ADF
|
Automated Data Flow
|
ARIMA
|
Autoregressive Integrated Moving Average
|
BC
|
Business Correspondents
|
BFS
|
Board for Financial Supervision
|
BI
|
Business Intelligence
|
BIS
|
Bank for International Settlements
|
BO
|
Business Objects
|
BSR
|
Basic Statistical Returns
|
CBS
|
Core Banking Solution
|
CDS
|
Credit Default Swap
|
CGM
|
Chief General Manager
|
CIO
|
Chief Information Officer
|
CISO
|
Chief Information Security Officer
|
CSO
|
Central Statistics Office
|
CTO
|
Chief Technology Officer
|
DBIE
|
Database of Indian Economy
|
DBOD
|
Department of Banking Operations and Development
|
DBS
|
Department of Banking Supervision
|
DEPR
|
Department of Economic and Policy Research
|
DFMS
|
Data Flow Monitoring System
|
DGI
|
Data Gap Initiative
|
DIT
|
Department of Information Technology
|
DNBS
|
Department of Non-Banking Supervision
|
DSB
DSIM |
Department of Supervision- Banking
Department of Statistics and Information Management |
DW
|
Data Warehouse
|
ECB
|
European Central Bank
|
EDW
|
Enterprise Data Warehouse
|
ETL
|
Extraction, Transformation and Loading
|
FI
|
Financial Inclusion
|
FID
|
Financial Institutions Division
|
FSI
|
Financial Soundness Indicator
|
HSUI
|
Housing Start-Up Index
|
IDRBT
|
Institute for Development & Research in Banking Technology
|
IFC
|
Irving Fisher Committee (on Central Bank Statistics at BIS)
|
IIT
|
Indian Institute of Technology
|
IMF
|
International Monetary Fund
|
IRISc
|
Integrated Risk and Impact Scoring (Model)
|
ISI
|
Indian Statistical Institute
|
IT
|
Information Technology
|
MIS
|
Management Information System
|
MOF
|
Master Office File
|
NBFCs
|
Non-Banking Financial Companies
|
NBFCs-D
|
NBFCs - Deposit taking
|
NBFCs-ND
|
NBFCs - Non-deposit taking
|
NBFCs-ND-SI
|
NBFCs- Non-Deposit taking - Systemically Important
|
NBS
|
Non-Banking Supervision
|
NCB
|
National Central Bank
|
OECD
|
Organisation for Economic Co-operation and Development
|
OEM
|
Original Equipment Manufacturer
|
OLAP
|
On-line Analytical Processing
|
ORFS
|
Online Returns Filing System
|
PCGM
|
Principal Chief General Manager
|
RBI
|
Reserve Bank of India
|
RBS
|
Risk-Based Supervision
|
RDBMS
|
Relational Database Management System
|
RPCD
|
Rural Planning and Credit Department
|
RRB
|
Regional Rural Bank
|
RTGS
|
Real Time Gross Settlement
|
SCB
|
Scheduled Commercial Bank
|
SDDS
|
Special Data Dissemination Standard
|
SDMX
|
Statistical Data and Metadata Exchange
|
SFTP
|
Secure File Transfer Protocol
|
SSM
|
Senior Supervisory Manager
|
StCB
|
State Co-operative Bank
|
UBD
|
Urban Banks Department
|
UCB
|
Urban Co-operative Bank
|
XBRL
|
eXtensible Business Reporting Language
|
XSD
|
XML Schema Definition
|
Tuesday, 28 August 2018
RISK BASED supervision abbrevetions
The Consumer Protection Act, 1986
The Consumer Protection Act, 1986
This Act was passed “to provide for better protection of the interest of
consumers and to make provision for the establishment of consumer councils
and other authorities for the settlement of consumer’s disputes.” The Act has
been amended by the Consumer Protection (Amendment) Act, 2002.
a) Definitions under the Act
Some definitions provided in the Act are as follows:
Definition
“Service” means service of any description which is made available to potential
users and includes the provision of facilities in connection with banking,
financing, insurance, transport, processing, supply of electrical or other energy,
board or lodging or both, housing construction, entertainment, amusement or
the purveying of news or other information. But it does not include the
rendering of any service free of charge or under a contract of personal service.
Insurance is included as a service
“Consumer” means any person who:
i. Buys any goods for a consideration and includes any user of such goods.
But does not include a person who obtains such goods for resale or for
any commercial purpose or
ii. Hires or avails of any services for a consideration and includes
beneficiary of such services.
'Defect' means any fault, imperfection, shortcoming inadequacy in the quality,
nature and manner of performance which is required to be maintained by or
under any law or has been undertaken to be performed by a person in
pursuance of a contract or otherwise in relation to any service.
'Complaint' means any allegation in writing made by a complainant that:
i. An unfair trade practice or restrictive trade practice has been adopted
ii. The goods bought by him suffer from one or more defects
iii. The services hired or availed of by him suffer from deficiency in any
respect
iv. Price charged is in excess of that fixed by law or displayed on package
Goods which will be hazardous to life and safety when used are being
offered for sale to the public in contravention of the provisions of any law
requiring trader to display information in regard to the contents, manner
and effect of use of such goods
'Consumer dispute' means a dispute where the person against whom a
complaint has been made, denies and disputes the allegations contained in the
complaint.
b) Consumer disputes redressal agencies
Consumer disputes redressal agencies are established in each district and
state and at national level.
i. District Forum: The forum has jurisdiction to entertain complaints,
where value of the goods or services and the compensation claimed is up
to Rs. 20 lakhs The District Forum is empowered to send its order/decree
for execution to appropriate Civil Court.
ii. State Commission: This redressal authority has original, appellate and
supervisory jurisdiction. It entertains appeals from the District Forum. It
also has original jurisdiction to entertain complaints where the value of
goods/service and compensation, if any claimed exceeds Rs. 20 lakhs but
does not exceed Rs. 100 lakhs. Other powers and authority are similar to
those of the District Forum.
iii. National Commission: The final authority established under the Act is
the National Commission. It has original; appellate as well as supervisory
jurisdiction. It can hear the appeals from the order passed by the State
Commission and in its original jurisdiction it will entertain disputes,
where goods/services and the compensation claimed exceeds Rs.100
lakhs. It has supervisory jurisdiction over State Commission.
All the three agencies have powers of a Civil Court.
c) Procedure for filing a complaint
The procedure for filing a complaint for the three redressal agencies
mentioned above is very simple. There is no fee for filing a complaint or
filing an appeal whether before the State Commission or National
Commission.
The complaint can be filed by the complainant himself or by his authorised
agent. It can be filed personally or can even be sent by post. It may be
noted that no advocate is necessary for the purpose of filing a complaint.
d) Consumer Forum orders
If the forum is satisfied that the goods complained against suffer from any of
the defects specified in the complaint or that any of the allegations
contained in the complaint about the services are proved, the forum can
issue an order directing the opposite party to do one or more of the
following namely,
i. To return to the complainant the price, [or premium in case of
insurance], the charges paid by the complainant
ii. To award such amount as compensation to the consumers for any loss or
injury suffered by the consumer due to negligence of the opposite party
iii. To remove the defects or deficiencies in the services in question
iv. To discontinue the unfair trade practice or the restrictive trade
practice or not to repeat them
v. To provide for adequate costs to parties
e) Consumer disputes categories
The majority of consumer disputes with the three forums fall in the
following main categories, as far as the insurance business is concerned:
i. Delay in settlement of claims
ii. Non-settlement of claims
iii. Repudiation of claims
iv. Quantum of loss
v. Policy terms, conditions etc
This Act was passed “to provide for better protection of the interest of
consumers and to make provision for the establishment of consumer councils
and other authorities for the settlement of consumer’s disputes.” The Act has
been amended by the Consumer Protection (Amendment) Act, 2002.
a) Definitions under the Act
Some definitions provided in the Act are as follows:
Definition
“Service” means service of any description which is made available to potential
users and includes the provision of facilities in connection with banking,
financing, insurance, transport, processing, supply of electrical or other energy,
board or lodging or both, housing construction, entertainment, amusement or
the purveying of news or other information. But it does not include the
rendering of any service free of charge or under a contract of personal service.
Insurance is included as a service
“Consumer” means any person who:
i. Buys any goods for a consideration and includes any user of such goods.
But does not include a person who obtains such goods for resale or for
any commercial purpose or
ii. Hires or avails of any services for a consideration and includes
beneficiary of such services.
'Defect' means any fault, imperfection, shortcoming inadequacy in the quality,
nature and manner of performance which is required to be maintained by or
under any law or has been undertaken to be performed by a person in
pursuance of a contract or otherwise in relation to any service.
'Complaint' means any allegation in writing made by a complainant that:
i. An unfair trade practice or restrictive trade practice has been adopted
ii. The goods bought by him suffer from one or more defects
iii. The services hired or availed of by him suffer from deficiency in any
respect
iv. Price charged is in excess of that fixed by law or displayed on package
Goods which will be hazardous to life and safety when used are being
offered for sale to the public in contravention of the provisions of any law
requiring trader to display information in regard to the contents, manner
and effect of use of such goods
'Consumer dispute' means a dispute where the person against whom a
complaint has been made, denies and disputes the allegations contained in the
complaint.
b) Consumer disputes redressal agencies
Consumer disputes redressal agencies are established in each district and
state and at national level.
i. District Forum: The forum has jurisdiction to entertain complaints,
where value of the goods or services and the compensation claimed is up
to Rs. 20 lakhs The District Forum is empowered to send its order/decree
for execution to appropriate Civil Court.
ii. State Commission: This redressal authority has original, appellate and
supervisory jurisdiction. It entertains appeals from the District Forum. It
also has original jurisdiction to entertain complaints where the value of
goods/service and compensation, if any claimed exceeds Rs. 20 lakhs but
does not exceed Rs. 100 lakhs. Other powers and authority are similar to
those of the District Forum.
iii. National Commission: The final authority established under the Act is
the National Commission. It has original; appellate as well as supervisory
jurisdiction. It can hear the appeals from the order passed by the State
Commission and in its original jurisdiction it will entertain disputes,
where goods/services and the compensation claimed exceeds Rs.100
lakhs. It has supervisory jurisdiction over State Commission.
All the three agencies have powers of a Civil Court.
c) Procedure for filing a complaint
The procedure for filing a complaint for the three redressal agencies
mentioned above is very simple. There is no fee for filing a complaint or
filing an appeal whether before the State Commission or National
Commission.
The complaint can be filed by the complainant himself or by his authorised
agent. It can be filed personally or can even be sent by post. It may be
noted that no advocate is necessary for the purpose of filing a complaint.
d) Consumer Forum orders
If the forum is satisfied that the goods complained against suffer from any of
the defects specified in the complaint or that any of the allegations
contained in the complaint about the services are proved, the forum can
issue an order directing the opposite party to do one or more of the
following namely,
i. To return to the complainant the price, [or premium in case of
insurance], the charges paid by the complainant
ii. To award such amount as compensation to the consumers for any loss or
injury suffered by the consumer due to negligence of the opposite party
iii. To remove the defects or deficiencies in the services in question
iv. To discontinue the unfair trade practice or the restrictive trade
practice or not to repeat them
v. To provide for adequate costs to parties
e) Consumer disputes categories
The majority of consumer disputes with the three forums fall in the
following main categories, as far as the insurance business is concerned:
i. Delay in settlement of claims
ii. Non-settlement of claims
iii. Repudiation of claims
iv. Quantum of loss
v. Policy terms, conditions etc
Retail Banking mcqs
Q.1. What is retail Banking?
a. Banking targetted at corporates
b. Banking focused towards weaker class segment
c. Banking deals with individuals and lends them money
d. Banking deals with wholesalers for deposits source
e. Both (a) and (c)
Q.2. Characteristics of retail banking?
a) Targeted at individual customers, and mass market segment
b) Offer various liability, assets and service products to individuals
c) Both (a) and c)
d) Delivery model of ATMs/internet and mobile banking
e) All above
Q.3. What are the advantages of retail Banking?
a) Spread of risk across customers /customers loyalty and attractive interest spreads.
b) Spread of credit risk to diversified customers and lesser volatility in demand and credit cycle
c) Large number of customers with selection possibility by scroing system.
d) Both and (a) and (c)
e) Both (d) and (b)
Q.4. Mark the problems in retail banking?
(a) Managing large number of customers and /or rapid evolution of services.
(b) Costs of maintaining low value transactions, (c) Higher
(d) delinquencies is unsecured retail loans and credit card receivables. All of above
(e) Both (a) and (c)
Q.5. Reasons for retail banking in India are :-
(a) Growing urban population/higher disposable income/increase in mass affluents space and explosion of service economy. (b)
Foreign banks and private sector banks seriously looking at the bottom of customers alongwith credit and debit cards
receivables. (c) Despite credit and deposits growth, banking access remains limited to few sections of the population, (d) Both
(b) and (c), (e) Both (a) + (b)
Q.6.Which is relevant to bank's balance sheet?
(a) ABSA (b) NASA (c) CASA (d) NBFC
Q.7.Define the retail assets under Retail Banking?
(a) Housing loans/consumer durables /credit card receivable
(b) Auto loans/personal loans/loan against shares and debenture
(c) ECS Loans/EFT Loans/CASA Loans
(d) Both (a) and (c)
(e) Both (a) and (b) only
Q.8. Which is highest in number of commercial banks in India?
a) Branches
b) ATMs
c) Extension Counters
d) Mobile Banking
e) Internet Banking
Q.9. What is the contribution of bank's retail assets to Gross Domestic Product (GDP) in India?
( a ) 6 % ( b ) 1 5 % ( c ) 3 3 % ( d ) 2 4 % ( e ) 3 %
Q.10. What is not a constraint in Retail Banking?
a. Managing large number of clients in absence of ROBUST IT system
b. Rapid evolution of services
c. Maintaining ATMs centres with low costs
d. Unsecured retail loans and credit and receivables amount
Q.11. What is business model for retail banking in India?
a. Strategic business unit approach
b. Departmental Approach
c. Integrated approach
d. Any one of above
e. Both (a) and (b) only
Q.12. Give the names of foreign banks which entered the retail banking activities butwhen notableto achieve the business objectives moved out of business?
a. BNP Paribas
b. American Express
c. ABN Amro (Now RSB) bank
d. Citi Bank
e. All (a) to (c)
Q.13. In retail banking which business model is adopted generally by Public Sector Banks?
a. Strategic Business Unit
b. Departmental Approach
c. Integrated Approach
d. Management by Objective Approach
Q.14. Which business model in retail banking is do adopt by new generation private sector banks
a) Strategic business unit approach
b) Departmental Approach
c) Integrated approach (part of overall business plan)
(d) Management by Objective Approach
Q.15. During 1990s, certain foreign banks went for business model in retail banking, but after certain years?
a. Continued with their business inspite of being unprofitable
b. Changed their focus with some strategic changes
c. Movedout of the business
d. None of above
Q.16. Discuss the liability products offered to retail banking customers?
a. Savings Accounts
b. Current Accounts/Term deposit accounts
c. Housing Loans/consumer durables/auto loans/credit-cards easy payments
d. Both (a) + (b)
e. All (a) to (c)
Q.17. In Liability products of retail banking what are different value propositions?
a) ATMs/Debit cards/Credit Cards/Multicity cheques, built in with savings A/c
b) Internet banking/phone banking/mobile banking tagging group insurance products to life and non-life/money sweep facilities from savings to fixed
deposits.
c) Both (a) and (b)
d) Auto overdraft facility only
Q.18. Retail asset financing is a major component of retail banking. Discuss what are those assets?
a. Housing Loans/Loan against rental receivables
b. Consumer durable loans /credit cards/salary overdraft
c. Auto loans/personal loans/loans against securities
d. All above
e. Only (a) and (c)
Q.19. Discuss the other services which are tagged under retail banking?
a) Housing loan/consumer durables loan/auto loans/personal loan/ credit card receivables
b) Saving/term/current deposits
c) Debit Cards/ATM cards/telephone banking/mobile banking
d) Internet banking/demat services/brooking services/insurance policies/mutual funds/sale of gold coins/wealth management services
e) Both (a) and (c)
Q.20. Processing of services in retail banking is basically approached, from which dimension?
a. In-house resource
b. Some products processed in house and some are outsourced
c. Outsourcing of entire process
d. AU above
Q2I. The entire process for products and services in retail banking is done though in house resource by which category of
banks?
a. Public Sector Bank (PSB)
b. Old Private Sector and PSBs
c. New Private Sector Banks
d. Foreign Banks
Q.22. Banks adopt different process models for retail asset products and services, to build absolute process efficiencies?
a. Centralised retail asset processing centres
b. Centralised processing for some assets only
c. Regional processing hubs
d. Stand alone processing at branches (e) Any of above
Q.23. What are the process models which commonly banks adopt for retail liability?
a. Centralised processing for opening of account/issue of PB/ Cheque book/ATM card
b. Regional processing Hubs, all above activities
c. Opening of SB A/cs at branches add issue of PB and cheque book/ ATM Cards/PIN Mailers also at the stand alone,
(d) Any of above
Q.24. In pricing of products and services is based on certain fundamental parameters. Which are those parameters?
a) Market dynamics/risk perception/return expectations/customer profile
b) Tenor/duration/resources position/asset-liability management position
c) Any of above
d) Both (a) and (b)
25. Pricing of products and services in banks is mainly driven on the basis of bases?
a. Asset Liability Management
b. Regulatory advices from RBI
c. Structured step up pricing practice
d. Both (a) and (b)
Q.26. Price structuring for products and services is attempted by banks in the following ways -
(a) Stand alone pricing for different services
(b) Special concessional quotes for high net worth depositors and retail depositors
(c) Bundled pricing/Holistic pricing based on total relationship (d) All above (e) Any of above
Q.27. Why structuring is adopted by banks in retail banking?
Offer holistic pricing across of specific bundling of services so the total price proposition becomes attractive customer
Offer holistic pricing across of specific bundling of services so the total price proposition becomes profitable to bank
Offer holistic pricing across of specific bundling of services so the total price proposition becomes attractive to high net worth clients only d) All above
Q.28. Which category of banks adopt price bundling of product and services?
(a) Public sector banks (b) Private sector banks
(c) Foreign banks
(d) Both (b) and (c)
Q.29. Public sector banks (nationalised + IDBI bank + SBI and 5 associates and Bhartiya Mahilla Bank Ltd.) have price concerns as well as rebates in
pricing structure. What is the basis of its application?
a) Volumes of transaction
b) Quantum
c) Relationship with bank d) All above
30. Banks do have structure for pricing additional models. Under it what are benefits made available to customers other than rebates of discounts as
alternative pricing propositions?
(a) Free remittance facilities
(b) Issue of demand drafts free of charges
(c) Waiver of service or processing charges (d) All above e) Any of above
Q.31. Technology and retail banking are inseparable. Technology is the enabler for building and translating a customer data base into retail banking business. Such data are
usable to
a. Increase the scope for cross selling
b. Increase the scope for up-selling
c. Get due about the level to which data base is organised
d. aII above
e. Any one of above
Q.32. Distinguish retail banking with corporate banking and state which is retail banking?
a. Individuals segment/mass market/business to customer approach
b. Wholesale clients/smaller segment/business to business approach
c. High ticket size/high risk/low returns/monitoring less laborious
high deposit cost
(d) Both (b) and (c)
Q.33. What special features are there in retail banking compared to wholesale banking?
a) Low NPA impact
b) Cost of deposits lesser
c) Monitoring of advances less laborious
d) Both (a) and (b)
Q.34. To which type of banking we get higher returns/lesser risk/cheaper cost of deposits/impact of NPA lesser/Low ticket size of loan etc.?
a. Retail Banking
b. Wholesale Banking
c. B2B Banking
(d) Corporate Banking
Q.35. What is the latest level of technology in Public Sector Banks?
ALPM
a) Single Server environment
b) Core banking solution, C) single platform environment (d) Truncation
Q.36. Which implementation model banks adopt in retail banking processes?
a. Horizontally organised model
b. Vertically organised model
c. Predominantly vertically organised model
d. Predominantly Horizontally organised model
e. Anyone of above
Q.37. When is the horizontal model adopted in retail banking?
a. Level of customer information available in a single platform
b. Offering multiple products/services
c. Offering services across assets, liabilities and other services
d. All of above
Q.38. When the vertically organised model provides functionality under retail banking?
a) Centralised Tistomer data base
b) Common informations availability to other models
c) Scope for enlarging the scope for cross-selling and up selling d )All above
Q.39. Which concept of retail banking is adopted under standard norm by PSBs in India?
a. Horizontally organised model
b. Vertically organised model
c. Predominantly vertically organised model
d. Predominantly horizontally organised model
Q.40. What are the basic structure of retail banking?
a) Retail Assets
b) Retail Liability ,c )Third Party Products, d) All above
ANSWER
1 C 2 E 3 E 4 D 5 D 6 A 7 E 8 B 9 A 10 C
11 D 12 E 13 B 14 A 15 C 16 D 17 C 18 E 19 E 20 D
21 B 22 E 23 C 24 D 25 D 26 D 27 A 28 D 29 D 30 D
31 D 32 A 33 D 34 A 35 C 36 E 37 D 38 D 39 A 40 D
a. Banking targetted at corporates
b. Banking focused towards weaker class segment
c. Banking deals with individuals and lends them money
d. Banking deals with wholesalers for deposits source
e. Both (a) and (c)
Q.2. Characteristics of retail banking?
a) Targeted at individual customers, and mass market segment
b) Offer various liability, assets and service products to individuals
c) Both (a) and c)
d) Delivery model of ATMs/internet and mobile banking
e) All above
Q.3. What are the advantages of retail Banking?
a) Spread of risk across customers /customers loyalty and attractive interest spreads.
b) Spread of credit risk to diversified customers and lesser volatility in demand and credit cycle
c) Large number of customers with selection possibility by scroing system.
d) Both and (a) and (c)
e) Both (d) and (b)
Q.4. Mark the problems in retail banking?
(a) Managing large number of customers and /or rapid evolution of services.
(b) Costs of maintaining low value transactions, (c) Higher
(d) delinquencies is unsecured retail loans and credit card receivables. All of above
(e) Both (a) and (c)
Q.5. Reasons for retail banking in India are :-
(a) Growing urban population/higher disposable income/increase in mass affluents space and explosion of service economy. (b)
Foreign banks and private sector banks seriously looking at the bottom of customers alongwith credit and debit cards
receivables. (c) Despite credit and deposits growth, banking access remains limited to few sections of the population, (d) Both
(b) and (c), (e) Both (a) + (b)
Q.6.Which is relevant to bank's balance sheet?
(a) ABSA (b) NASA (c) CASA (d) NBFC
Q.7.Define the retail assets under Retail Banking?
(a) Housing loans/consumer durables /credit card receivable
(b) Auto loans/personal loans/loan against shares and debenture
(c) ECS Loans/EFT Loans/CASA Loans
(d) Both (a) and (c)
(e) Both (a) and (b) only
Q.8. Which is highest in number of commercial banks in India?
a) Branches
b) ATMs
c) Extension Counters
d) Mobile Banking
e) Internet Banking
Q.9. What is the contribution of bank's retail assets to Gross Domestic Product (GDP) in India?
( a ) 6 % ( b ) 1 5 % ( c ) 3 3 % ( d ) 2 4 % ( e ) 3 %
Q.10. What is not a constraint in Retail Banking?
a. Managing large number of clients in absence of ROBUST IT system
b. Rapid evolution of services
c. Maintaining ATMs centres with low costs
d. Unsecured retail loans and credit and receivables amount
Q.11. What is business model for retail banking in India?
a. Strategic business unit approach
b. Departmental Approach
c. Integrated approach
d. Any one of above
e. Both (a) and (b) only
Q.12. Give the names of foreign banks which entered the retail banking activities butwhen notableto achieve the business objectives moved out of business?
a. BNP Paribas
b. American Express
c. ABN Amro (Now RSB) bank
d. Citi Bank
e. All (a) to (c)
Q.13. In retail banking which business model is adopted generally by Public Sector Banks?
a. Strategic Business Unit
b. Departmental Approach
c. Integrated Approach
d. Management by Objective Approach
Q.14. Which business model in retail banking is do adopt by new generation private sector banks
a) Strategic business unit approach
b) Departmental Approach
c) Integrated approach (part of overall business plan)
(d) Management by Objective Approach
Q.15. During 1990s, certain foreign banks went for business model in retail banking, but after certain years?
a. Continued with their business inspite of being unprofitable
b. Changed their focus with some strategic changes
c. Movedout of the business
d. None of above
Q.16. Discuss the liability products offered to retail banking customers?
a. Savings Accounts
b. Current Accounts/Term deposit accounts
c. Housing Loans/consumer durables/auto loans/credit-cards easy payments
d. Both (a) + (b)
e. All (a) to (c)
Q.17. In Liability products of retail banking what are different value propositions?
a) ATMs/Debit cards/Credit Cards/Multicity cheques, built in with savings A/c
b) Internet banking/phone banking/mobile banking tagging group insurance products to life and non-life/money sweep facilities from savings to fixed
deposits.
c) Both (a) and (b)
d) Auto overdraft facility only
Q.18. Retail asset financing is a major component of retail banking. Discuss what are those assets?
a. Housing Loans/Loan against rental receivables
b. Consumer durable loans /credit cards/salary overdraft
c. Auto loans/personal loans/loans against securities
d. All above
e. Only (a) and (c)
Q.19. Discuss the other services which are tagged under retail banking?
a) Housing loan/consumer durables loan/auto loans/personal loan/ credit card receivables
b) Saving/term/current deposits
c) Debit Cards/ATM cards/telephone banking/mobile banking
d) Internet banking/demat services/brooking services/insurance policies/mutual funds/sale of gold coins/wealth management services
e) Both (a) and (c)
Q.20. Processing of services in retail banking is basically approached, from which dimension?
a. In-house resource
b. Some products processed in house and some are outsourced
c. Outsourcing of entire process
d. AU above
Q2I. The entire process for products and services in retail banking is done though in house resource by which category of
banks?
a. Public Sector Bank (PSB)
b. Old Private Sector and PSBs
c. New Private Sector Banks
d. Foreign Banks
Q.22. Banks adopt different process models for retail asset products and services, to build absolute process efficiencies?
a. Centralised retail asset processing centres
b. Centralised processing for some assets only
c. Regional processing hubs
d. Stand alone processing at branches (e) Any of above
Q.23. What are the process models which commonly banks adopt for retail liability?
a. Centralised processing for opening of account/issue of PB/ Cheque book/ATM card
b. Regional processing Hubs, all above activities
c. Opening of SB A/cs at branches add issue of PB and cheque book/ ATM Cards/PIN Mailers also at the stand alone,
(d) Any of above
Q.24. In pricing of products and services is based on certain fundamental parameters. Which are those parameters?
a) Market dynamics/risk perception/return expectations/customer profile
b) Tenor/duration/resources position/asset-liability management position
c) Any of above
d) Both (a) and (b)
25. Pricing of products and services in banks is mainly driven on the basis of bases?
a. Asset Liability Management
b. Regulatory advices from RBI
c. Structured step up pricing practice
d. Both (a) and (b)
Q.26. Price structuring for products and services is attempted by banks in the following ways -
(a) Stand alone pricing for different services
(b) Special concessional quotes for high net worth depositors and retail depositors
(c) Bundled pricing/Holistic pricing based on total relationship (d) All above (e) Any of above
Q.27. Why structuring is adopted by banks in retail banking?
Offer holistic pricing across of specific bundling of services so the total price proposition becomes attractive customer
Offer holistic pricing across of specific bundling of services so the total price proposition becomes profitable to bank
Offer holistic pricing across of specific bundling of services so the total price proposition becomes attractive to high net worth clients only d) All above
Q.28. Which category of banks adopt price bundling of product and services?
(a) Public sector banks (b) Private sector banks
(c) Foreign banks
(d) Both (b) and (c)
Q.29. Public sector banks (nationalised + IDBI bank + SBI and 5 associates and Bhartiya Mahilla Bank Ltd.) have price concerns as well as rebates in
pricing structure. What is the basis of its application?
a) Volumes of transaction
b) Quantum
c) Relationship with bank d) All above
30. Banks do have structure for pricing additional models. Under it what are benefits made available to customers other than rebates of discounts as
alternative pricing propositions?
(a) Free remittance facilities
(b) Issue of demand drafts free of charges
(c) Waiver of service or processing charges (d) All above e) Any of above
Q.31. Technology and retail banking are inseparable. Technology is the enabler for building and translating a customer data base into retail banking business. Such data are
usable to
a. Increase the scope for cross selling
b. Increase the scope for up-selling
c. Get due about the level to which data base is organised
d. aII above
e. Any one of above
Q.32. Distinguish retail banking with corporate banking and state which is retail banking?
a. Individuals segment/mass market/business to customer approach
b. Wholesale clients/smaller segment/business to business approach
c. High ticket size/high risk/low returns/monitoring less laborious
high deposit cost
(d) Both (b) and (c)
Q.33. What special features are there in retail banking compared to wholesale banking?
a) Low NPA impact
b) Cost of deposits lesser
c) Monitoring of advances less laborious
d) Both (a) and (b)
Q.34. To which type of banking we get higher returns/lesser risk/cheaper cost of deposits/impact of NPA lesser/Low ticket size of loan etc.?
a. Retail Banking
b. Wholesale Banking
c. B2B Banking
(d) Corporate Banking
Q.35. What is the latest level of technology in Public Sector Banks?
ALPM
a) Single Server environment
b) Core banking solution, C) single platform environment (d) Truncation
Q.36. Which implementation model banks adopt in retail banking processes?
a. Horizontally organised model
b. Vertically organised model
c. Predominantly vertically organised model
d. Predominantly Horizontally organised model
e. Anyone of above
Q.37. When is the horizontal model adopted in retail banking?
a. Level of customer information available in a single platform
b. Offering multiple products/services
c. Offering services across assets, liabilities and other services
d. All of above
Q.38. When the vertically organised model provides functionality under retail banking?
a) Centralised Tistomer data base
b) Common informations availability to other models
c) Scope for enlarging the scope for cross-selling and up selling d )All above
Q.39. Which concept of retail banking is adopted under standard norm by PSBs in India?
a. Horizontally organised model
b. Vertically organised model
c. Predominantly vertically organised model
d. Predominantly horizontally organised model
Q.40. What are the basic structure of retail banking?
a) Retail Assets
b) Retail Liability ,c )Third Party Products, d) All above
ANSWER
1 C 2 E 3 E 4 D 5 D 6 A 7 E 8 B 9 A 10 C
11 D 12 E 13 B 14 A 15 C 16 D 17 C 18 E 19 E 20 D
21 B 22 E 23 C 24 D 25 D 26 D 27 A 28 D 29 D 30 D
31 D 32 A 33 D 34 A 35 C 36 E 37 D 38 D 39 A 40 D
Facilities for Non-resident Indians (NRIs)
Facilities for Non-resident Indians (NRIs)
Purpose
v) To hedge the exchange rate risk on the market value of investment made under the
portfolio scheme in accordance with provisions of FERA, 1973 or under notifications issued
there under or in accordance with provisions of FEMA, 1999. For access to ETCD market, see para. 4 below. vi) To hedge the exchange rate risk on the amount of dividend due on shares held in Indian
companies. vii) To hedge the exchange rate risk on the amounts held in FCNR (B) deposits. viii) To hedge the exchange rate risk on balances held in NRE account. Products
ix) Forward foreign exchange contracts with rupee as one of the currencies, and foreign currency-
INR options. x) Additionally, for balances in FCNR (B) accounts – Cross currency (not involving the rupee)
forward contracts to convert the balances in one foreign currency to other foreign currencies in
which FCNR (B) deposits are permitted to be maintained. (c)Terms
9 and conditions for Non-Resident Indians (NRIs) participating in the Exchange
Traded Currency Derivatives (ETCD)
i. NRIs shall designate an AD Cat-I bank for the purpose of monitoring and reporting their combined
positions in the OTC and ETCD segment
(an)NRIs may take positions in the currency futures / exchange traded options market to hedge the
currency risk on the market value of their permissible (under FEMA, 1999) Rupee investments in
debt and equity and dividend due and balances held in NRE accounts. (ao)The exchange/ clearing corporation will provide details of all transactions of the NRI to the
designated bank. (ap)The designated bank will consolidate the positions of the NRI on the exchanges as well as the
OTC derivative contracts booked with them and with other AD banks. The designated bank shall
monitor the aggregate positions and ensure the existence of underlying Rupee currency risk and
bring transgressions, if any, to the notice of RBI / SEBI. (aq)The onus of ensuring the existence of the underlying exposure shall rest with the NRI
concerned. If the magnitude of exposure through the hedge transactions exceeds the magnitude of
underlying exposure, the concerned NRI shall be liable to such penal action as may be taken by
Reserve Bank of India under the Foreign Exchange Management Act (FEMA), 1999.
Purpose
v) To hedge the exchange rate risk on the market value of investment made under the
portfolio scheme in accordance with provisions of FERA, 1973 or under notifications issued
there under or in accordance with provisions of FEMA, 1999. For access to ETCD market, see para. 4 below. vi) To hedge the exchange rate risk on the amount of dividend due on shares held in Indian
companies. vii) To hedge the exchange rate risk on the amounts held in FCNR (B) deposits. viii) To hedge the exchange rate risk on balances held in NRE account. Products
ix) Forward foreign exchange contracts with rupee as one of the currencies, and foreign currency-
INR options. x) Additionally, for balances in FCNR (B) accounts – Cross currency (not involving the rupee)
forward contracts to convert the balances in one foreign currency to other foreign currencies in
which FCNR (B) deposits are permitted to be maintained. (c)Terms
9 and conditions for Non-Resident Indians (NRIs) participating in the Exchange
Traded Currency Derivatives (ETCD)
i. NRIs shall designate an AD Cat-I bank for the purpose of monitoring and reporting their combined
positions in the OTC and ETCD segment
(an)NRIs may take positions in the currency futures / exchange traded options market to hedge the
currency risk on the market value of their permissible (under FEMA, 1999) Rupee investments in
debt and equity and dividend due and balances held in NRE accounts. (ao)The exchange/ clearing corporation will provide details of all transactions of the NRI to the
designated bank. (ap)The designated bank will consolidate the positions of the NRI on the exchanges as well as the
OTC derivative contracts booked with them and with other AD banks. The designated bank shall
monitor the aggregate positions and ensure the existence of underlying Rupee currency risk and
bring transgressions, if any, to the notice of RBI / SEBI. (aq)The onus of ensuring the existence of the underlying exposure shall rest with the NRI
concerned. If the magnitude of exposure through the hedge transactions exceeds the magnitude of
underlying exposure, the concerned NRI shall be liable to such penal action as may be taken by
Reserve Bank of India under the Foreign Exchange Management Act (FEMA), 1999.
Current Affairs on August 28th 2018
Today's Headlines from www:
*Economic Times*
📝 Tata Steel on a gender-diversity drive, aims to have 20% female staff in 5 years
📝 Rupee dives to new closing low of 70.16 vs dollar
📝 Berkshire confirms investment in Paytm; Buffett not involved
📝 CP issuance hits all-time high of Rs 4.92L cr in Q1: Icra
📝 Union steel ministry launches Corporate Sports Policy for CPSEs
📝 Suresh Prabhu asks traders to carve out plans for 20% growth in exports
📝 JNPT, Railways & states to sign MoU for Rs 8,574 crore rail project
📝 SHRI group to invest Rs 600 crore on new affordable housing project in Greater Noida
*Business Standard*
📝 Sensex extends record run; Fed says policy tightening pace will be gradual
📝 Total to exit from Hazira LNG venture; to sell 26% stake to Shell
📝 Gautam Adani's energy unit set to acquire GMR thermal power plant
📝 NMDC increases price of lump ore, iron ore fines by Rs 150 a tonne
📝 SBI changes names, IFSC codes of nearly 1,300 branches post merger
📝 India approves use of drones; puts restrictions on delivery of goods, food
📝 Diesel at record high of Rs 69.46 a litre, petrol inches towards Rs 78 mark
*Financial Express*
📝 Banks get 15-day window to resolve stressed assets
📝 SBI plans to divest up to 4% in SBI General Insurance ahead of IPO
📝 China cuts steel exports to India, may target domestic market for growth
📝 Kerala deluge may shave off 2.2% of state GDP, push up fiscal deficit to 5.4%
📝 FDI growth up 23 percent in April-June quarter this fiscal
📝 Japan’s Rakuten details plan to fight back against Amazon, SoftBank
📝 Turkey’s battered lira tumbles again over outlook fears
*Mint*
📝 Jet Airways drafts revival plan after ₹1,323 crore Q1 loss
📝 Shell Gas to acquire Total’s 26% stake in Hazira LNG and Port
📝 SBI seeks to sell other banks’ exposures in Bombay Rayon
📝 KKR to bail out JBF Industries, will buy its petrochemical unit
📝 AION Cap targets $1 billion corpus for new fund
📝 Cap independent directors’ pay from a company to 20%: Govt panel
📝 US, Mexico reach trade deal as Canada may rejoin Nafta talks.
*Economic Times*
📝 Tata Steel on a gender-diversity drive, aims to have 20% female staff in 5 years
📝 Rupee dives to new closing low of 70.16 vs dollar
📝 Berkshire confirms investment in Paytm; Buffett not involved
📝 CP issuance hits all-time high of Rs 4.92L cr in Q1: Icra
📝 Union steel ministry launches Corporate Sports Policy for CPSEs
📝 Suresh Prabhu asks traders to carve out plans for 20% growth in exports
📝 JNPT, Railways & states to sign MoU for Rs 8,574 crore rail project
📝 SHRI group to invest Rs 600 crore on new affordable housing project in Greater Noida
*Business Standard*
📝 Sensex extends record run; Fed says policy tightening pace will be gradual
📝 Total to exit from Hazira LNG venture; to sell 26% stake to Shell
📝 Gautam Adani's energy unit set to acquire GMR thermal power plant
📝 NMDC increases price of lump ore, iron ore fines by Rs 150 a tonne
📝 SBI changes names, IFSC codes of nearly 1,300 branches post merger
📝 India approves use of drones; puts restrictions on delivery of goods, food
📝 Diesel at record high of Rs 69.46 a litre, petrol inches towards Rs 78 mark
*Financial Express*
📝 Banks get 15-day window to resolve stressed assets
📝 SBI plans to divest up to 4% in SBI General Insurance ahead of IPO
📝 China cuts steel exports to India, may target domestic market for growth
📝 Kerala deluge may shave off 2.2% of state GDP, push up fiscal deficit to 5.4%
📝 FDI growth up 23 percent in April-June quarter this fiscal
📝 Japan’s Rakuten details plan to fight back against Amazon, SoftBank
📝 Turkey’s battered lira tumbles again over outlook fears
*Mint*
📝 Jet Airways drafts revival plan after ₹1,323 crore Q1 loss
📝 Shell Gas to acquire Total’s 26% stake in Hazira LNG and Port
📝 SBI seeks to sell other banks’ exposures in Bombay Rayon
📝 KKR to bail out JBF Industries, will buy its petrochemical unit
📝 AION Cap targets $1 billion corpus for new fund
📝 Cap independent directors’ pay from a company to 20%: Govt panel
📝 US, Mexico reach trade deal as Canada may rejoin Nafta talks.
Monday, 27 August 2018
Mutual funds short notes 6
Chapter 11
• The costs mentioned above, in today’s terms, need to be translated into the rupee
requirement in future. This is done using the formula A = P X (1 + i)n, where, A = Rupee
requirement in future, P = Cost in today’s terms, i = inflation & n = Number of years into
the future, when the expense will be incurred.
• The steps in creating a comprehensive financial plan, as proposed by the
Certified Financial Planner – Board of Standards (USA) are as follows:
a. Establish and Define the Client-Planner Relationship
b. Gather Client Data, Define Client Goals
c. Analyse and Evaluate Client’s Financial Status
d. Develop and Present Financial Planning Recommendations and / or
Options
e. Implement the Financial Planning Recommendations
f. Monitor the Financial Planning Recommendations
• During the Childhood stage, focus is on education in most cases. Children
are dependents, rather than earning members. Pocket money, cash gifts
and scholarships are potential sources of income during this phase. Parents
and seniors need to groom children to imbibe the virtues of savings,
balance and prudence. Values imbibed during this phase set the foundation
of their life in future.
• Equity SIPs and Whole-life insurance plans are great ways to force the
young unmarried into the habit of regular savings, rather than lavish the
money away.
• Young Married,where both spouses have decent jobs, life can be financially
comfortable. They can plan where to stay in / buy a house, based on job
imperatives, life style aspirations and personal comfort. Insurance is
required, but not so critical. Where only one spouse is working, life
insurance to provide for contingencies associated with the earning spouse
are absolutely critical. In case the earning spouse is not so well placed,
ability to pay insurance premia can be an issue, competing with other basic
needs of food, clothing and shelter. In such cases, term insurance (where
premium is lower) possibilities have to be seriously explored and locked
into.
• Accumulation is the stage when the investor gets to build his wealth. It
covers the earning years of the investor i.e. the phases of the life cycle from
Young Unmarried to Pre-Retirement.
• Transition is a phase when financial goals are in the horizon. E.g. house to
be purchased, children’s higher education / marriage approaching etc.
Given the impending requirement of funds, investors tend to increase the
proportion of their portfolio in liquid assets viz. money in bank, liquid
schemes etc.
• During inter-generational transfer, the investor starts thinking about
orderly transfer of wealth to the next generation, in the event of death.
The financial planner can help the investor understand various inheritance
and tax issues, and help in preparing Will and validating various documents
and structures related to assets and liabilities of the investor.
• Reaping/Distribution is the stage when the investor needs regular money.
Hence, investors in this stage need to have higher allocation to income
generating assets. It is the parallel of retirement phase in the Life Cycle.
• Winning lotteries, unexpected inheritance of wealth, unusually high capital
gains earned – all these are occasions of sudden wealth, that need to be
celebrated. However, given the human nature of frittering away such
sudden wealth, the financial planner can channelize the wealth into
investments, for the long term benefit of the investor’s family.
Chapter 12
• Risk profiling is an approach to understand the risk appetite of investors
- an essential pre-requisite to advise investors on their investments.
• The investment advice is dependent on understanding both aspects of
risk: Risk appetite of the investor & Risk level of the investment options
being considered.
• Risk appetite increases as the number of earning member increases and
vice-versa.
• Risk appetite is higher if life expectancy is longer
• Lower the age, higher the risk that can be taken and vice-versa
• Well qualified and multi-skilled professionals can afford to take more
risk.
• Those with steady jobs are better positioned to take risk
• Higher the capital base, better the ability to take financially the
downsides that come with risk.
• The distribution of an investor’s portfolio between different asset
classes is called asset allocation.
• Strategic Asset Allocation is the ideal that comes out of the risk profile
of the individual. Risk profiling is key to deciding on the strategic asset
allocation. The most simplistic risk profiling thumb rule is to have as
much debt in the portfolio, as the number of years of age.
• Tactical Asset Allocation is the decision that comes out of calls on the
likely behaviour of the market. An investor who decides to go
overweight on equities i.e. take higher exposure to equities, because of
expectations of buoyancy in industry and share markets, is taking a
tactical asset allocation call. Tactical asset allocation is suitable only for
seasoned investors operating with large investible surpluses.
• The costs mentioned above, in today’s terms, need to be translated into the rupee
requirement in future. This is done using the formula A = P X (1 + i)n, where, A = Rupee
requirement in future, P = Cost in today’s terms, i = inflation & n = Number of years into
the future, when the expense will be incurred.
• The steps in creating a comprehensive financial plan, as proposed by the
Certified Financial Planner – Board of Standards (USA) are as follows:
a. Establish and Define the Client-Planner Relationship
b. Gather Client Data, Define Client Goals
c. Analyse and Evaluate Client’s Financial Status
d. Develop and Present Financial Planning Recommendations and / or
Options
e. Implement the Financial Planning Recommendations
f. Monitor the Financial Planning Recommendations
• During the Childhood stage, focus is on education in most cases. Children
are dependents, rather than earning members. Pocket money, cash gifts
and scholarships are potential sources of income during this phase. Parents
and seniors need to groom children to imbibe the virtues of savings,
balance and prudence. Values imbibed during this phase set the foundation
of their life in future.
• Equity SIPs and Whole-life insurance plans are great ways to force the
young unmarried into the habit of regular savings, rather than lavish the
money away.
• Young Married,where both spouses have decent jobs, life can be financially
comfortable. They can plan where to stay in / buy a house, based on job
imperatives, life style aspirations and personal comfort. Insurance is
required, but not so critical. Where only one spouse is working, life
insurance to provide for contingencies associated with the earning spouse
are absolutely critical. In case the earning spouse is not so well placed,
ability to pay insurance premia can be an issue, competing with other basic
needs of food, clothing and shelter. In such cases, term insurance (where
premium is lower) possibilities have to be seriously explored and locked
into.
• Accumulation is the stage when the investor gets to build his wealth. It
covers the earning years of the investor i.e. the phases of the life cycle from
Young Unmarried to Pre-Retirement.
• Transition is a phase when financial goals are in the horizon. E.g. house to
be purchased, children’s higher education / marriage approaching etc.
Given the impending requirement of funds, investors tend to increase the
proportion of their portfolio in liquid assets viz. money in bank, liquid
schemes etc.
• During inter-generational transfer, the investor starts thinking about
orderly transfer of wealth to the next generation, in the event of death.
The financial planner can help the investor understand various inheritance
and tax issues, and help in preparing Will and validating various documents
and structures related to assets and liabilities of the investor.
• Reaping/Distribution is the stage when the investor needs regular money.
Hence, investors in this stage need to have higher allocation to income
generating assets. It is the parallel of retirement phase in the Life Cycle.
• Winning lotteries, unexpected inheritance of wealth, unusually high capital
gains earned – all these are occasions of sudden wealth, that need to be
celebrated. However, given the human nature of frittering away such
sudden wealth, the financial planner can channelize the wealth into
investments, for the long term benefit of the investor’s family.
Chapter 12
• Risk profiling is an approach to understand the risk appetite of investors
- an essential pre-requisite to advise investors on their investments.
• The investment advice is dependent on understanding both aspects of
risk: Risk appetite of the investor & Risk level of the investment options
being considered.
• Risk appetite increases as the number of earning member increases and
vice-versa.
• Risk appetite is higher if life expectancy is longer
• Lower the age, higher the risk that can be taken and vice-versa
• Well qualified and multi-skilled professionals can afford to take more
risk.
• Those with steady jobs are better positioned to take risk
• Higher the capital base, better the ability to take financially the
downsides that come with risk.
• The distribution of an investor’s portfolio between different asset
classes is called asset allocation.
• Strategic Asset Allocation is the ideal that comes out of the risk profile
of the individual. Risk profiling is key to deciding on the strategic asset
allocation. The most simplistic risk profiling thumb rule is to have as
much debt in the portfolio, as the number of years of age.
• Tactical Asset Allocation is the decision that comes out of calls on the
likely behaviour of the market. An investor who decides to go
overweight on equities i.e. take higher exposure to equities, because of
expectations of buoyancy in industry and share markets, is taking a
tactical asset allocation call. Tactical asset allocation is suitable only for
seasoned investors operating with large investible surpluses.
Current Affairs on August 27th 2018
Today's Headlines from www:
*Economic Times*
📝 Government looks to meet 75% of FY19 selloff target by December
📝 Bankers burn midnight oil to resolve Rs 3.8 tln NPAs
📝 FPIs stay bullish on India, invest Rs 6,700 crore in Aug
📝 ISRO will complete Gaganyaan mission as per schedule: Raghavan
📝 Apollo tyres plans $1bn investments to dethrone MRF
📝 NITI Aayog to review progress of standardisation of Metro rail systems
📝 NBFCs to see up to 35-40% rise in hiring in next 1 yr, say experts
📝 Big willful defaulters' dues to PNB drop to Rs 15,175 crore in July
*Business Standard*
📝 Amazon plans to invest $700 million in Kishore Biyani's Future Group
📝 Budget hospitality start-up OYO is replicating its India strategy in China
📝 Coke to counter growing competition from local brands with refreshed RimZim
📝 Worst may be over for Indian bonds; RBI done with rate hikes: HDFC Standard
📝 RBI must ensure greater participation of banks in gold imports: NITI Aayog
📝 Stressed power assets: 180-day deadline breach not end of road, say bankers
📝 Five years of Companies Act, 2013: Step-up in compliances irks India Inc
*Financial Express*
📝 UPI soars, clocks digital transactions at 43% of those by cards at retail outlets as compared to 4% last year
📝 RBI norms to limit flood impact in the near term
📝 Rocket Internet bets on lesser-known startups to repeat its earlier success
📝 51,837 industries in Delhi under National Green Tribunal scanner
📝 Jobs in corporate India fell sharply over last decade, from around 5-6% per annum then to around 2-3% today
📝 India’s logistics sector to grow to $200 bn in 3 years, government steps will take time to fructify: J Padmanabhan, Crisil
📝 Guess, US-based brand, aims to provide completely new experience in India with its large format lifestyle stores
*Mint*
📝 Govt plans to make compulsory for unlisted firms to issue shares in demat form
📝 SAIL set to exit non-performing, non-operational JV firms
📝 Sebi plans to deploy technology to beef up surveillance activities
📝 Corporate affairs ministry seeks details from crisis-hit Jet Airways
📝 Shubh Loans raises $4.2 million from Saama Capital, others
📝 Marico expects premium brands biz to double in 3-4 years
📝 Liberty House plans to turn ABG Shipyard into steel plant.
*Economic Times*
📝 Government looks to meet 75% of FY19 selloff target by December
📝 Bankers burn midnight oil to resolve Rs 3.8 tln NPAs
📝 FPIs stay bullish on India, invest Rs 6,700 crore in Aug
📝 ISRO will complete Gaganyaan mission as per schedule: Raghavan
📝 Apollo tyres plans $1bn investments to dethrone MRF
📝 NITI Aayog to review progress of standardisation of Metro rail systems
📝 NBFCs to see up to 35-40% rise in hiring in next 1 yr, say experts
📝 Big willful defaulters' dues to PNB drop to Rs 15,175 crore in July
*Business Standard*
📝 Amazon plans to invest $700 million in Kishore Biyani's Future Group
📝 Budget hospitality start-up OYO is replicating its India strategy in China
📝 Coke to counter growing competition from local brands with refreshed RimZim
📝 Worst may be over for Indian bonds; RBI done with rate hikes: HDFC Standard
📝 RBI must ensure greater participation of banks in gold imports: NITI Aayog
📝 Stressed power assets: 180-day deadline breach not end of road, say bankers
📝 Five years of Companies Act, 2013: Step-up in compliances irks India Inc
*Financial Express*
📝 UPI soars, clocks digital transactions at 43% of those by cards at retail outlets as compared to 4% last year
📝 RBI norms to limit flood impact in the near term
📝 Rocket Internet bets on lesser-known startups to repeat its earlier success
📝 51,837 industries in Delhi under National Green Tribunal scanner
📝 Jobs in corporate India fell sharply over last decade, from around 5-6% per annum then to around 2-3% today
📝 India’s logistics sector to grow to $200 bn in 3 years, government steps will take time to fructify: J Padmanabhan, Crisil
📝 Guess, US-based brand, aims to provide completely new experience in India with its large format lifestyle stores
*Mint*
📝 Govt plans to make compulsory for unlisted firms to issue shares in demat form
📝 SAIL set to exit non-performing, non-operational JV firms
📝 Sebi plans to deploy technology to beef up surveillance activities
📝 Corporate affairs ministry seeks details from crisis-hit Jet Airways
📝 Shubh Loans raises $4.2 million from Saama Capital, others
📝 Marico expects premium brands biz to double in 3-4 years
📝 Liberty House plans to turn ABG Shipyard into steel plant.
Sunday, 26 August 2018
Risk in Financial services recollected on August 25 2018
Recollected qstn.
Rating migration case study- probability calculation of two variables (aa remain aa, then aa to default, calculate probability)
Duration calculation (semi annual, quarter,annual)
Cost of fund, mclr, crr calculation
Cumulative gap case study
Easy case study on Basel 3
Forex numerical case study
Geometric mean
Harmonic mean
Volatility
Var
bpv
case study on CRO
Rating migration case study- probability calculation of two variables (aa remain aa, then aa to default, calculate probability)
Duration calculation (semi annual, quarter,annual)
Cost of fund, mclr, crr calculation
Cumulative gap case study
Easy case study on Basel 3
Forex numerical case study
Geometric mean
Harmonic mean
Volatility
Var
bpv
case study on CRO
Mutual funds short notes 5
Chapter 7
• Overseas Corporate Bodies (OCBs) i.e. societies / trusts held, directly or
indirectly, to the extent of over 60% by NRIs, or trusts where more than
60% of the beneficial interests is held by such OCBs were not allowed to
invest until recently.
• SEBI and RBI circulars dated August 9, 2011 have allowed Qualified Foreign
Investors (QFIs) who meet KYC requirements to invest in equity and debt
schemes of Mutual Funds through two routes: Direct route (holding MF
units in a demat account through a SEBI registered depository participant)
and also through indirect route by holding units via Unit Confirmation
Recipt.
• Some gilt schemes have specific plans, which are open only for Provident
Funds, Superannuation and Gratuity Funds, Pension Funds, Religious and
Charitable Trusts and Private Trusts.
• In the case of Exchange Traded Funds, only authorized participants and
large investors can invest in the NFO. Subsequently, in the stock exchange,
anyone who is eligible to invest can buy Units of the ETF.
• Micro-SIP investment by individuals, minors and sole-proprietary firms are
exempted from the requirement of PAN card.
• The normal application form, with KIM attached, is designed for fresh
purchases i.e. instances where the investor does not have an investment
account (technically called “folio”) with the specific mutual fund.
• Both National Stock Exchange (NSE) and Bombay Stock Exchange (BSE)
have extended their trading platform to help the stock exchange brokers
become a channel for investors to transact in Mutual Fund Units. NSE’s
platform is called NEAT MFSS. BSE’s platform is BSE StAR Mutual Funds
Platform.
• The reduced NAV, after a dividend payout is called ex-Dividend NAV. After
a dividend is announced, and until it is paid out, it is referred to as cum-
Dividend NAV.
• PAN Card is not required for mutual fund investments below Rs 20,000,
where payment is in cash.
• Investors’ KYC details are stored in the server of KRA
Chapter 8
• Earnings per Share (EPS): Net profit after tax ÷ No. of equity shares
• Price to Earnings Ratio (P/E Ratio): Market Price ÷ EPS
• Book Value per Share: Net Worth ÷ No. of equity shares
• Price to Book Value: Market Price ÷ Book Value per Share
• It is generally agreed that longer term investment decisions are best
taken through a fundamental analysis approach, while technical
analysis comes in handy for shorter term speculative decisions,
including intra-day trading.
• Sector allocation is a key decision in a top down approach.
• The bottom-up approach is called as stock picking as stock selection
is the key decision in this approach.
• Top down approach minimizes the chance of being stuck with large
exposure to a poor sector. Bottom up approach ensures that a good
stock is picked, even if it belongs to a sector that is not so hot.
• Debt securities that are to mature within a year are called money
market securities.
• The difference between the yield on Gilt and the yield on a non-
Government Debt security is called its yield spread.
•The returns in a debt portfolio are largely driven by interest rates
and yield spreads.
• A mutual fund scheme cannot borrow more than 20% of its net
assets
• The borrowing cannot be for more than 6 months.
• The borrowing is permitted only to meet the cash flow needs of
investor servicing viz. dividend payments or re-purchase payments.
• SEBI has stipulated the 20:25 rule viz. every scheme should have at
least 20 investors; no investor should represent more than 25% of
net assets of a scheme.
• Dividend yield funds invest in shares whose prices fluctuate less, but
offer attractive returns in the form of dividend. Such funds offer
equity exposure with lower downside.
Chapter 9
• As a structured approach, the sequence of decision making is as
follows:
Step 1 – Deciding on the scheme category
Step 2 – Selecting a scheme within the category
Step 3 – Selecting the right option within the scheme
• Investing in equities with a horizon below 2 years can be dangerous.
Ideally, the investor should look at 3 years. With an investment horizon
of 5 years and above, the probability of losing money in equities is
negligible.
• An investor in an active fund is bearing a higher cost for the fund
management, and a higher risk. Therefore, the returns ought to be
higher i.e. the scheme should beat the benchmark, to make the
investor believe that choice of active scheme was right.
• The significant benefit that open-ended funds offer is liquidity viz. the
option of getting back the current value of the unit-holding from the
scheme.
• A close-ended scheme offers liquidity through a listing in a stock
exchange. Unfortunately, mutual fund units are not that actively
traded in the market.
• The price of units of a closed-end scheme in the stock exchange tends
towards the maturity of the scheme, the market price converges
towards the NAV.
• In a market correction, the Growth funds can decline much more than
value funds.
• Since floating rate debt securities tend to hold their values, even if
interest rates fluctuate, the NAV of floaters tend to be steady. When
the interest rate scenario is unclear, then floaters are a safer option.
Similarly, in rising interest rate environments, floaters can be
considered as an alternative to short term debt funds and liquid funds.
• Amongst index schemes, tracking error is a basis to select the better
scheme. Lower the tracking error, the better it is. Similarly, Gold ETFs
need to be selected based on how well they track gold prices.
Chapter 10
• Physical assets have value and can be touched, felt and used.
•Financial assets have value, but cannot be touched, felt or used as part of
their core value.
•A physical asset is completely gone, or loses substantial value, when stolen,
or if there is a fire, flood or such other hazard. It is for this reason that
some owners of physical assets insure them against such hazards.
•Investor’s money in land, art, rare coins or gold does not benefit the
economy. On the other hand, money invested in financial assets, e.g.
equity shares, debentures, bank deposits can be productive for the
economy.
• Gold futures contracts are traded in commodity exchanges like the National
Commodities Exchange (NCDEX) and Multi-Commodity Exchange (MCX).
The value of these contracts goes up or down in line with increases or
decreases in gold prices.
• Gold ETF on the other hand is an open-ended scheme with no fixed
maturity. It is very rare for an open-ended scheme to liquidate itself early.
Therefore, an investor who buys into a gold ETF can hold the position
indefinitely.
• Wealth Tax is applicable on gold holding (beyond the jewellery meant for
personal use). However, mutual fund schemes (gold linked or otherwise)
and gold deposit schemes are exempted from Wealth Tax.
• Real estate is an illiquid market. Investment in financial assets as well as
gold can be converted into money quickly and conveniently within a few
days at a transparent price. Since real estate is not a standardized product,
there is no transparent price – and deals can take a long time to execute.
• Tier I (Pension account), is non-withdrawable.
• Tier II (Savings account) is withdrawable to meet financial contingencies.
An active Tier I account is a pre-requisite for opening a Tier II account.
• Investors can invest through Points of Presence (POP). They can allocate
their investment between 3 kinds of portfolios:
o Asset Class E: Investment in predominantly equity market instruments
o Asset Class C: Investment in Debt securities other than Government
Securities
o Asset Class G: Investments in Government Securities.
Chapter 11
• The costs mentioned above, in today’s terms, need to be translated into the rupee
requirement in future. This is done using the formula A = P X (1 + i)n, where, A = Rupee
requirement in future, P = Cost in today’s terms, i = inflation & n = Number of years into
the future, when the expense will be incurred.
• The steps in creating a comprehensive financial plan, as proposed by the
Certified Financial Planner – Board of Standards (USA) are as follows:
a. Establish and Define the Client-Planner Relationship
b. Gather Client Data, Define Client Goals
c. Analyse and Evaluate Client’s Financial Status
d. Develop and Present Financial Planning Recommendations and / or
Options
e. Implement the Financial Planning Recommendations
f. Monitor the Financial Planning Recommendations
• During the Childhood stage, focus is on education in most cases. Children
are dependents, rather than earning members. Pocket money, cash gifts
and scholarships are potential sources of income during this phase. Parents
and seniors need to groom children to imbibe the virtues of savings,
balance and prudence. Values imbibed during this phase set the foundation
of their life in future.
• Equity SIPs and Whole-life insurance plans are great ways to force the
young unmarried into the habit of regular savings, rather than lavish the
money away.
• Young Married,where both spouses have decent jobs, life can be financially
comfortable. They can plan where to stay in / buy a house, based on job
imperatives, life style aspirations and personal comfort. Insurance is
required, but not so critical. Where only one spouse is working, life
insurance to provide for contingencies associated with the earning spouse
are absolutely critical. In case the earning spouse is not so well placed,
ability to pay insurance premia can be an issue, competing with other basic
needs of food, clothing and shelter. In such cases, term insurance (where
premium is lower) possibilities have to be seriously explored and locked
into.
• Accumulation is the stage when the investor gets to build his wealth. It
covers the earning years of the investor i.e. the phases of the life cycle from
Young Unmarried to Pre-Retirement.
• Transition is a phase when financial goals are in the horizon. E.g. house to
be purchased, children’s higher education / marriage approaching etc.
Given the impending requirement of funds, investors tend to increase the
proportion of their portfolio in liquid assets viz. money in bank, liquid
schemes etc.
• During inter-generational transfer, the investor starts thinking about
orderly transfer of wealth to the next generation, in the event of death.
The financial planner can help the investor understand various inheritance
and tax issues, and help in preparing Will and validating various documents
and structures related to assets and liabilities of the investor.
• Reaping/Distribution is the stage when the investor needs regular money.
Hence, investors in this stage need to have higher allocation to income
generating assets. It is the parallel of retirement phase in the Life Cycle.
• Winning lotteries, unexpected inheritance of wealth, unusually high capital
gains earned – all these are occasions of sudden wealth, that need to be
celebrated. However, given the human nature of frittering away such
sudden wealth, the financial planner can channelize the wealth into
investments, for the long term benefit of the investor’s family.
• Overseas Corporate Bodies (OCBs) i.e. societies / trusts held, directly or
indirectly, to the extent of over 60% by NRIs, or trusts where more than
60% of the beneficial interests is held by such OCBs were not allowed to
invest until recently.
• SEBI and RBI circulars dated August 9, 2011 have allowed Qualified Foreign
Investors (QFIs) who meet KYC requirements to invest in equity and debt
schemes of Mutual Funds through two routes: Direct route (holding MF
units in a demat account through a SEBI registered depository participant)
and also through indirect route by holding units via Unit Confirmation
Recipt.
• Some gilt schemes have specific plans, which are open only for Provident
Funds, Superannuation and Gratuity Funds, Pension Funds, Religious and
Charitable Trusts and Private Trusts.
• In the case of Exchange Traded Funds, only authorized participants and
large investors can invest in the NFO. Subsequently, in the stock exchange,
anyone who is eligible to invest can buy Units of the ETF.
• Micro-SIP investment by individuals, minors and sole-proprietary firms are
exempted from the requirement of PAN card.
• The normal application form, with KIM attached, is designed for fresh
purchases i.e. instances where the investor does not have an investment
account (technically called “folio”) with the specific mutual fund.
• Both National Stock Exchange (NSE) and Bombay Stock Exchange (BSE)
have extended their trading platform to help the stock exchange brokers
become a channel for investors to transact in Mutual Fund Units. NSE’s
platform is called NEAT MFSS. BSE’s platform is BSE StAR Mutual Funds
Platform.
• The reduced NAV, after a dividend payout is called ex-Dividend NAV. After
a dividend is announced, and until it is paid out, it is referred to as cum-
Dividend NAV.
• PAN Card is not required for mutual fund investments below Rs 20,000,
where payment is in cash.
• Investors’ KYC details are stored in the server of KRA
Chapter 8
• Earnings per Share (EPS): Net profit after tax ÷ No. of equity shares
• Price to Earnings Ratio (P/E Ratio): Market Price ÷ EPS
• Book Value per Share: Net Worth ÷ No. of equity shares
• Price to Book Value: Market Price ÷ Book Value per Share
• It is generally agreed that longer term investment decisions are best
taken through a fundamental analysis approach, while technical
analysis comes in handy for shorter term speculative decisions,
including intra-day trading.
• Sector allocation is a key decision in a top down approach.
• The bottom-up approach is called as stock picking as stock selection
is the key decision in this approach.
• Top down approach minimizes the chance of being stuck with large
exposure to a poor sector. Bottom up approach ensures that a good
stock is picked, even if it belongs to a sector that is not so hot.
• Debt securities that are to mature within a year are called money
market securities.
• The difference between the yield on Gilt and the yield on a non-
Government Debt security is called its yield spread.
•The returns in a debt portfolio are largely driven by interest rates
and yield spreads.
• A mutual fund scheme cannot borrow more than 20% of its net
assets
• The borrowing cannot be for more than 6 months.
• The borrowing is permitted only to meet the cash flow needs of
investor servicing viz. dividend payments or re-purchase payments.
• SEBI has stipulated the 20:25 rule viz. every scheme should have at
least 20 investors; no investor should represent more than 25% of
net assets of a scheme.
• Dividend yield funds invest in shares whose prices fluctuate less, but
offer attractive returns in the form of dividend. Such funds offer
equity exposure with lower downside.
Chapter 9
• As a structured approach, the sequence of decision making is as
follows:
Step 1 – Deciding on the scheme category
Step 2 – Selecting a scheme within the category
Step 3 – Selecting the right option within the scheme
• Investing in equities with a horizon below 2 years can be dangerous.
Ideally, the investor should look at 3 years. With an investment horizon
of 5 years and above, the probability of losing money in equities is
negligible.
• An investor in an active fund is bearing a higher cost for the fund
management, and a higher risk. Therefore, the returns ought to be
higher i.e. the scheme should beat the benchmark, to make the
investor believe that choice of active scheme was right.
• The significant benefit that open-ended funds offer is liquidity viz. the
option of getting back the current value of the unit-holding from the
scheme.
• A close-ended scheme offers liquidity through a listing in a stock
exchange. Unfortunately, mutual fund units are not that actively
traded in the market.
• The price of units of a closed-end scheme in the stock exchange tends
towards the maturity of the scheme, the market price converges
towards the NAV.
• In a market correction, the Growth funds can decline much more than
value funds.
• Since floating rate debt securities tend to hold their values, even if
interest rates fluctuate, the NAV of floaters tend to be steady. When
the interest rate scenario is unclear, then floaters are a safer option.
Similarly, in rising interest rate environments, floaters can be
considered as an alternative to short term debt funds and liquid funds.
• Amongst index schemes, tracking error is a basis to select the better
scheme. Lower the tracking error, the better it is. Similarly, Gold ETFs
need to be selected based on how well they track gold prices.
Chapter 10
• Physical assets have value and can be touched, felt and used.
•Financial assets have value, but cannot be touched, felt or used as part of
their core value.
•A physical asset is completely gone, or loses substantial value, when stolen,
or if there is a fire, flood or such other hazard. It is for this reason that
some owners of physical assets insure them against such hazards.
•Investor’s money in land, art, rare coins or gold does not benefit the
economy. On the other hand, money invested in financial assets, e.g.
equity shares, debentures, bank deposits can be productive for the
economy.
• Gold futures contracts are traded in commodity exchanges like the National
Commodities Exchange (NCDEX) and Multi-Commodity Exchange (MCX).
The value of these contracts goes up or down in line with increases or
decreases in gold prices.
• Gold ETF on the other hand is an open-ended scheme with no fixed
maturity. It is very rare for an open-ended scheme to liquidate itself early.
Therefore, an investor who buys into a gold ETF can hold the position
indefinitely.
• Wealth Tax is applicable on gold holding (beyond the jewellery meant for
personal use). However, mutual fund schemes (gold linked or otherwise)
and gold deposit schemes are exempted from Wealth Tax.
• Real estate is an illiquid market. Investment in financial assets as well as
gold can be converted into money quickly and conveniently within a few
days at a transparent price. Since real estate is not a standardized product,
there is no transparent price – and deals can take a long time to execute.
• Tier I (Pension account), is non-withdrawable.
• Tier II (Savings account) is withdrawable to meet financial contingencies.
An active Tier I account is a pre-requisite for opening a Tier II account.
• Investors can invest through Points of Presence (POP). They can allocate
their investment between 3 kinds of portfolios:
o Asset Class E: Investment in predominantly equity market instruments
o Asset Class C: Investment in Debt securities other than Government
Securities
o Asset Class G: Investments in Government Securities.
Chapter 11
• The costs mentioned above, in today’s terms, need to be translated into the rupee
requirement in future. This is done using the formula A = P X (1 + i)n, where, A = Rupee
requirement in future, P = Cost in today’s terms, i = inflation & n = Number of years into
the future, when the expense will be incurred.
• The steps in creating a comprehensive financial plan, as proposed by the
Certified Financial Planner – Board of Standards (USA) are as follows:
a. Establish and Define the Client-Planner Relationship
b. Gather Client Data, Define Client Goals
c. Analyse and Evaluate Client’s Financial Status
d. Develop and Present Financial Planning Recommendations and / or
Options
e. Implement the Financial Planning Recommendations
f. Monitor the Financial Planning Recommendations
• During the Childhood stage, focus is on education in most cases. Children
are dependents, rather than earning members. Pocket money, cash gifts
and scholarships are potential sources of income during this phase. Parents
and seniors need to groom children to imbibe the virtues of savings,
balance and prudence. Values imbibed during this phase set the foundation
of their life in future.
• Equity SIPs and Whole-life insurance plans are great ways to force the
young unmarried into the habit of regular savings, rather than lavish the
money away.
• Young Married,where both spouses have decent jobs, life can be financially
comfortable. They can plan where to stay in / buy a house, based on job
imperatives, life style aspirations and personal comfort. Insurance is
required, but not so critical. Where only one spouse is working, life
insurance to provide for contingencies associated with the earning spouse
are absolutely critical. In case the earning spouse is not so well placed,
ability to pay insurance premia can be an issue, competing with other basic
needs of food, clothing and shelter. In such cases, term insurance (where
premium is lower) possibilities have to be seriously explored and locked
into.
• Accumulation is the stage when the investor gets to build his wealth. It
covers the earning years of the investor i.e. the phases of the life cycle from
Young Unmarried to Pre-Retirement.
• Transition is a phase when financial goals are in the horizon. E.g. house to
be purchased, children’s higher education / marriage approaching etc.
Given the impending requirement of funds, investors tend to increase the
proportion of their portfolio in liquid assets viz. money in bank, liquid
schemes etc.
• During inter-generational transfer, the investor starts thinking about
orderly transfer of wealth to the next generation, in the event of death.
The financial planner can help the investor understand various inheritance
and tax issues, and help in preparing Will and validating various documents
and structures related to assets and liabilities of the investor.
• Reaping/Distribution is the stage when the investor needs regular money.
Hence, investors in this stage need to have higher allocation to income
generating assets. It is the parallel of retirement phase in the Life Cycle.
• Winning lotteries, unexpected inheritance of wealth, unusually high capital
gains earned – all these are occasions of sudden wealth, that need to be
celebrated. However, given the human nature of frittering away such
sudden wealth, the financial planner can channelize the wealth into
investments, for the long term benefit of the investor’s family.
Current Affairs on August 26th 2018
Today's Headlines from www:
*Economic Times*
📝 Relief for passengers soon as Railways plans flexi-fare rejig
📝 Bankruptcy sword looms over 60 companies owing Rs 3.5L crore
📝 Indiabulls arm to raise Rs 2,000 crore via bond sale
📝 CLSA raises red flag on Colgate after group arm’s India investment
📝 Punjab National Bank gets top rank in digital transaction as per Finmin report
📝 BRS Group highest bidder for SevenHills hospital
📝 India is betting big on multi-country science projects
*Business Standard*
📝 Inspired by past, eye on future, Mercedes unveils Silver Arrow concept car
📝 Health start-up Cure.fit raises $120 million, unveils expansion plans
📝 Exxon Mobil looking to buy wind, solar power delivery in Texas
📝 Indian aluminium makers defy global trend, log 12% growth in April-July
📝 Alphabet's comeback plans in China go beyond Google Search
📝 Indra Nooyi to get Asia Game Changer award by global cultural organisation
📝 22 new AIIMS coming up to ease regional imbalance in healthcare: J P Nadda
*Financial Express*
📝 Jet Airways to relook into structure, costs at board meet
📝 Anil Ambani resigns as director of Reliance Naval and Engineering
📝 Soon, smartphones to predict flash floods, other natural disasters
📝 Facebook fixes bug that marked posts as spam and removed them
📝 Huawei to repair its water-damaged phones in Kerala for free
*Mint*
📝 Auto parts makers eye gains in the aftermarket
📝 Defence ministry clears Rs 46,000 cr purchase of military equipment
📝 Elon Musk drops plan to take Tesla private
📝 For $5.8 million, Bugatti’s new supercar will turn corners faster than ever
📝 Karnataka takes Ordinance route to reduce farmer debt.
*Economic Times*
📝 Relief for passengers soon as Railways plans flexi-fare rejig
📝 Bankruptcy sword looms over 60 companies owing Rs 3.5L crore
📝 Indiabulls arm to raise Rs 2,000 crore via bond sale
📝 CLSA raises red flag on Colgate after group arm’s India investment
📝 Punjab National Bank gets top rank in digital transaction as per Finmin report
📝 BRS Group highest bidder for SevenHills hospital
📝 India is betting big on multi-country science projects
*Business Standard*
📝 Inspired by past, eye on future, Mercedes unveils Silver Arrow concept car
📝 Health start-up Cure.fit raises $120 million, unveils expansion plans
📝 Exxon Mobil looking to buy wind, solar power delivery in Texas
📝 Indian aluminium makers defy global trend, log 12% growth in April-July
📝 Alphabet's comeback plans in China go beyond Google Search
📝 Indra Nooyi to get Asia Game Changer award by global cultural organisation
📝 22 new AIIMS coming up to ease regional imbalance in healthcare: J P Nadda
*Financial Express*
📝 Jet Airways to relook into structure, costs at board meet
📝 Anil Ambani resigns as director of Reliance Naval and Engineering
📝 Soon, smartphones to predict flash floods, other natural disasters
📝 Facebook fixes bug that marked posts as spam and removed them
📝 Huawei to repair its water-damaged phones in Kerala for free
*Mint*
📝 Auto parts makers eye gains in the aftermarket
📝 Defence ministry clears Rs 46,000 cr purchase of military equipment
📝 Elon Musk drops plan to take Tesla private
📝 For $5.8 million, Bugatti’s new supercar will turn corners faster than ever
📝 Karnataka takes Ordinance route to reduce farmer debt.
Saturday, 25 August 2018
Certified credit professionals Today 25.08.2018 exam Recollected
Certified credit professionals Today 25.08.2018 exam Recollected
1.computation related all type to working capital methods
2.ratio analysis
3. irr
4.LC
5.project finance
6.BEP
7. IRAC norms.
Read minutely as theory questions were tough. Read book thoroughly. Practice the calculation related questions
8.Case Study Questions (5Q ) were from Capital Budgeting Techniques,
9. Working capital Assessment techniques, 10.LOC
11.BG
12.Export Credit
13.CP
14. Ratios
15. Then individual questions (1 - 2Q) from Credit rating agencies,
16.CIC
17.CERSEAI
18.PSL
19.BEP
20.Types of borrowers,
21.DDA
22.ANBC
23.Omnibus LC, etc.
24. Numerical 5 questions each from followingLC Assessment with EOQ
25.MPBF
26. NPV
27. IRR
28.EPC
29.Preshipment
30.Dollar account.
31.case studies on CP
32.and 2 more theory based case studies
33.Payback method
34.Running account facility
35.Gold card scheme
CCP Questions
36..8 Marks Numericals from Turnover and 37..1st and 2nd method of lending.
38..5 Marks Numericals from NPV and IRR.
39..5 marks questions from BG (not Numericals)
40..10 marks Numericals from Balance Sheet.
41.One question based on:
Under Section 16 of the MSMED Act, delayed
payment to supplier units, attracts compound interest with monthly rests at three times of
the bank rate notified by the Reserve Bank.
42.One question was from which date minor will be liable towards firm after attending majority.. declaration date, attending majority date or after 6 month .. answer?
43.Numerical part -NPV , IRR ,COST BENEFIT , TIME VALUE OF MONEY , BREAK EVEN , LC LIMIT
CASE STUDIES- BANK GUARANTEE, EXPORT CREDIT , PRIORITY SECTOR , GOLD CARD SCHEME , DIAMOND DOLLAR ACCOUNT
MOSTLY QUESTIONS WERE FROM EXPORT CREDIT ABOUT 10 - 15 MARKS AND NUMERICAL ATLEAST 10 MARKS
1.computation related all type to working capital methods
2.ratio analysis
3. irr
4.LC
5.project finance
6.BEP
7. IRAC norms.
Read minutely as theory questions were tough. Read book thoroughly. Practice the calculation related questions
8.Case Study Questions (5Q ) were from Capital Budgeting Techniques,
9. Working capital Assessment techniques, 10.LOC
11.BG
12.Export Credit
13.CP
14. Ratios
15. Then individual questions (1 - 2Q) from Credit rating agencies,
16.CIC
17.CERSEAI
18.PSL
19.BEP
20.Types of borrowers,
21.DDA
22.ANBC
23.Omnibus LC, etc.
24. Numerical 5 questions each from followingLC Assessment with EOQ
25.MPBF
26. NPV
27. IRR
28.EPC
29.Preshipment
30.Dollar account.
31.case studies on CP
32.and 2 more theory based case studies
33.Payback method
34.Running account facility
35.Gold card scheme
CCP Questions
36..8 Marks Numericals from Turnover and 37..1st and 2nd method of lending.
38..5 Marks Numericals from NPV and IRR.
39..5 marks questions from BG (not Numericals)
40..10 marks Numericals from Balance Sheet.
41.One question based on:
Under Section 16 of the MSMED Act, delayed
payment to supplier units, attracts compound interest with monthly rests at three times of
the bank rate notified by the Reserve Bank.
42.One question was from which date minor will be liable towards firm after attending majority.. declaration date, attending majority date or after 6 month .. answer?
43.Numerical part -NPV , IRR ,COST BENEFIT , TIME VALUE OF MONEY , BREAK EVEN , LC LIMIT
CASE STUDIES- BANK GUARANTEE, EXPORT CREDIT , PRIORITY SECTOR , GOLD CARD SCHEME , DIAMOND DOLLAR ACCOUNT
MOSTLY QUESTIONS WERE FROM EXPORT CREDIT ABOUT 10 - 15 MARKS AND NUMERICAL ATLEAST 10 MARKS
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