the following accounts:

Cash: 10,000

Accounts Receivable: 5,000

Inventory: 5,000

Stock Investments: 1,000

Prepaid taxes: 500

Current Liabilities: 15,000

Find the Quick Ratio

Quick Ratio = Cash + Cash Equivalents + Short Term Investments + Marketable

Securities + Accounts Receivable) / Current Liabilities

= (10000+5000+1000) / 15000

= 16000 / 15000

= 1.07

.................................

Q.11 M/s Raj&co's balance sheet included the following accounts:

Inventory : 5,000

Prepaid taxes : 500

Total Current Assets : 21,500

Current Liabilities : 15,000

Find the Quick Ratio

Quick Ratio = (Current assets – Inventory - Advances - Prepayments Current Liabilities) /

Current Liabilities

= (21500 - 5000 - 500) / 15000

= 16000 / 15000

= 1.07

.................................



Q.12 XYZ Pvt Ltd has the following assets and liabilities as on 31st March 2015 (in Lakhs) :

Non Current Assets

Goodwill 75

Fixed Assets 75

Current Assets

Cash in hand 25

Cash in bank 50

Short term investments 45

Inventory 25

Receivable 100

Current Liabilities

Trade payables 100

Income tax payables 60

Non Current Liabilities

Bank Loan 50

Deferred tax payable 25

Find the Quick Ratio

Quick Ratio = (Cash in hand + Cash at Bank + Receivables + Marketable Securities) /



Current Liabilities

= (25+50+45+100) / 160

= 220 / 160

= 1.375

.................................





Q.14 GHI Ltd. manufacturers two products :Product G and Product H. The Variable cost of the manufacture is as

follows:

Product G Product H

Direct Material 3 10

Direct Labour (Rs.6 per hour) 18 12

Variable Overhead 4 4

Assets & Liabilities

Liabilities
Net worth/Equity Funds brought in by the
promoters as their investment in business or
generated by and retained in business
Share capital/partner's capital/ Paid up equity
share capital,/owners funds
Reserves & Surplus e.g. General Reserve,
Capital Reserve, Revaluation Reserve and
Other Reserves),Retained Earnings
Undistributed Profits,Preference share capital
(not redeemable within 12 years

Long term liabilities:
Liabilities which are not due for payment within
12 months from the date of the Balance Sheet)
Term loans from financial institutions;
Term loan from banks; Debentures/Bonds;
Deferred payment liability;Preference Shares
redeemable within 12 years;
Fixed Deposits maturing after one year;
Provision for gratuity; Unsecured Loans
Short term for CurrentyLiabilities Liabilities which
are due for payment within 12 months from the
date of the balance sheet and are to be repaid
out of proceeds of current assets,Short term
borrowings from banks (C/C, 0/D or B/P, B/D
limits) for working capital.,Sundry/trade
creditors/creditors/ Account payable,Bills
Payable / trade acceptances
Fixed Deposits from public payable within one
year,Short duration loans or deposits
Provision for taxation, Proposed Dividends,
Provision for bonus, unclaimed dividend.
Deposits from dealers, selling agents etc.
Advance payments from customers,
outstanding expenses and Accruals e.g. wages


Assets

Fixed Assets :Assets which are purchased for long
term and not meant to be sold but used for production.
Land & Building,Plant & Machinery
Vehicles,Furniture & Fixture
Office equipment,Capital Work in Progress These are
represented as under:
Original value (Gross Bock) Less depreciation
Net Block or book value or written down
Value Method

Non Current Assets:
Assets which cannot be classified as current or
fixed or intangible assets Book Debts or Sundry
Debtors more than 6 months old/ Disputed Debts,
Investment of long term nature in shares,
govt. securities, associates or sister firms or
companies. Long term security deposits. Unquoted
investments; Investments in subsidiaries or sister
concerns; Loans & Advances to directors, officers;
Accounts receivables in respect of sale of plant &
machinery; Advances to concerns in which directors
are interested; Deposits with customs port trust etc
Intangible & fictitious Assets Which do not have
physical existence. For example: Goodwill, Patents,
Trade Mark, Copy Right, Preliminary or pre operative
expenses, other formation expenses, debit balance of
P & L account, accumulated losses, bad debts,
Capital issue expenses e.g. discount on issue of
share & debentures, commission on underwriting of
shares & debentures; Deferred revenue expenditure
e.g. Advertisement

Current Assets : Cash in hand, Bank balance
including fixed ,deposits with banks. Stocks/inventory
(such as raw material, stock in process, finished
goods, consumable stores and spares),Book
debts/Sundry debtors/Bills Receivable/ Accounts
receivable/ debtors, Government and other trustee
securities
(other than for long term purposes e.g. sinking funds,
gratuity funds etc.),Readily Marketable/quoted govt. or
other securities meant for sale,Interest accrued and
receivables,Advance payment of taxes,
pre-paid expenses,Advance payments for
merchandise; unexpired insurance

IIBF certifications July 2018 results

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Designated Director and Principle Officer

Designated Director and Principle Officer
a) Designated Director
Banks are required to nominate a Director on their Boards as “Designated Director”, as per the
provisions of the Prevention of Money Laundering (Maintenance of Records) Rules, 2005 (Rules), to
ensure overall compliance with the obligations under the Act and Rules. The name, designation and
address of the Designated Director is to be communicated to the Director, Financial Intelligence
Unit – India (FIU-IND).
b) Principal Officer
Banks should appoint a senior management officer to be designated as Principal Officer. Banks
should ensure that the Principal Officer is able to act independently and report directly to the senior
management or to the Board of Directors. Principal Officer shall be located at the head/corporate
office of the bank and shall be responsible for monitoring and reporting of all transactions and sharing
of information as required under the law. He will maintain close liaison with enforcement agencies,
banks and any other institution which are involved in the fight against money laundering and
combating financing of terrorism
Further, the role and responsibilities of the Principal Officer should include overseeing and ensuring
overall compliance with regulatory guidelines on KYC/AML/CFT issued from time to time and
obligations under the Prevention of Money Laundering Act, 2002, rules and regulations made
thereunder, as amended form time to time. The Principal Officer will also be responsible for timely
submission of CTR, STR and reporting of counterfeit notes and all transactions involving


receipts by non-profit organisations of value more than Rupees Ten Lakh or its equivalent in foreign
currency to FIU-IND.With a view to enabling the Principal Officer to discharge his responsibilities
effectively, the Principal Officer and other appropriate staff should have timely access to customer
identification data and other CDD information, transaction records and other relevant information

Ordering, Intermediary and Beneficiary banks

Role of Ordering, Intermediary and Beneficiary banks
i) Ordering Bank
An ordering bank is the one that originates a wire transfer as per the order placed by its
customer. The ordering bank must ensure that qualifying wire transfers contain complete
originator information. The bank must also verify and preserve the information at least for
a period of ten years.
ii) Intermediary bank
For both cross-border and domestic wire transfers, a bank processing an intermediary
element of a chain of wire transfers must ensure that all originator information
accompanying a wire transfer is retained with the transfer. Where technical limitations
prevent full originator information accompanying a cross-border wire transfer from
remaining with a related domestic wire transfer, a record must be kept at least for ten
years (as required under Prevention of Money Laundering Act, 2002) by the receiving
intermediary bank of all the information received from the ordering bank.
iii) Beneficiary bank

A beneficiary bank should have effective risk-based procedures in place to identify wire
transfers lacking complete originator information. The lack
of complete originator information may be considered as a factor in assessing whether a
wire transfer or related transactions are suspicious and whether they should be reported
to the Financial Intelligence Unit-India. The beneficiary bank should also take up the
matter with the ordering bank if a transaction is not accompanied by detailed information
of the fund remitter. If the ordering bank fails to furnish information on the remitter, the
beneficiary bank should consider restricting or even terminating its business relationship
with the ordering bank.

Wire transfer

Wire Transfer
Banks use wire transfers as an expeditious method for transferring funds between bank
accounts. Wire transfers include transactions occurring within the national boundaries of a
country or from one country to another. As wire transfers do not involve actual movement of
currency, they are considered as rapid and secure method for transferring value

tracing their assets. The information can be used by Financial Intelligence Unit - India (FIUIND)
for analysing suspicious or unusual activity and disseminating it as necessary. The
originator information can also be put to use by the beneficiary bank to facilitate identification
and reporting of suspicious transactions to FIU-IND. Owing to the potential terrorist financing
threat posed by small wire transfers, the objective is to be in a position to trace all wire
transfers with minimum threshold limits. Accordingly, banks must ensure that all wire
transfers are accompanied by the following information:
1. Cross-border wire transfers
i) All cross-border wire transfers must be accompanied by accurate and
meaningful originator information.
ii) Information accompanying cross-border wire transfers must contain the name
and address of the originator and where an account exists, the number of that
account. In the absence of an account, a unique reference number, as
prevalent in the country concerned, must be included.
iii) Where several individual transfers from a single originator are bundled in a
batch file for transmission to beneficiaries in another country, they may be
exempted from including full originator information, provided they include the
originator’s account number or unique reference number as at (ii) above.
2. Domestic wire transfers
i) Information accompanying all domestic wire transfers of Rs.50000/- (Rupees
Fifty Thousand) and above must include complete originator information i.e.
name, address and account number etc., unless full originator information can
be made available to the beneficiary bank by other means.
ii) If a bank has reason to believe that a customer is intentionally structuring wire
transfer to below Rs. 50000/- (Rupees Fifty Thousand) to several beneficiaries
in order to avoid reporting or


monitoring, the bank must insist on complete customer identification before
effecting the transfer. In case of non-cooperation from the customer, efforts
should be made to establish his identity and Suspicious Transaction Report
(STR) should be made to FIU-IND.
bi) When a credit or debit card is used to effect money transfer, necessary
information as (i) above should be included in the message.
c) Exemptions
Interbank transfers and settlements where both the originator and beneficiary are banks or
financial institutions would be exempted from the above requirements.

Know Your Customer (KYC) Norms/Anti-Money Laundering (AML) Measures/Combating of Financing of Terrorism (CFT)/Obligations of banks under PMLA, 2002

Know Your Customer (KYC) Norms/Anti-Money Laundering (AML)
Measures/Combating of Financing of Terrorism (CFT)/Obligations of banks under
PMLA, 2002

The objective of KYC/AML/CFT guidelines is to prevent banks from being used, intentionally or
unintentionally, by criminal elements for money laundering or terrorist financing activities. KYC
procedures also enable banks to know/understand their customers and their financial dealings
better which in turn help them manage their risks prudently.
1.2. Definition of Customer
For the purpose of KYC policy, a ‘Customer’ is defined as:
c a person or entity that maintains an account and/or has a business relationship with the
bank;

Prevention of Money-laundering Act, 2002 (15 of 2003)

Prevention of Money-laundering Act, 2002 (15 of 2003), the Central Government hereby
makes the following amendments to the Prevention
of Money-laundering (Maintenance of Records of the Nature and Value of Transactions, the
Procedure and Manner of Maintaining and Time for
Furnishing Information and Verification and Maintenance of Records of the Identity of the
Clients of the Banking Companies, Financial Institutions and Intermediaries) Rules, 2005,
namely::-
1. (1)These rules may be called the Prevention of Moneylaundering
(Maintenance of Records of the Nature and Value of



Transactions, the Procedure and Manner of Maintaining and Time for Furnishing
Information and Verification and Maintenance of Records of the Identity of the Clients of the
Banking Companies, Financial
Institutions and Intermediaries) Third Amendment Rules, 2010.
(2) They shall come into force on the date of their publication in the Official
Gazette.
2. In the Prevention of Money-laundering (Maintenance of Records of the Nature
and Value of Transactions, the Procedure and Manner of



Maintaining and Time for Furnishing Information and Verification and Maintenance of
Records of the Identity of the Clients of the Banking
Companies, Financial Institutions and Intermediaries) Rules, 2005, -
(a) in rule 2,-
(i) after clause (b), the following clause shall be inserted, namely:-
“(bb) “Designated Officer” means any officer or a class of officers authorized by a
banking company, either by name or by designation, for the purpose of opening
small accounts”.
(ii) in clause (d), for the words “the Election Commission of India or
any other document as may be required by the banking company or financial institution or
intermediary”, the words “Election Commission of India, job card issued by NREGA duly
signed by an officer of the State Government, the letter issued by the Unique Identification
Authority of India containing details of name, address and Aadhaar number or any other
document as notified by the Central Government in consultation with the Reserve Bank of
India or any other document as may be required by the banking companies, or financial
institution or intermediary” shall be substituted;
(iii) after clause (fa), the following clause shall be inserted, namely:-
“(fb) “small account” means a savings account in a banking company where


(i) the aggregate of all credits in a financial year does not exceed rupees
one lakh,
(ii) the aggregate of all withdrawals and transfers in a month does not
exceed rupees ten thousand, and;
(iii) the balance at any point of time does not exceed rupees fifty thousand”.
(b) In rule 9, after sub-rule (2), the following sub-rule shall be inserted, namely:-
“(2A) Notwithstanding anything contained in sub-rule (2), an individual who desires to
open a small account in a banking company may be allowed to open such an account
on production of a self-attested photograph and affixation of signature or thumb print,
as the case may be, on the form for opening the account.
Provided that –

(i) the designated officer of the banking company, while opening the small account,
certifies under his signature that the person opening the account has affixed his
signature or thumb print, as the case may be, in his presence;
(ii) a small account shall be opened only at Core Banking Solution linked banking
company branches or in a branch where it is possible to manually monitor and ensure
that foreign remittances are not credited to a small account and that the stipulated limits
on monthly and annual aggregate of transactions and balance in such accounts are not
breached, before a transaction is allowed to take place;
(iii) a small account shall remain operational initially for a period of twelve months,
and thereafter for a further period of twelve months if the holder of such an account
provides evidence before the banking company of having applied for any of the
officially valid documents within twelve months of the opening of the said account, with
the entire relaxation provisions to be reviewed in respect of the said account after
twenty four months.
(iv) a small account shall be monitored and when there is suspicion of money
laundering or financing of terrorism or other high risk scenarios, the identity of client
shall be established through the production of officially valid documents, as referred to
in sub rule ( 2) of rule 9"; and
(v) foreign remittance shall not be allowed to be credited into a small account unless
the identity of the client is fully established through the production of officially valid
documents, as referred to in sub-rule (2) of rule 9.”

UAPA 1967

The Unlawful Activities (Prevention) Act, 1967 (UAPA) has been amended and notified
on 31.12.2008, which, inter-alia, inserted Section 51A to the Act. Section 51A reads as under:-
"51A. For the prevention of, and for coping with terrorist activities, the Central
Government shall have power to –
(a) freeze, seize or attach funds and other financial assets or economic resources
held by, on behalf of or at the direction of the individuals or entities Listed in the Schedule
to the Order, or any other person engaged in or suspected to be engaged in terrorism;
(b) prohibit any individual or entity from making any funds, financial assets or
economic resources or related services available for the benefit of the individuals or
entities Listed in the Schedule to the Order or any other person engaged in or suspected
to be engaged in terrorism;
(c) prevent the entry into or the transit through India of individuals Listed in the
Schedule to the Order or any other person engaged in or suspected to be engaged in
terrorism",

The Unlawful Activities (Prevention) Act define "Order" as under:-

"Order" means the Prevention and Suppression of Terrorism (Implementation of Security
Council Resolutions) Order, 2007, as may be amended from time to time.
In order to expeditiously and effectively implement the provisions of Section 51A, the
following procedures shall be followed:-
Appointment and Communication of details of UAPA nodal officers
2. As regards appointment and communication of details of UAPA nodal officers -
(i) The UAPA nodal officer for IS-I division would be the Joint Secretary (IS.I),
Ministry of Home Affairs. His contact details are 011-23092736(Tel), 011-
23092569(Fax) and e-mail.
(ii) The Ministry of External Affairs, Department of Economic Affairs, Foreigners
Division of MHA, FIU-IND; and RBI, SEBI, IRDA (hereinafter referred to as Regulators)
shall appoint a UAPA nodal officer and communicate the name and contact details to
the IS-I Division in MHA.
(iii) The States and UTs should appoint a UAPA nodal officer preferably of the rank
of the Principal Secretary/Secretary, Home Department and communicate the name
and contact details to the IS-I Division in MHA.
(iv) The IS-I Division in MHA would maintain the consolidated list of all UAPA nodal
officers and forward the list to all other UAPA nodal officers.
(v) The RBI, SEBI, IRDA should forward the consolidated list of UAPA nodal officers
to the banks, stock exchanges/depositories, intermediaries regulated by SEBI and
insurance companies respectively.
(vi) The consolidated list of the UAPA nodal officers should be circulated to the nodal
officer of IS-I Division of MHA in July every year and on every change. Joint


Secretary(IS-I), being the nodal officer of IS-I Division of MHA, shall cause the
amended list of UAPA nodal officers to be circulated to the nodal officers of Ministry of
External Affairs, Department of Economic Affairs, Foreigners Division of MHA, RBI,
SEBI, IRDA and FIU-IND.
Communication of the list of designated individuals/entities
3. As regards communication of the list of designated individuals/entities-
(i) The Ministry of External Affairs shall update the list of individuals and entities
subject to UN sanction measures on a regular basis. On any revision, the Ministry of
External Affairs would electronically forward



this list to the Nodal Officers in Regulators, FIU-IND, IS-I Division and Foreigners'
Division in MHA.
(ii) The Regulators would forward the list mentioned in (i) above (referred to as
designated lists) to the banks, stock exchanges/depositories, intermediaries regulated
by SEBI and insurance companies respectively.
(iii) The IS-I Division of MHA would forward the designated lists to the UAPA
nodal officer of all States and UTs.
(iv) The Foreigners Division of MHA would forward the designated lists to the
immigration authorities and security agencies.
Regarding funds, financial assets or economic resources or related services held in the
form of bank accounts, stocks or insurance policies etc.
4. As regards funds, financial assets or economic resources or related services held in
the form of bank accounts, stocks or insurance policies etc., the Regulators would forward the
designated lists to the banks, stock exchanges/depositories, intermediaries regulated by SEBI
and insurance companies respectively. The RBI, SEBI and IRDA would issue necessary
guidelines to banks, stock exchanges/depositories, intermediaries regulated by SEBI and
insurance companies requiring them to -
(i) Maintain updated designated lists in electronic form and run a check on the given
parameters on a regular basis to verify whether individuals or entities listed in the
schedule to the Order (referred to as designated individuals/entities) are holding any
funds, financial assets or economic resources or related services held in the form of bank
accounts, stocks or insurance policies etc. with them.
(ii) In case, the particulars of any of their customers match with the particulars of
designated individuals/entities, the banks, stock exchanges/ depositories, intermediaries
regulated by SEBI and insurance companies shall immediately, not later than 24 hours
from the time of finding out such customer, inform full particulars of the funds, financial
assets or economic resources or related services held in the form of bank accounts,
stocks or insurance policies etc. held by such customer on their books to the Joint


Secretary (IS.I), Ministry of Home Affairs, at Fax No.011-23092569 and also convey over
telephone on 011-23092736. The particulars apart from being sent by post should
necessarily be conveyed on e-mail.
(iii) The banks, stock exchanges/ depositories, intermediaries regulated by SEBI and
insurance companies shall also send by post a copy of the communication mentioned in
(ii) above to the UAPA nodal officer of the


state/ UT where the account is held and Regulators and FIU-IND, as the case may be.
(iv) In case, the match of any of the customers with the particulars of designated
individuals/entities is beyond doubt, the banks stock exchanges / depositories,
intermediaries regulated by SEBI and insurance companies would prevent designated
persons from conducting financial transactions, under intimation to Joint Secretary (IS.I),
Ministry of Home Affairs, at Fax No. 011-23092569 and also convey over telephone on
011-23092736. The particulars apart from being sent by post should necessarily be
conveyed on e-mail.
(v) The banks, stock exchanges/depositories, intermediaries regulated by SEBI and
insurance companies shall file a Suspicious Transaction Report (STR) with FIU-IND
covering all transactions in the accounts covered by paragraph (ii) above , carried
through or attempted, as per the prescribed format.
5. On receipt of the particulars referred to in paragraph 3(ii) above, IS-I Division of MHA
would cause a verification to be conducted by the State Police and/or the Central Agencies so as
to ensure that the individuals/entities identified by the banks, stock exchanges/depositories,
intermediaries regulated by SEBI and Insurance Companies are the ones listed as designated
individuals/entities and the funds, financial assets or economic resources or related services,
reported by banks, stock exchanges/depositories, intermediaries regulated by SEBI and
insurance companies are held by the designated individuals/entities. This verification would be
completed within a period not exceeding 5 working days from the date of receipt of such
particulars.
6. In case, the results of the verification indicate that the properties are owned by or held
for the benefit of the designated individuals/entities, an order to freeze these assets under section
51A of the UAPA would be issued within 24 hours of such verification and conveyed electronically
to the concerned bank branch, depository, branch of insurance company branch under intimation
to respective Regulators and FIU-IND. The UAPA nodal officer of IS-I Division of MHA shall also
forward a copy thereof to all the Principal Secretary/Secretary, Home Department of the States or
UTs, so that any individual or entity may be prohibited from making any funds, financial assets or
economic assets or economic resources or related services available for the benefit of the
designated individuals/entities or any other person engaged in or suspected to be engaged in
terrorism. The UAPA nodal officer of IS-I Division of MHA shall also forward a copy of the order
under Section 51A, to all Directors General of Police/Commissioners of Police of all states/UTs
for initiating action under the provisions of Unlawful Activities (Prevention) Act.
The order shall take place without prior notice to the designated individuals/entities.


Regarding financial assets or economic resources of the nature of immovable properties.
7. IS-I Division of MHA would electronically forward the designated lists to the UAPA nodal
officer of all States and UTs with the request to have the names of the designated
individuals/entities, on the given parameters, verified from the records of the office of the
Registrar performing the work of registration of immovable properties in their respective
jurisdiction.
8. In case, the designated individuals/entities are holding financial assets or economic
resources of the nature of immovable property and if any match with the designated
individuals/entities is found, the UAPA nodal officer of the State/UT would cause communication
of the complete particulars of such individual/entity along with complete details of the financial
assets or economic resources of the nature of immovable property to the Joint Secretary (IS.I),
Ministry of Home Affairs, immediately within 24 hours at Fax No.011-23092569 and also convey
over telephone on 011-23092736. The particulars apart from being sent by post should
necessarily be conveyed on e-mail.
9. The UAPA nodal officer of the State/UT may cause such inquiry to be conducted by the
State Police so as to ensure that the particulars sent by the Registrar performing the work of
registering immovable properties are indeed of these designated individuals/entities. This
verification would be completed within a maximum of 5 working days and should be conveyed
within 24 hours of the verification, if it matches with the particulars of the designated
individual/entity to Joint Secretary(IS-I), Ministry of Home Affairs at the Fax telephone numbers
and also on the e-mail id given below.
10. A copy of this reference should be sent to the Joint Secretary (IS.I), Ministry of Home
Affairs, at Fax No.011-23092569 and also convey over telephone on 011-23092736. The
particulars apart from being sent by post would necessarily be conveyed on e-mail. MHA may
have the verification also conducted by the Central Agencies. This verification would be
completed within a maximum of 5 working days.
11. In case, the results of the verification indicate that the particulars match with those of
designated individuals/entities, an order under Section 51A of the UAPA would be issued within
24 hours, by the nodal officer of IS-I Division of MHA and conveyed to the concerned Registrar


performing the work of registering immovable properties and to FIU-IND under intimation to the
concerned UAPA nodal officer of the State/UT.
The order shall take place without prior notice, to the designated individuals/entities.
12. Further, the UAPA nodal officer of the State/UT shall cause to monitor the
transactions/accounts of the designated individual/entity so as to prohibit any individual or entity
from making any funds, financial assets or economic resources or related services available for
the benefit of the individuals or entities listed in the schedule to the order or any other person
engaged in or suspected to be engaged in terrorism. The UAPA nodal officer of the State/UT
shall upon coming to his notice, transactions and attempts by third party immediately bring to the
notice of the DGP/Commissioner of Police of the State/UT for also initiating action under the
provisions of Unlawful Activities (Prevention) Act.
Implementation of requests received from foreign countries under U.N. Security Council
Resolution 1373 of 2001.
13. U.N. Security Council Resolution 1373 obligates countries to freeze without delay the
funds or other assets of persons who commit, or attempt to commit, terrorist acts or participate in
or facilitate the commission of terrorist acts; of entities owned or controlled directly or indirectly by
such persons; and of persons and entities acting on behalf of, or at the direction of such persons
and entities, including funds or other assets derived or generated from property owned or
controlled, directly or indirectly, by such persons and associated persons and entities. Each
individual country has the authority to designate the persons and entities that should have their
funds or other assets frozen. Additionally, to ensure that effective cooperation is developed
among countries, countries should examine and give effect to, if appropriate, the actions initiated
under the freezing mechanisms of other countries.
14. To give effect to the requests of foreign countries under U.N. Security Council Resolution
1373, the Ministry of External Affairs shall examine the requests made by the foreign countries
and forward it electronically, with their comments, to the UAPA nodal officer for IS-I Division for
freezing of funds or other assets.
15. The UAPA nodal officer of IS-I Division of MHA, shall cause the request to be examined,
within 5 working days so as to satisfy itself that on the basis of applicable legal principles, the
requested designation is supported by reasonable grounds, or a reasonable basis, to suspect or
believe that the proposed designee is a terrorist, one who finances terrorism or a terrorist
organization, and upon his satisfaction, request would be electronically forwarded to the nodal
officers in Regulators. FIU-IND and to the nodal officers of the States/UTs. The proposed
designee, as mentioned above would be treated as designated individuals/entities.


16. Upon receipt of the requests by these nodal officers from the UAPA nodal officer of IS-I
Division, the procedure as enumerated at paragraphs 4 to 12 above shall be followed.


The freezing orders shall take place without prior notice to the designated persons
involved.
Procedure for unfreezing of funds, financial assets or economic resources or related
services of individuals/entities inadvertently affected by the freezing mechanism upon
verification that the person or entity is not a designated person
17. Any individual or entity, if it has evidence to prove that the freezing of funds, financial
assets or economic resources or related services, owned/held by them has been inadvertently
frozen, they shall move an application giving the requisite evidence, in writing, to the concerned
bank, stock exchanges/depositories, intermediaries regulated by SEBI, insurance companies,
Registrar of Immovable Properties and the State/UT nodal officers.
18. The banks stock exchanges/depositories, intermediaries regulated by SEBI, insurance
companies, Registrar of Immovable Properties and the State/UT nodal officers shall inform and
forward a copy of the application together with full details of the asset frozen given by any
individual or entity informing of the funds, financial assets or economic resources or related
services have been frozen inadvertently, to the nodal officer of IS-I Division of MHA as per the
contact details given in paragraph 4(ii) above within two working days.
19. The Joint Secretary (IS-I), MHA, being the nodal officer for (IS-I) Division of MHA, shall
cause such verification as may be required on the basis of the evidence furnished by the
individual/entity and if he is satisfied, he shall pass an order, within 15 working days, unfreezing
the funds, financial assets or economic resources or related services, owned/held by such
applicant under intimation to the concerned bank, stock exchanges/depositories, intermediaries
regulated by SEBI, insurance company and the nodal officers of States/UTs. However, if it is not
possible for any reason to pass an order unfreezing the assets within fifteen working days, the
nodal officer of IS-I Division shall inform the applicant.
Communication of Orders under section 51A of Unlawful Activities (Prevention) Act.
20. All Orders under section 51A of Unlawful Activities (Prevention) Act, relating to funds,
financial assets or economic resources or related services, would be communicated to all banks,
depositories/stock exchanges, intermediaries regulated by SEBI, insurance companies through
respective Regulators, and to all the Registrars performing the work of registering immovable
properties, through the State/UT nodal officer by IS-I Division of MHA.


Regarding prevention of entry into or transit through India

21. As regards prevention of entry into or transit through India of the designated individuals, the
Foreigners Division of MHA, shall forward the designated lists to the immigration authorities and
security agencies with a request to prevent the entry into or the transit through India. The order
shall take place without prior notice to the designated individuals/entities.
22. The immigration authorities shall ensure strict compliance of the Orders and also
communicate the details of entry or transit through India of the designated individuals as
prevented by them to the Foreigners' Division of MHA.
Procedure for communication of compliance of action taken under Section 51A.
23. The nodal officers of IS-I Division and Foreigners Division of MHA shall furnish the details
of funds, financial assets or economic resources or related services of designated
individuals/entities frozen by an order, and details of the individuals whose entry into India or
transit through India was prevented, respectively, to the Ministry of External Affairs for onward
communication to the United Nations

Some important acts

#Some_Important_Acts

🔴NEGOTIABLE INSTRUMENTACTS -1881

⚫Section 4 :- Promissory Notes
⚫Section 5 :-Bill of Exchange
⚫Section 6 :- Cheque
⚫Section 13 :- Negotiable instrument
⚫Section 123 :- Cheque Crossed Generally
⚫Section 124,126 : -Cheque Crossed Specially
⚫Section 130 : -Cheque bearing Not Negotiable
⚫Section 118 :- Presumption as to Negotiable instrument

🔴RESERVE BANK ACT (RBI ACT 1934)

⚫Section 17 :- Define Banking Business
⚫Section 18 :-Deals With Emergency Loan To Bank
⚫Section 22 :-Exclusive Rights To Issue Currency Notes In India
⚫Section 24 :-Maximum Denomination a Note Can Be Rs 10,000
⚫Section 26 :- Describe The Legal Tender Character of Indian Bank Notes
⚫Section 28 :-Form Rule Regarding The Exchange Of Damaged and imperfect Notes
⚫Section 31 :-In India only RBI or the central government issue and accept promissory notes that are payable on demand
⚫Section 42 :-Every schedule bank must have an average daily balance with RBI

🔴BANKING REGULATION ACT -1949

⚫Section 10 :-Power of RBI to appoint chairman of banking company
⚫Section 11 :-Recruitment as to minimum capital and reserve.
⚫Section 12 : -Regulation of Paid of capital, authorized capital,voting rights of shareholder
⚫Section 21 :-To control advances by banking company
⚫Section 21(A) : - Rate of interest charged by banking company
⚫Section 22 :- license of banking company
⚫Section 23 :-Restriction on opening transfer of business
⚫Section 29 :-Account and balance sheet
⚫Section 36 :-Power of central government to acquire banking company in a certain case
⚫Section 44 :-Amalgamation of banking company
⚫Section 47 :-Power of RBI to impose penalty

🔴Some Other Important Acts Related To Banking -

⚫SBI ACT: -1955
⚫SBI SUBSIDIARY ACT: - 1959
⚫DICGC ACT :- 1961
⚫EXIM ACT: - 1981
⚫NABARD ACT: - 1981
⚫RRB ACT: - 1976
⚫NHB ACT: - 1987
⚫SIDBI ACT :- 1989
⚫SARFASI ACT :- 2002
⚫FEMA ACT: - 1999
⚫CREDIT INFORMATION CORP :- 2005
⚫PMLA ACT: -2002

OFAC

OFAC::


The Office of Foreign Assets Control (OFAC) of the US Department of the Treasury administers and enforces economic and trade sanctions based on US foreign policy and national security goals against targeted foreign countries and regimes, terrorists, international narcotics traffickers, those engaged in activities related to the proliferation of weapons of mass destruction, and other threats to the national security, foreign policy or economy of the United States. OFAC acts under Presidential national emergency powers, as well as authority granted by specific legislation, to impose controls on transactions and freeze assets under US jurisdiction. Many of the sanctions are based on United Nations and other international mandates, are multilateral in scope, and involve close cooperation with allied governments.

While sanctions programs implemented by the Treasury Department’s Office of Foreign Assets Control (OFAC) may be authorized by congressional legislations, most are authorized under executive orders issued pursuant to presidential national emergency powers in response to a declared emergency.

The International Emergency Economic Powers Act (IEEPA), which can be viewed here, grants the President of the United States broad authority to respond to “unusual or extraordinary threat[s]” to the national security, foreign policy, or economy of the United States. Invocation of such authorities are legally premised upon the official declaration of a national emergency by the President