IIBF & NISM Adda

Friday, 3 January 2020

Single link for recollected questions on July 2019 iibf exams

In today's microfinance exam questions from,

1. Chikola group

2. Rrb bank established in the year

3. Rbi act, rrb act,

4. Bank rakyat Indonesia

5. Malegam committee recommendation

6. Shg bank linkage program

7. Sewa bank

8. Break even analysis also named as

9. As 2 deals with

10. Examples of cash flow like travel expenses interest expenses

11. 2 numericals from break even anaysis

12.average case load formula

13. Question from relationship risk

12.

Recollected Questions 21.07.2019 IT security recollected on 21.07.2019

ROBO backup

Skimmer and shimmer

RFID and Barcode shortcomings

ISO 27001

After Jillani committee 1996

What IT act took place

Downstream liability

Routers

A/B testing

VoiP eavesdropping

User level controls

PCI DSS

HIPAA

Defence in Depth

Green servers

Blade servers

E -wastes

Scavenging

ATM jitter

Mobile banking

TCP IP

VLAN

Cyptography

Steganography

IDS DNS

CLOUD computing

Threats

Vulnerability

SQL Injection

Cyber terrorism

Viruses worms

Malware

Stuxnet

Fault tolerence

Business continuity and Disaster recovery

DTP

Many case studies were there - calculations of duration,MD,convexity, mclr related problem, cal of market, credit risk weighted assets,

CTP

Certified treasurey professional questions dated 14.7.19

Friends to be honest paper was easy compared with the one dated 27.4.19

The following are the questions given

Numerical related to

FRA

Commercial paper numericals around 6-7 and also individual questions related to cp and cd such has issuers and maximum limit and minim limit and

Questions related to various measures of options : delta , gamma,rho,

Numericals on bond prices

Numericals of auctions

Dutch auction

French auction

Novation definition

Liquidity related questions

Direct quote

Reinvestment risk

Futures

Qustions related to bond yield

Transfer pricing

ECB

Option coupon bond

Zero coupon bond

The questions were mostly numericals so pleae go through the reference book

All d best friends

ISB

information System Banker Recollected questions

CyAT

CAA

Digital Signature

BCP

Digital forensics

Normalisation

Internal audit

DBA responsibility

Telecommunications system audit

Power off switches

Cyber terbunal judge or magistrate

DS reissuance

Central depository of DS

Audit trail significance

Bottom up methodology

Audit plan

BCP

IDS

Virtual keyboard

IFMS full from

EFT

RBIA

Inherent risk

Insider threat

IS Audit policy

Information security officer role

DBA responsibility

Stress testing

BCNF

Critical applications

Poor architecture system

SDLC

Prototyping model

RTO application

IT Act 2000

Punishment for copyright as per IT Act

Controller of Certifying Authorities operates the National Repository of Digital Signatures (NRDC)

Function of modem, which is not an OOP Lang. C C++ Java C#, questns abt DRP, Trojan horse, sniffing, spoofing, availability, integrity, DBMS, preventive, corrective, detective controls, BCP

DDL DML DCL TCL commands, CA CCA-Digital certificates

Digital signature complete

Cyber apellate tribunal presiding officer

System testing

Compliance testing

Substantive testing

Telecom control

Db forms

Db commands

Risk based audit

It audit

Dba roles n resp

Prototyping model

Sdlc full

Interface testing

Rbeit ltd reg it subsidiary of rbi

Non repudiation

Bot stroke worms

Certified information System Banker

13.01.2019 3 PM Batch

Moderate Difficulty

Passing Mark 60

Each question carries 1 mark ( 100 questions )

Scored 55 marks

Recollected questions

DR centre location

Data warehouse

Audit charter/policy

Is audit 5 -10 questions

RAM and cache memory

Static RAM

Metadata

Which DB model used in CBS

Characteristics of a table

Many to Many relationship in DB

Simple ,self,outer join

Adaptive maintenance

Multiplexing

Packet switching

Full Duplex method

Bridge,router,switch,gateway

Diff between router and switch

Function of osi model layers 5 questions

Which protocol used in banking http,smtp,tcp/ip

Real time processing

Emergency response

Mirror site and reciprocal agreement

Trojan horse

E money

INFINET

CFMS

SFMS

Spoofing, piggybagging

Pervasive principle in GASSP

Classification of control

Boundary sub system

Audit trail

Attenuation

Types of noise (cross talk)

False positive and negative

Firewall

Intrusion detection systems and tuning

In what circumstances user ID and password will be given to user(emergency access)

Remote Access

OS tasks

Travelling virus procedure

Public and private key encryption

ISB Recollected Questions and Exam Tips june18::::

Function of modem, which is not an OOP Lang.

C C++ Java C#, questns abt DRP,

Trojan horse, sniffing, spoofing, availability, integrity, DBMS, preventive, corrective, detective controls, BCP

International trade finance today's recollected

Its all about Limits on various transaction, FEMA Schedule:I, II, III, LRS, JV/WOS, different FC A/c and their purpose. Reading Macmillan BOOK thoroughly is sufficient to clear the Exam.

[08/07, 07:28] Ara: Vostro account

[08/07, 07:28] Ara: ECB is a form of bank loan, suppliers credit, buyer credit

[08/07, 07:28] Ara: Standby letter of credit is under ucp600 or ucp600 ,isp

[08/07, 07:28] Ara: Bill of Ladding 2 questions, export bill crystallization, guarantee maximum period, exim Bank duties 2mark, Duration of bill realisation, PCFC value above export order, deemed exporter, if domestic price increases above export price...

[08/07, 07:28] Ara: Deemed export 2 ques

[08/07, 07:28] Ara: Bank guarantee under

[08/07, 07:28] Ara: Lrs scheme available to individuals upto USD 250000 not to corporate, partnership, huf, trust

[08/07, 07:28] Ara: Buyer credit linked to Libor/ mibor

[08/07, 07:28] Ara: Documents should be presented within 21 days from

[08/07, 07:30] Ara: If the maturity date is a holiday then it should be presented before the date or after holiday

[08/07, 07:38] Ara: Merchant trade should be completed within 9 months

[08/07, 07:41] Ara: What is clean payment

[08/07, 07:41] Ara: High sea sale

[08/07, 07:42] Ara: Trade blog 1 que

[08/07, 07:43] Ara: Normal transist period is from the port to destination port or from manufacturing to destination port

[08/07, 07:47] Ara: India export rice in exchange of petrol, Diesel this is theory of comparative advantage , heckscher ohlin theory, theory of absolute advantage

[08/07, 07:50] Ara: In trade within country which is common as international trade. Dap ,Daa LC

[08/07, 08:00] Ara: Factoring forfeiting 4 questions

[08/07, 08:06] Ara: Transfer LC

[08/07, 08:11] Ara: Foreign exchange governed by dgft RBI, exim bank,

[08/07, 08:14] Ara: Lc is given on Fob value

[08/07, 08:20] Ara: If ABC company is having bank guarantee with x bank and they are entering to contract with y to supply goods and if ABC company fails what bank will do a) pay to y on the value of entered or b) pay a guarantee amount

[08/07, 08:21] Ara: Pre shipment 360 days

[08/07, 08:21] Ara: Preshipment interest is given upto 180 days

[08/07, 08:27] Ara: Bank guarantee should not be issued more than 10 yrs

[08/07, 08:29] Ara: Status holder are classified from one to five star

[08/07, 08:29] Ara: Softex is used for software export

[08/07, 08:36] Ara: Advance remittance up to usd200000

[08/07, 08:39] Ara: ABC company is dealing with goods and banking with x � bank , it buys goods from y and for y company x bank willing to finance is it a) vendor finance b) channel finance

[08/07, 08:49] Ara: Three , four star export house

[08/07, 08:54] Ara: Export of goods freely upto RS 500000

[08/07, 08:57] Ara: Project contractors after completion of project abroad may import without an authorisation good including capital goods used in project provided they have been used for atleast 1 yrs

[08/07, 08:58] Ara: Duty exemption scheme

[08/07, 08:59] Ara: Duty drawback scheme

[08/07, 09:03] Ara: Arbitration

[08/07, 09:03] Ara: Speculation

[08/07, 09:05] Ara: If on Oct 3 transaction is settled on Oct 5 assuming Oct 3,4,5 is working day this is a) spot b) forward c ) future d) ready

International Trade Finance exam yesterday.

Bill of Ladding 2 questions, export bill crystallization, guarantee maximum period, exim Bank duties 2mark, Duration of bill realisation,PCFC value above export order, deemed exporter, if domestic price increases above export price... Some more questions which I recollected.

Thanks

Trade Finance Recollected Questions: Preshipment, Post shipment Finance, PCFC, Forfaiting, EXIM Bank, FTP, Trade Blocs, ECGC Confirmation, DEPB Scheme, EPCG, Limitation Clause, ECNOS full form, Combined Transport Document, Gift Exports limit, Adv payment limit on Import, Bonafide Baggage period, Drawback, Merchanting TradeTrade, Domestic Trade types.

digital banking recollected

Jackpotting

Emv and non emv

Abps and aeps

Financial exclusion concept

10 questions on cards

Frauds like skimming etc

Risk based 5 questions

Mpin based 3 questions

Card dimension

8 straight forward questions from book

Confusing ones as all questions have 2 anwers type...be carefull before marking answers

Digital banking todays recollected questions

Otp full from

Pharming attack on internet website's

Mom and pop means

Technology solution in India which is not part of FI

Cyber mugging

X2x service code

Pos terminals related questions

Dimensions of plastic card

Difference between gprs pos and pstn pos

First pos mc developer in india

Chargeback related questions

Jackpotting in atm means

Meltdown and spectre means

Nfs managed by npci situated at

In Forex settlement the rupee leg is settled through

If I recollect I will append pls

Ccp-

Questions were conceptual. Really difficult questions from LG and LC. Questions from Syndication and MBA -5. LC - no numericals only conceptual case study 5 no. Syndication and Consortium -5 . EPS -5, IBC -5 , and questions covering the whole book. Interesting fact - none of this answer was the right answer nearly 15 -20 questions. Very confusioning

· Cleared CCP today.. Questions were from msme service n manufacturing sector, Npv and irr difference, eps calculation, calculation of tnw-1, minor question-2,case study on huf , bcsbi -2 questions, case study on lc and asked to select type of lc, max period of BG, deferred payment guarantee, cersai is done under, cersai is used for, break even point calculation-1,standard deviation on investment,time value for money etc...

· Forex operations review and Recollected exam

· Usance Period

· sanction of fresh/enhanced export credit limits should be made within 45

· Limit for export under OPGSP

· Schedule III of FEMA

· Remittance exceeding USD10Mio per project consultancy service in respect of Infra Projects

· commission to an agents abroad for sale of residential flats-USD25000 or 5% of inward remittance

· reimbursement of pre-incorporation expenses

· Donation - 1% or USD 5Mio

· Pan mandatory for all LRS remittance

· LRS reporting - Daily Basis

· LRS not applicable to HUF,Partnership form, Trust

· 2 new Incoterms incorporated in 2010

· export realisation period

· collectin bill

· rate application from transfer from NRE to FCNR

· who issue SOFTEX form

· fedai last meetings

· advance remittances toward imports of services are permitter without any limit

· question on accruals in the account should be converted into rupees into rupee on last day of succeeding

· month

· who can open SNRR account

· How much INR can be taken outside Inida

· Export of gift articles not exceeding 5 lacs

· NRO account Foreign nationals should not exceed more than 6 months

· Vostro account is funded through which Form1/2/3/4

· when we sent MT707

· Travellers proceedings to which countries not exceeding USD 300 per visit

· Target of FTP2015-20 export target of $900 billion by 2019-20

· Article 13 of UCP 600

· Green clause credit

· Commercial invoice should be signed and dated

· 10-12 questions on ECB,FDI,ODI

· 3-4 questions on FTP

· Questions asked from UCP 600, LOC, LRS, FTP 2015- 2020, ECGC, PTA, ECB, etc.

· Cleard Foreign Exchange Operations Exam today..paper was little bit tricky..no numericals, no case studies..just theoretical but concept based questions..ECB,FTP,LC,LRS,ECGC,EXIM, pre & post shipment are the some areas which covers more than half of the question paper.

· forex operation question 27.10.2018

· fro nre to fcnr which rate apply

· as per latest what is mandatory for lrs "pan"

· how much invest in jv - 400%

· coprporate donate what amount - 1% of forex earning or $5 m which ever is less

· one from high seas sale

· marine insurance policy indemnity se related

· fedai rate declare which rate in month end

· one is ralated to var and fbil

· if forward is more than spot then what - interest on base less than counter

· regarding lou and loc - ans is both are dicontinued

· one is if there is no loc and lou then what is the option for importer

· one forfaiting

· what is requirement to be an exporter

· if account is standard then in which case there is no need to report ecgc before disbursement

· ek bpo se related

· one is from eefc

· one is for tt buying

· ftp target for 2020

· advane under import of services without guarntee - $ 5 lakh

· condition for granting loan against nri deposit

· lc amendment- mt707

· one from urbdg 758

· urr 722

· one from demand guarantee

· standby lc

· one is lc term prevail against sanction ye ans h question i forget

· if lc not require transport , invoice then what - option given not remember

· incoter added in 2010 - dap dat

· one is if in lc there is no presentation date only expiry given then what will be presentation date

· for what we can not issue lc

· if lc is in fob then import licence what we endorse option - cif exw fob

· who issue softex forms

· one is edi port - sdf

· if some mistake in shippong bill then what will appraising officer do - mark and point to commisioner

· ~forex operation question 27.10.2018

· fro nre to fcnr which rate apply

· as per latest what is mandatory for lrs "pan"

· how much invest in jv - 400%

· coprporate donate what amount - 1% of forex earning or $5 m which ever is less

· one from high seas sale

· marine insurance policy indemnity se related

· fedai rate declare which rate in month end

· one is ralated to var and fbil

· if forward is more than spot then what - interest on base less than counter

· regarding lou and loc - ans is both are dicontinued

· one is if there is no loc and lou then what is the option for importer

· one forfaiting

· what is requirement to be an exporter

· if account is standard then in which case there is no need to report ecgc before disbursement

· ek bpo se related

· one is from eefc

· one is for tt buying

· ftp target for 2020

· advane under import of services without guarntee - $ 5 lakh

· condition for granting loan against nri deposit

· lc amendment- mt707

· one from urbdg 758

· urr 722

· one from demand guarantee

· standby lc

· one is lc term prevail against sanction ye ans h question i forget

· if lc not require transport , invoice then what - option given not remember

· incoter added in 2010 - dap dat

· one is if in lc there is no presentation date only expiry given then what will be presentation date

· for what we can not issue lc

· if lc is in fob then import licence what we endorse option - cif exw fob

· who issue softex forms

· one is edi port - sdf

· if some mistake in shippong bill then what will appraising officer do - mark and point to commisioner

· Foreign Exchange Operations Recollected question (27/10/18)-

· 1. LRS scheme availble to?

· 2. question abt Gift/donation.

· 3. one abt medical treatment?

· 4. PAN mandatory in LRS?

· 5. travellers limit 3000USD per visit or per annum?

· 6. foreign currency not permissible to- Nepal

· 7. forward contract limit- USD 1 million

· 8. question on RFC ac.

· 9. direct question on PIO.

· 10. whi can open SNRR ac

· 11. question abt prohibited investment.

· 12. what is green clause lc.

· 13. question on tolerance limit in Lc.

· 14. question abt advising bank.

· 15. question abt MT707.

· 16. 3-4 question abt bill of lading.

· 17. 2 new INCOTERMS.

· 18. SOFTEX form.

· 19. export to warehouse question.

· 20. 5-7 indirect question abt pre and post shipment.

· 21. question on forfaiting.

· 22. question on bill of entry.

· 23. 2-3 question on trade credit.

· 24. 1 question abt nature of transaction and rate applied.

· 25. 1 abt ECIB(WTPC)

· 26. 1 question on standby credit.

· 27. LRS statement submission.

· 28. normal transit period

· 29. ECB cost ceiling.

Wednesday, 1 January 2020

Cyber crime and fraud management recollected on 28.12.2019

Cyber crime and fraud management recollected on 28.12.2019

Recollected questions:
Cyber crimes are handled by which orgnanisation in india
Type 1 crime
Preventive control
Detective control
Detterant control
Logical control
Sections and their fine with imprisonment in years
Committes of it security ,it governance, it controls
Netra by which organisation
Fast flux
Stux net
Phising
Shoulder surfing
Digital signature
Oldest agency in india
Few questions on cert in
Passive attack
Active attack
Direct attack
In direct attack
Logic bomb
Zeus
India own operating system boss in under whom
Confidentiality
Availability
Integrity
Conventional crime
Cyber crime
Same features of conv and cyber crime
Tailgating
imp topics are 1differences between viruses and worm
2 it act
3 different types of cyber crimes
4 various types of cards
5 gate way payment
6 prevention and detection control
7 pss act
8 2 tier authentication
9 passive and active attacks
mostly questions from 2 and 3 and 4...units

Cyber terrorism
1. Who Coordinates with Interpol in India ? - CBI
2. Which department was designated as Nodal Agency for Cyber Crime prevention - CERT-IN
3. What is the difference between Virus and Worm - Virus need human intervention to activate or multiply whereas worm automatically get multiplied
4. Worms are mainly used by hackers to - Occupy more space in the system/heavy usage of bandwidth in the network
5. One of the employee carefully watching the password entered by the Manager. What type of threat it is - Shoulder Surfing
6. Leaving a Logged in Computer by an employee - is human negligence
7. Hackers scans the computer pre attack to identify - Vulnerability in the system
8. Hackers inject worms/virus into the network to reach the target system and it - exploits the Vulnerability
9. Non updation of antivirus is - one of the major vunerability
10. One customer recieved a call in his mobile phone and the person posing himself as a bank manager collected the card credentials from him.This type is called - Phising
11. Online Banking sites are borne to what risk - Phising/IP spoofing
12. Data transfer between systems vide Network can be secured by - PKI
13. Customers can make sure that they deal with the authenticated website - by checking the Lock icon near the address bar
14.In https, S denotes - Secured/Security
15.This kind of worms directly attacks the root directory - Rootkits
16. This worms are really hard to detuct and delete - Rootkits
17. The compromised systems in the network are commonly termes as - Zombies
18. Customer security credentials were compromised by way of fraudulent SMS is called - smishing
19. The employees who try to hack their own company's site/find the vulnerabilities are called - White hat hackers
20.DDos - Distributed Denial of Service
21.Ransomware which blocks the access to the website demanding ransom for the same is - Denial of Service attack
22. Using same method for both encryption and decryption is called - symmetric encryption
23. Providing Last Login detail in Internet banking site is to - to detect any unauthorised usage earlier
24.Limits for retrying the passwords is - to avoid the unauthorised access
25. To safeguard from the Key Loggers attack - Use Virtual Key board to enter passwords
26.UTM stands for - Unified Threat Management
27.Setting up smoke detectors in the branch is - Detective Method
28.Placing Security guard in system room to avoid - Physical damage/attack on systems
29. Following the authorised person to enter into system room and making entry into the room is - Tailgatting
30.Dumbster Driving is a method - Searching for vulnerability in deleted files and data
31.FIrewall is - Intrusion Detection System
32.Authentication of electronic data/document can be assertained by - Digital Signature
33. When two or more persons illegally tries to enter into a critical room with single id/same id - Masquerading
34.Detection is normally - Post incedent
35. Post incident study mainly for the purpose of - study the impact of the attack and lessons for future prevention
36. Indian Agency working on Digital Forensics and Cyber security - C-DAC
37. OLTP refers to - On line Transaction Processing
38. OLTP is also termed as - Payment Gateway
39. Payment Gateway the Acquiring Bank to - Issuing bank through the Card Scheme to complete the transaction
40.Security Concerns arise in Payment Gateways are - At the User Level, Bank level and Merchant POS
41. Credit Card data theft through POS is falls under - Merchant PoS Security
42.Data encrypted using Private key can be decrypted by the public key available with - the Receiver
43. Cross verifying the Signature on the Slip against the Signature in the back side of the ATM card is doen by - the Merchant
44.Data should be secured in the following stages - Saved, Transit and Retrival
45.Intruder software in a network which attacks the data while in trnasit and thus commits data theft - Man in the Middle Attack
46. Captures a widows sessio for the purpose of data theft before it reaches the recipient is - Session Hijacking
47. Limits set for retrying of password is to avoid - Brute Force attack
48. ISSP stands for - Information System Security Policy
49.ICANN stands for - International Corporation for Assigned Names and Numbers
50.TLD stands for - Top Level Domain
51.Globally recognized set of rules defined for electronic records is - e-UCP
52.Technique used to redirect traffic from the infected device is called - Sinkholding
53. The technique which can intercept unencrypted data transit of mobile apps is called - Wi FI Snifing
54. This is one type of malware which doesnot affect the system/network - Ad-ware
55. This usually comes as a Pop up/add on screen which carries link for dubious websites - Ad-ware
56.EMV cards follow standard of - ISO/IEC No 7816
57. EMV cards follow this standard for Contactless card - ISO/IEC 14443
58. NFC is the technique used in contactless cards - Near Field Communication
59.PCI - DSS stands for - Plastic Card Industries - Data Security Standards
60. NFC cards works under - RFID Technology
61. Providing Access controls to employess based on roles/need is - Risk based Authentication
62. Seeking PIN to complete a transaction in PoS is - 2FA
63.SSL - Secure Socket Layering
64.SSL ensures - Encrypted link between a web server and a browser
65. Sending annoying messages to a person causing irritation/nuisance - Cyber Stalking
66. Black mailing a person using Computer/or network is - Cyber Extortion
67. Ransomware is type of - Cyber Extortion
68. Disputes on Domain names and protest are redressed globally by - UDRP
69. Phising/Vishing is type of - Cyber Cheating
70. Group of people attacks a Computer/ group of computers for propagating a objective - Cyber Terrorists
71. Hackers with common interest attack rival government's department site and database are - Cyber terrorists
72. ____ refers to the quality of secrecy associated with the data and the state of keeping an information asset secret - Confidentiality
73.____ refers to the state of remaining in the same format and not allowing for any tampering/manipulation - Integrity
74. ____ refers to the state o confirmation that the user has the authority to issue the command to the system - Authorisation
75. Quality of non denial, the stake holders are not permitted to denythe particular act of doing the act is - Non-repudiation
76. CAPTCHA refers to - Completely Automated Public Turing test to Tell Computers and Humans Apart
77. Placing letters in different sizes and styles which is hard to read by systems/robots is called - CAPTCHA
78. _______ is an important component for study and analysis to under the modus operandi of a Cyber Attack - Threat Vector
79. In cyber Crime, Threat landscape is denoted as - Study of entire overview of the network which was attacked
80. Conventional Crimes are - Physical crimes that involve thet of systems and hardware devices
81.Cyber Crimes are - System Crimes that involves data theft or tampering
82.Insider Attack Threat is - attack on the system/network by own employee without any permission/authentication
83.______ is the most dangerous attack in cyber crimes - Insider Attack
84. An employee copied and sold the sensitive information to a competitor concern is an example of - Insider Attack
85. Hackers scan the port/system and develop worm or codes to attack the same based on this - Vulnerability
86. ____ doesnot wait for any executable file to run for getting activated in the target system - Worm
87.____ refers to small piece of programs injected into the target system to spy on the activities - Spyware
88. Drones are classified as - Spying Devices
89. UAV stands for - Unmanned Aerial Vehicle
90. Most of the UAV used by the polic/defence authorities for - Survelliance purposes
91.The persons who are hired by companies to hack their own website/to identify the Vulnerability are - Blue Hat Hackers
92. System of effectively taking care of URL filterig, web-filtering, anti-virus, as all in one solution is referred as - Unified Threat Management
93. Force Log out option in Internet banking after certain time of Idleness is to guard the system against - Session Hijacking
94. Installing anti virus into the system is - Preventive Method
95.A statement used to create, alter, drop objects in a database is called - Data Definition Language
96. Fault Detection, isolation nad recovery are closely associated wiht - Detection Control
97. Installing Bio Metric devices to check unauthorised entry is - Physical Control
98. Unless properly logged, straightaway accessing the database through a SQL is termed as - Back end Access
99.IT Act 2008 describes the activity of hacking as a criminal activity in section no 66
100. IT Act 2000 came in force on - 17 October 2000
101. IT Amendment Act came into force on - 27 October 2009
101. IT Act consists of - 13 Chapters and 90 Sections
102. The Section which deals with cyber crimes as civil offence - Section 43
103. The Section deals with cyber crimes as Criminal Offences - Section 66
104. IT Amendment Act included the following which is not in the IT Act 2000 - Electronic Signature
105. Electronic Signature has been dealt in - Section 15
106. Under Section 43A, if any body corporate handling any sensitive personal data is negligent in implementing and maintaining reasonable security the compensation may go upto - five crore rupees
107. Under Section 43, if one found guilty on Data theft/alters/destroys the same the penalty/compensation may go upto - One Crore rupees
108. Tampering with Computer Source Documents - Section 65
109. Punishment under Section 65 may go upto - Three years imprisonment and extend upto Two Lakhs Fine
110. Computer Related offences which were dealt under section 43 can also be dealt as criminal offence under section - 66
111. Punishment under Section 66 may go upto - two three years and/or fine upto five lakhs rupees
112. Crime of Cyber Stalking ( sending electronic messages for the purpose of causing annoyance/inconvenience/decieve/mislead the recipient) may lead to - two three years imprisonment
113. Identity Theft is dealt under Section - 66c
114. Punishment of Identity Theft - may extend to three years term and/or fine upto One lakhs rupees
115. Puishment for Cyber Cheating - may extend to three years term and/or fine upto One lakhs rupees
116. Cyber Cheating is dealt under - Section 66D
117. Punishment for Cyber Terrorism may extend upto - Life time Imprisonment
118. Cyber Terrorism is dealt under - Section 66F
119. Publishing obscene material in electronic form dealt under - Section 67
120. Punishment under Section 67 may extend upto - two three years term and/or five lakhs fine
121. Punishment for Sudsequent conviction of the same crime under section 67 is - 5 years term and/or ten lakhs rupees fine
122. Sexually explicit content in electronic form dealt under - Section 67A
123. Punishment under Section 67A is - Five years term with fine
124.Punishment for Sudsequent conviction of the same crime under section 67A is - 7 years term and/or ten lakhs rupees fine
125. CERT-IN has been designated as Nodal agency for Critical Information Infrastructure Protection under Section - 70B
126. Mispresentation/Suppression of material Fact dealt under - Section 71
127. Penalty under Section 71 - Two years term and/or fine upto One lakh rupees
128. Breach of confidentiality and Privacy dealt under Section - 72
129. Analysing the style of writing or the langauage style for the purpose of Crime Investigation is - Stylometry
130. RBI issues licenses for Payment Banks in India based on approval from - BPSS
131. NTRO stands for - National Technical Research Organisation
132. Netra, the light weight UAV was developed by - DRDO
133.NCIIPC stands for - National Critical Information Infrastructure Protection Centre
134. DSCI - Data Security Council of India
135. Digital Forensic tools used by our Police Department were developed by - C-DAC
136. C-DAC stands for - Centre for Development of ADvanced Computig
137. NTRO works under - Prime Minister's Office
138. Two acts which are mainly handled by ED - FEMA and PMLA
139. Money laundering using banking systems/Internet banking is - Conventional Crime
140. Obtaining an IP address similar to some other and demanding a ransom for forego the same is - Cyber Squatting
141. Data Protection while in transit using non repudiation techniques can be achieved through - Public Key Infrastructure
142. Card Skimming is a technique mostly used th steal the card details and it mostly placed on - ATM manchines
143. Card Skimming Data Theft can be avoided using - Contactless Cards/NFC Cards
144. To avoid the Card Credentials in Online sites these cards were introduced - Virtual Cards
145. Smart Cards which are loaded with Money prior to issue is called - Prepaid Cards
146. Virtual Cards normally comes with a validity of - 24 hours to 48 hours
147. Maximum loading permitted in a Prepaid as per RBI instruction is - 50000/-
148. Hackers try to capture the login credentials by analysing the keys pressed in the Key boards. the worms captures such data is called as - Key Loggers
149. By clicking unauthenticated link, customers may diverted to fake websites to capture the sensitive personal. This is type of - Website spoofing/IP Spoofing
150. Ad wares are used not to harm the computers but to - make a catch by making the user to click on the dubious link to fake websites

Monday, 30 December 2019

Types of endorsement

Types of Endorsements:-

1) Blank Endorsements: section 16(1) it means endorser only signs his name with adding any words or directions this endorsement makes the instrument payable to bearer.

2) Endorsement in Full: - The endorser added the name of endorsee specifically.

3) Conditional Endorsement: Here the endorser puts some conditions for endorsee Here the binding of conditions is between endorsee and endorser only.

4) San recourse Endorsement: - Endorser added the words without recourse to me.

5) Facultative Endorsement: - Where an endorser waives the condition of notice of dishonour.

6) Endorsement on Bearer Cheque: - The endorsement on bearer cheque is meaning less as the cheque once bearer is always bear.

Crossing:-

General Crossing (Sec.123): Two parallel transverse lines on the face of instruments with or without word ‘Not negotiable’. It is direction to the paying bank that do not pay the cheque across the counter.

Special Crossing (Sec.124): In addition of general crossing the cheque bears the name of collecting bank either with or without the words ‘Not negotiable’.

Collection of cheques:-

Section 131: a banker who has in good faith and without negligence received payment for a customer of a cheque (not available for B/E and P/N) crossed generally or specially. The present section gives protection provided following conditions are fulfilled…

a) The bank must have acted in good faith and without negligence.

b) Bank has received the payment as an agent for collection.

c) Bank has collected the cheque in the duly introduced account of customer only.

d) The cheque collected must be crossed.

Payment of cheques:-

Liability of drawee (paying banker): It is obligation of the banker to honour the cheques of a customer provided there is sufficient balance and the cheque is otherwise in order. Section 31 of NI act provides that “The Drawee of a cheque:

a) Must have sufficient funds in the account.

b) Properly applicable to the payment of such cheque.

c) Must pay the cheque when duly required to do so.

d) In default of such payment, must compensate the drawer for any loss or damage.

Protection for paying banker in case of cheque:-

Regularity of endorsement Section 85(1): Paying banker’s liability is to ensure the regularity of the endorsement and is not concerned with genuineness of endorsement. The genuineness of endorsement is the liability of collecting banker. Therefore, protection is available to the paying banker in case of forged endorsements.

Payment in due course (Section-10):-

a) In accordance with the apparent tenor of the instrument.

b) In good faith and without negligence.

c) To the person in possession of the instrument.

d) Under the circumstances which do not afford a reasonable ground for believing that he is not entitled to receive the payment of the amount mentioned therein.

When bank should not pay:-

a) The death of the drawer in case of individual’s account terminates the contractual relationship.

b) Insane customers: in case of insanity.

c) Insolvent drawers: The bank should stop the operation of such account as if drawer adjudged insolvent and balance in the account vested with official receiver/assignee.

d) Countermanded by drawer: on receipt of valid stop payment instruction by the drawer.

e) Others: when a cheque is post dated, with insufficient balance in the account, cheque is of doubtful legality, or cheque is irregular, ambiguous, materially altered or stale etc.

Dishonour of cheques (Sec. 138-147):-

The payee or holder in due course should give notice to drawer within 30 days of return of cheque with the reason “Insufficient balance” and demanding payment within 15 days of his receiving information of dishonour. Drawee can make payment within 15 days of the receipt of notice and only if he fails to do so prosecution could take place. The complaint is to be made with in one month of the cause of action arising that is expiry of the notice period.

Punishments:

a) Summary proceedings: fine up to Rs. 5000/- and imprisonment up to one year or both.

b) Regular proceedings: fine up to the double the amount of cheque or imprisonment up to 2 years or both.

Sunday, 29 December 2019

Green Banking

Green Banking
Green Banking is when a normal bank takes into consideration all the social and environmental factors
while carrying on its basic operation of lending and raising deposits. It is also called ethical banking.
Green banks are regulated by the same authorities as traditional banks and have to abide by
the same rules.
All banks play an intermediary role in the economy; because of this the possibility for banks
contributing to sustainable development is high.
Banks can adopt a ‘carrot-and-stick’ approach, where environmental and social front-runners
would pay less interest than the market price for borrowing capital, while environmental
laggards would pay a much higher interest rate.
Some areas in which green banking is being adopted by banks are:
i. Online Banking facility and mobile banking– helps in saving paper, energy and
expenditure of natural resources.
ii. Green checking accounts like ATMs, Self-Service Kiosks, special touch screens.
iii. Supporting environmental friendly residential projects by offering various concessions
both for the project and individuals who avail home loans.
iv. Using solar and wind energy by installing wind mills for captive use.
v. Installing solar powered ATMs.
vi. Going in for rain water harvesting in their premises.

Whatvis priority lending certificate

What is priority lending certificate?
The priority sector lending certificates are certificates issued by banks that have over reached their priority sector
lending targets. PSLCs thus can be issued only up to the extent of their over lending to the stipulated sectors. Buyers of
PSLCs are usually those banks who could not meet their priority sector lending targets. The price of PSLCs will be
determined on the basis of demand and supply that will be reflected in the auction under the RBI‟s e-Kuber training
platform.
As per RBI guidelines, Banks can issue four types of PSLCS including three subsector PSLCs – agriculture, small and
marginal farmers, micor enterprises and one PSLC for general.

RBI plans to set up a ‘college of supervision’ (BL 27.12.19)

RBI plans to set up a ‘college of supervision’ (BL 27.12.19)

To ensure that irregularities in the financial sector, which are increasingly becoming complex and interconnected, do not escape the attention of its inspectors, the Reserve Bank of India is planning to set up a ‘college of supervision’. “Skill imparting is not a one-time affair. They (inspectors) have to be re-skilled from time-to-time because things are evolving, things are changing, becoming more complex. So, more emphasis can be given on improvement of skills. “...And, therefore, for better training, we are creating a college of supervision. We are also creating within the Department of Supervision and Regulation, an internal research and analysis group,” said RBI Governor Shaktikanta Das, during an interaction. The proposed college will improve the skillset of inspectors so that when they assess risk in regulated entities such as banks, non-banking finance companies, urban co-operative banks and payment system providers, they are mindful of the lurking dangers. This move comes in the backdrop of the letter of undertaking scam at Punjab National Bank, the IL&FS group and DHFL defaulting on debt servicing, and Punjab and Maharashtra Co-operative Bank being brought to its knees due to a large irregular exposure to a real estate company. Post these developments, the RBI created a unified Department of Supervision and a unified Department of Regulation. Earlier, there were three separate supervision departments (one each for banking, non-banking and co-operative banks) and three separate regulation departments (one each for banking, banking and co-operative banks).

Saturday, 28 December 2019

Msme recollected questions on 28.12.2019

Msme recollected questions on 28.12.2019

Investment in P&M, Equipment, Partnership, public and private limited company, Joint Hindu Family, Partnership, women entrepreneurs categories, ITCOT, US small business act, KVIC, SIDC, BCSBI loan application disposal time norm, venture capital fund, smera, cgtmse, angel funds, hybrid capital, collateral free loan, pmegp, red and green clause LC, back to back LC, 5 Cs, credit appraisal, ratios analysis and balance sheet related questions, nayak and other methods of lending, risk types, PS targets, BDS, Tequp, RRTUFs, back ended subsidy, clusters, rehabilitation n restructuring, drt, arc, mudra, wto, clearancs for setting up unit, items included in P&M etc... reading of entire book and updated changes is must.

Certified Risk management recollected questions on 28.12.2019

Certified Risk management recollected questions on 28.12.2019

1. Calculate geometric mean, harmonic mean.
2. Question on probability related to card.
3. Calculation of duration, mod duration and convexity.
4. Problems on forex. Spot rate given , buy and sell problem
5. Theoretical questions were also many
6. Gap calculation regard to net interest income.
7. Risk weight assets given. Calculation of cet 1, tier 2 and at 1. Tier 1 along with ccb.
8. Calculation of vertical disallowance, horizontal disallowance and capital charge of market risk.

CTP recollected questions on 28.12.2019

Certified treasury professional exam 28.12.19
1)question on price yield curve like nature of curve,meaning of intersection of curve with price axis, etc 5 question
2)option question... Like in the money, at the money, out of money, time Valueof option, intrinsic, call put questions on option based on strike and spot price
3)forward rate agreement.. Numerical 5 marks as per mac mill an book with some changes
4)repo question numerical like forward leg ready leg numerical as per mc millian book
5)bond question npv of coupons and principal related questions 5 marks
6)commercial paper theory questions 5 marks like who can issue, whether cp gives coupon, net worth for issuing cp etc.. Read Mac millian book ,all questions answerable
7)question on forex tt rate bill rate based on nature of transactions which rate to be selected.. 5 questions
8)numecrical on yield calculations and prices calculations for t bills.. Numerical similar to what has been given in appendix at back of Macmillan book 5 question
9)theoretical question were also conceptual.. Question related to bond option derivative swap
Overall questions were medium level of toughness for those who have not worked in this area
These questions I can recollect
Best of luck to those who wish to appear for CTP exam.

Numerical based on FRA, CURRENCY EXCHANGE, REPO TRANSCATION, BOND/YTM, YIELDS ON T-BILL, CURRENT YIELD
A 5 MARKS EASY SET OF QUESTION FROM COMMERCIAL PAPER

Other Theory questions from Bond theorem, Delta, gama etc.
35-40 marks numerical is there.

PPF (Public Provident Fund) Scheme 2019 – 5 Important Changes

*PPF (Public Provident Fund) Scheme 2019 – 5 Important Changes*

Recently Government notified the PPF rules by withdrawing the earlier notifications. This notification is called as PPF (Public Provident Fund) Scheme 2019 which removed the earlier notifications with respect to Public Provided Scheme 1968.Let us see the major changes that happened in this new PPF (Public Provident Fund) Scheme 2019.

*PPF (Public Provident Fund) Scheme 2019 – 5 Important Changes*

*# Premature Closure is allowed for NRIs*
When in the year 2016, PPF premature rules were announced, the Government introduced certain eligibility to opt for premature closure of the account and they are as below. (Refer my old post “Premature closure of PPF account – New Rules 2016“)
Premature closure of the account is allowed in the event of the death of the account holder (This is the old rule and will continue).
Premature closure of account is allowed in the event of serious ailments of holder, spouse, parents or children.
Premature closure of the account is allowed in the event of the amount required for the higher education account holder or minor account holder.
However, with the new PPF (Public Provident Fund) Scheme 2019 rules, if the account holder turned NRI, then they are allowed to opt for premature closure. Refer the notification wordings “on change in residency status of the account holder on production of copy of Passport and visa or Income-tax return”. This facility of premature closure of account for NRIs will be available only after the completion of 5 years of period.
*# Interest Rate on the PPF Loan is reduced*
If you took a loan against your PPF Account, the PPF Scheme 1968 laid down an interest rate of 2% per annum above the prevailing PPF interest rate. For example, suppose the prevailing interest rate is 7.9%, then you used to pay the interest of 9.9% on your loan on PPF.This interest rate on PPF loan is reduced to 1% from the older 2%. Hence, if the prevailing interest rate is 7.9%, then the applicable interest rate on PPF loan is 8.9%. I think this is a big booster for many who can easily avail this rather than going for other forms of loans like a personal loan.In both cases, the interest is levied from the first day of the month in which the loan is taken to the last day of the month in which the last installment of the loan is paid.
*# No upper limit on the number of deposits in a Financial Year*
Earlier, the maximum number of deposits you are allowed to deposit in PPF is restricted to 12. The meaning of the year is FINANCIAL YEAR. In other words, you can make deposits to the PPF account as many times as you want, subject to the maximum limit.This gives a big booster and flexibility for many investors. Because if one has to fill Rs.1,50,000 a year, then his every contribution should be Rs.12,500 as he has to fill the maximum limit within 12 installments. With this change, PPF turned more flexible.
*# Deposit in the multiple of Rs.50*
Earlier the minimum deposit in a year was Rs.500 and thereafter in the multiple of Rs.5. This now increased to Rs.50. This change is required as there is no value for Rs.5. Hence, I think it is a good move.
*# Change in the Forms*
To streamline the process, the PPF(Public Provident Fund) Scheme 2019 rules changed the complete form structures and the new forms are as below.
Account Opening Form-Form 1 (Earlier it was Form A)
Contribution Form-Earlier it was Form B. However, nothing is specified under the new scheme.
Partial withdrawals- Form 2 (Earlier it was Form C)
Account closure after maturity: Form 3 (Earlier it was Form C)
PPF Loan- Form 2 (Earlier it was Form D)
Extension Form- Form 4 (Earlier it was Form H)
Premature Closure: Form 5 (This was not specified earlier)
Nomination-Form 1 (Earlier it was Form E)

Friday, 27 December 2019

Terminologies in forex

TERMINOLOGIES IN FOREIGN EXCHANGE MARKET

Cash date or
Trade date

The date of the transaction, say
“today”
If today is 04-02-2019, then Cash
date is 04-02-2019

Tom date Tom is short for “tomorrow” and is
the next working day from the Cash
date
If today is 04-02-2019, then Tom
date is 05-02-2019

Spot date Second working day from the Cash
date, or day after tomorrow
If today is 04-02-2019, then spot
date 06-02-2019
Spot Rate The rate quoted and transacted
today for settlement (debit/ credit) on
the Spot date
All the forex transactions get
settled on spot by default unless
specified as cash or tom.
Cash Rate The rate applicable for settlement
(debit/ credit) today itself, on the
Cash date
This is usually lower than the Spot
Rate. The difference between the
two rates is known as the Cash-
Spot rate or Cash-Spot difference.
Tom Rate The rate quoted and transacted
today for settlement (debit/ credit)
tomorrow, on the Tom date
This is lower than the Spot Rate,
but higher than the Cash Rate

OTC
(Over
the counter)
A decentralized market, without a
central physical location, where
market participants trade with one
another through various
communication modes such as the
telephone, email and proprietary
electronic trading systems.
OTC markets are primarily used to
trade bonds, currencies,
derivatives and structured
products.

Bid rate Buying rate USD/INR = 71.67/69, 71.67
buying rate

Ask rate
/Offer rate
Selling rate USD/INR = 71.67/69, 71.69 is
selling rate
Spread The difference between the bid rate
and the ask rate
USD/INR = 65.01/03,
Spread is 0.02 paise

1. Nostro account It refers to an account that a bank holds in a foreign currency with
another bank. This account is used to facilitate foreign exchange
and trade transactions. E.g SBI, FD, maintaining an account with
SBI, New York or Citi Bank New York.
2. Vostro account It is an account a correspondent bank holds on behalf of another
bank. These accounts are an essential aspect of correspondent
banking in which bank holding the funds acts a custodian for or
manages the account of a foreign counterpart
3. Derivatives It is a financial instrument whose value is derived from the value of
another asset, which is known as the underlying.
When the price of the underlying changes, the value of the
derivative also changes.
This underlying can be an asset, index or interest rate
4. Uses of derivatives It can be used for a number of purposes, including insuring against
price movements, increasing exposure to price movements for
speculation or getting access to otherwise hard to trade assets or
markets.
Examples of derivatives: Forwards, Futures, Options, Swaps
5. Forward contract It is a customized contract between two parties to buy or sell an
asset at a specified price on a future date.
Forward contract can be customized to any amount and any
delivery date or delivery period, which is provided at the initiation of
a forward contract. (Such option period of delivery shall not extend
beyond one month).
In such an arrangement, the risk of loss which might accrue
because adverse movement in the rate of exchange is sought to be
removed. It helps the exporter to crystallize the amount realizable in
terms of his own currency. Similarly, the importer is also able to
determine the cost of imports in terms of his own currency.
Similarly, it renders debtors and creditors free from the risk arising
through fluctuations in the exchange rate
6. Futures It is a standardized forward contract, a legal agreement to buy or
sell something at a predetermined price at a specified time in the
future, between parties not known to each other
7. Options It is an agreement between a buyer and seller that gives the
purchaser of the option the right to buy or sell a particular asset at a
pre-determined price on a specified date or period.
The advantage of buying an option is the opportunity of the
unlimited profit. And the opportunity loss is limited to the premium
paid.

Strike price The strike price is the price at
which a buyer of a call option can
buy the security (Foreign
currency) while for put options it is
the price at which the security
(Foreign currency) can be sold
(Put option). The strike price is
fixed in the contract and does not
fluctuate with any change in the
underlying security.
Strike price is also known as exercise
price. Option holder is the buyer of call
option/put option. Option holder has the
right but not the obligation.
Option style
An option contract can be either
American style or European style
American style options can be
exercised any time before
expiration while European style
options can only be exercise on
expiration date itself
American style option
Delivery period e.g.
1 Mar till 31 Mar, 18 Feb to 17 Mar, etc.
European Style (Fixed date)
1 Jan, 15 Feb, 23 Mar etc
Underlying
asset
The underlying asset is
the financial instrument (such as
stock, futures, a commodity, a
currency or an index) on which
a derivative's price is based
Premium In exchange for the rights
conferred by the option, the option
buyer must pay the option seller
(usually a bank) a premium for
carrying on the risk that comes
with the obligation. The option
premium depends on the strike
price, volatility, as well as the time
remaining to expiration. (In simple
terms, amount paid for buying the
option)
This can be related to an insurance
premium where the buyer of the option
must pay for having the right but not the
obligation.
Buy Call Buying a call option gives the right
to the buyer and not the obligation
to buy the currency at the strike
price.
Call option Strike Price
USDINR=72.00
Market Scenario (Spot price) on due date
USD/INR=71
USD/INR=72
USD/INR=73
@71, buyer will not exercise the call
option and will go to the forex market to
buy dollars at spot price at $ 71 which is
less than strike price of $72. (option is not

exercised)
@73, buyer will exercise the option to buy
the dollars from bank at 72(strike priceoption
exercised)
@ 72, no impact (the holder may not
exercise option, the maximum loss is the
premium paid for buying the call option)
Buy Put Buying a put option gives the right
to the buyer and not the obligation
to sell the currency at the strike
price.
Put option Strike Price
USDINR=72.00
Market Scenario (Spot price) on due date
USDINR=71
USDINR=72
USDINR=73
@71, buyer will exercise the put option
and will sell dollars at strike price(Right)
@73, buyer will not exercise the option,
and will sell the dollars in the market at
spot price (no obligation)
@ 72, no impact
ATM(At the
money)
At the money is a situation where
an option's strike price is identical
to spot price. Both call and put
options are simultaneously at the
money
(Call option (Spot-Strike Price =0)
Put option (Spot-Strike price=0)
Strike Price
USDINR=72.00
Market Scenario (Spot price) on due date
USDINR=72
Call option
72-72=0
Put option
72-72=0
ITM(In the
money)
ITM is term used to describe a call
option with a strike price that is
lower than the market price of the
underlying asset, or a put
option with a strike price that is
higher than the market price of
the underlying asset.
Call option, Spot-Strike price>0
Put option, Spot – strike price<0 p="">Strike Price
USDINR=72.00
Market Scenario (Spot price) on due date
USDINR=73
Call option (in the money)
73-72=>0
Put option
71-72<0 in="" money="" p="" the="">OTM(out of
the money)
Out of the money (OTM) is term
used to describe a call option with
a strike price that is lower than
the market price of the underlying
asset, or a put option with a strike
Strike Price
USDINR=72.00
Market Scenario (Spot price) on due date
USDINR=71
USDINR=72

price that is higher than the market
price of the underlying asset where
the option goes unexercised.
Call option, Spot-Strike price<0 p="">Put option, Spot – strike price>0
USDINR=73
Call option-OTM when market price is
USD/INR=72 as 71<72 p="">Put option- OTM when market rate
USD/INR =73 as 73>72
73-72>0
S.No Terminology Explanation
8. Swaps It is a derivative contract through which two parties exchange
financial instruments. These instruments can be almost anything,
but most swaps involve cash flows based on a notional principal
amount that both parties agree to. Usually, the principal does not
change hands. Each cash flow comprises of one leg of the swap.
One cash flow is generally fixed, while the other is variable, that
is, based on a benchmark interest rate, floating currency
exchange rate, or index price.
9. Interest rate swap It is a contractual agreement between two parties to exchange
interest payments.
10. Foreign Currency
Swap
It Is an agreement to exchange currency between two foreign
parties. The agreement consists of swapping principal and
interest payments on a loan made in one currency for principal
and interest payments of a loan of equal value in another
currency.
11. Credit Exposure
Limit
It is the sum total of Current Credit Exposure (CCE) and Potential
Future Exposure (PFE).
A common credit exposure limits (CEL) to be sanctioned for
booking forward contracts or derivatives. It needs to be assessed
and sanctioned along with regular credit limits as part of regular
appraisal. As per RBI guidelines, the exposure under derivatives
and forwards is categorized under off-balance sheet exposures
for capital adequacy norms and will form part of total
indebtedness of the customer. CEL should be grouped under
Non find based limits as other off balance sheet exposure such
as LC and BG. A separate limit needs to be calculated for imports
and exports. A single limit to be sanctioned for both Contracted
(documentary evidence) and probable exposures (past
performances)
Current Credit Exposures (CCE): Sum of negative MTMs (Mark
to Market) of the customer of the outstanding contracts
Potential Future Exposure (PFE): Notional principal times CCF
(Credit Conversion Factor) based on nature of instrument and
residual maturity
Mark to Market: It is an accounting method that records the value
of an asset per its current market price.
12. Foreign currency
loan and its types
To provide access to the international markets to the Indian
exporters, for making the exports competitive, Reserve Bank of

India has introduced this loan facility of financing the Working
Capital and Term Loan requirements by way of Foreign Currency
Loans through deployment of FCNRB funds of the commercial
Banks. FCNRB(DL) / FCNRB(TL) can be availed in USD, GBP,
EURO and YEN, subject to availability of funds
FCNRB(DL) – For working capital purposes
FCNRB(TL) – For capital expenditure
13. Buyer’s credit It is a short-term credit available to an importer from overseas
lenders for financing their imports.
The overseas banks usually lend the importer based on the letter
of comfort issued by the importer’s Bank.
14. Supplier’s credit It relates to credit for imports into India extended by the overseas
suppliers.
15. External
commercial
borrowing
It is basically a loan availed by an Indian entity from a
nonresident lender in foreign currency.
Benefits: The cost of funds is usually cheaper from external
sources if borrowed from economies with a lower rate of interest.
Routes available for raising ECB: Automatic and Approval
Methods of availing ECB
Track I Medium term foreign currency denominated
ECB with min. average maturity of 3/5
years
Track II Long term foreign currency denominated
ECB with min. average maturity of 10 years
Track III INR denominated ECB with min. average
maturity of 3/5 years
ECB - End uses falling under Negative List
• Investment in Real Estate
• Purchase of Land
• Investment in capital market
16. Foreign Currency
convertible bond-
FCCB
It is a type of convertible bond issued in a currency other than the
issuer’s domestic currency. In other words, the money being
raised by the issuing company is in the form of a foreign
currency. A convertible bond is a mix between debt and equity
instrument. The bonds also give the option to bondholder to
convert the bond into stock.
Advantages of FCCB
• FCCB issuance allows companies to raise money outside
the home country thereby enabling tapping of new markets
for investment options
• FCCBs Aare generally issued by companies in the

currency of those countries where interest rates are
usually lower than the home country.
• FCCB holder may choose to convert the bonds into equity
to benefit out of the equity price appreciation that may
have taken place.
• FCCB holder enjoy the safety of guaranteed payments on
the bond and may opt to continue with the bond if equity
conversion is not beneficial.
17. “All in cost” in
Trade credits
It includes arranger fee, upfront fee, management fee,
handling/processing charges, out of pocket and legal expenses if
any. In trade credit the ceiling is 6 M LIBOR plus 350 basis points
as advised by RBI
18. American
Depository Receipt
(ADR)
It is a security issued by a bank or a depository in United States
of America against underlying rupee shares of a company
incorporated in India.
19. Global Depository
Receipt
It is a security issued by a bank or a depository outside India
against underlying rupee shares of a company incorporated in
India.
20. Foreign Direct
Investment (FDI)
It is the investment through capital instruments by a person
resident outside India (a) in an unlisted Indian company; or (b) in
10 percent or more of the post issue paid-up equity capital on a
fully diluted basis of a listed Indian company.
21. Foreign Portfolio
Investment (FPI)
It is any investment made by a person resident outside India in
capital instruments where such investment is (a) less than 10
percent of the post issue paid-up equity capital on a fully diluted
basis of a listed Indian company or (b) less than 10 percent of the
paid-up value of each series of capital instruments of a listed
Indian company.
22. Joint Venture (JV)/
Wholly Owned
Subsidiary (WOS)
It means a foreign entity formed, registered or incorporated in
accordance with the laws and regulations of the host country in
which the Indian party makes a direct investment.
A foreign entity is termed as JV of the Indian Party when there
are other foreign promoters holding the stake along with the
Indian Party. In case of WOS entire capital is held by the one or
more Indian Company.
23. Escrow account It is a third-party account. It is a separate bank account to hold
money which belongs to others and where the money parked will
be released only under fulfillment of certain conditions of a
contract. It is a temporary pass through account as it operates
until the completion of a transaction process, which is
implemented after all the conditions between buyer and the seller
are settled. An escrow account is an arrangement for
safeguarding the seller against its buyer from the payment risk for
the goods or services sold by the seller to buyer. This is done by
removing the control over cash flows from the hands of the buyer

to an independent agent. The independent agent, i.e. the holder
of the escrow account would ensure that the appropriation of
cash flows is as per the agreed terms and condition between the
transaction parties. In India, it is widely used in Public partnership
projects in infrastructure. RBI has also permitted banks to open
escrow accounts on behalf of Nonresident corporate for
acquisition/ transfer of shares/convertible shares of an Indian
company
24. Factoring It is a financial transaction in which an exporter sells its accounts
receivable (i.e. invoices) to a third party (called a factor) at a
discount. Factoring involves the selling of all the accounts
receivable to an outside agency (Factor). A business will
sometimes factor its receivable assets to meet its present
immediate cash needs. It is a short-term financing of receivables
up to 90 days.
Benefits of Factoring
• A non-recourse factor will assume the risk of bad debt.
• Factoring is not a loan and therefore no debt obligation on
the exporter
• Improved cash flow enhances the productivity.
25. Forfeiting It is a method of export financing in which the forfeiter purchase
an exporter’s receivables at a discount price and takes all the risk
of non-payment of the importer. Forfeiting is a buying a long term
long term receivables.
Benefits to Exporter
• 100% Financing without recourse and bank credit limits
are freed to that extent.
• Receivables becomes current cash and improves financial
status of the exporter.
• The exporter can save his cost of administration and
management of the receivables.
26. Bond It is a debt instrument in which an investor loans money to any
entity(typically corporate or government) which borrows the funds
for a defined period at a variable or fixed interest rate. Owners of
bonds are debt holders or creditors of the issuer.
27. Government
Security
(G-Sec)
It is a tradeable instrument issued by the Central Government or
the State Governments. It acknowledges the Government’s debt
obligation. Such securities are short term (usually called treasury
bills with original maturities of less than one year) or long term
(usually called Government bonds or dated securities with
original maturities maturity of one year or more). In India, the
Central Government issues both, treasury bills and bonds or
dated securities while the State Government issue only bonds or
dated securities, which are called the State Development Loans
(SDLs). G-Secs carry practically no risk of default and hence are
called risk free gilt edged instruments.

28. Treasury Bills (TBills)
They are money market instruments, are short term debt
instruments issued by the Government of India and are presently
issued in three tenors, namely 91 day, 182 day and 364 day.
Treasury bills are zero coupon securities and pay no interest.
They are issued at a discount and redeemed at the face value at
maturity.
29. Packing credit It is a loan/advance granted to an exporter for financing the
purchase, processing, manufacturing and/or packing of goods
prior to shipment.
30. Packing credit in
foreign currency
(PCFC)
Preshipment/Packing Credit granted in a foreign currency is
called PCFC. The aim is to provide the access of credit to
exporters at internationally competitive rates.
31. Bills Discounting It is a facility where bank pays the amount of the bill to the drawer
in advance. These instruments are in the nature of usance or
time bills or in other words there are also bills drawn with a credit
period (usance) which are payable after the credit period. They
become due on a specified date say 60 or 90 days from the date
of drawing, after which sales proceeds are realised from the
drawee. The interest for the usance period is deducted up-front
while creating a loan.
32. Bill Purchase It refers to demand bills which are paid immediately by the bank
in advance before realisation of proceeds. This is typically the
case with sight bills, where fixed maturity is not known. The loan
will be created for the full value of the draft and the interest will be
recovered when the actual payment comes. If a bank lends
against such bills receivable, it is called as bill purchase.
33. Bill Negotiation Negotiation of bill happens if shipment is under LC terms, the
bank verifies and satisfies all necessary terms and conditions
under letter of credit and negotiate thee export bills. The invoice
amount under the said shipment is credited to exporters account.
After realization of the export proceeds from the overseas buyer,
the bank deducts the necessary bank interest from the
negotiation date till realization.

Thursday, 26 December 2019

MSME recollected questions April 2019

MSME FOR BANKERS (EXAM DATED 27.04.2019)

1. MSME represent ------- policies of Government of India which emphasized to use foreign exchange for imports etc (Ans: Socio Economic)

2. Objectives of MSME identification which among is not an objective (Page 4 of Text Book)

3. Limitations of MSME. Identify which among is correct (Page 4 of Text Book)

4. The MSME is made important subject in development in (Ans: Worldwide including countries like USA, Japan)

5. The classification of industries is based on different factors. Which among the following is wrong (Ans: Loan Amount)

6. Explanation of export oriented Unit (Ans: Industry that undertakes to export 30% of annual production at the end of third year)

7. Which among the following is not falls in Small Business (Ans: Wholesale Trade)

8. For the transport operator is categorized as MSE, if total vehicle owned does not exceed (Ans: 10)

9. The de reservation of items as per Sec 29 B of Industries act 1951. Find out wrong features (Page 10 of Text Book)

10. Micro Enterprises Manufacturing & service investment criteria (Ans. 25 Lacs & 10 lacs)

11. Which among the following is the example of indirect finance (Ans: MFI lending to co-operatives of producers)

12. Which among the following is not a feature of Sole Proprietary firm (Ans: Income is distinguished for taxation)

13. Mr. Ram a minor turned major on 01.02.2016, who was admitted to a partnership firm during his minority. What is the maximum time before which he can repudiate his liability (Ans: 6 months from date )

14. Which among the following is not a feature of partnership firm (Ans: A partnership firm can be a partner in another firm)

15. Which among the following is a feature of partnership firm (Ans: A partnership firm not require compulsory registration of deed)

16. The usage of common seal is explained in which document. (Ans: Articles of Association)

17. Maximum number of share holders in Private Limited Company is (Ans: 200)

18. Which among the following is not a feature of Public Limited Company (Ans: The shares are freely not transferrable)

19. For getting environmental clearance for the setting up of an enterprises one must (Ans: Obtain clearance from the pollution board)

20. If the ownership of any enterprise is individually or jointly hold by women above 51%, the same is termed as (Ans: Woman Enterprises)

21. The gender discrimination in Market is by (Ans: Differential wage for the same work)

22. Which among the following is not a classification of categories of Women Entrepreneurs (Ans: Literate and illiterate women)

23. Exclusive scheme to provide equity support to women entrepreneurs (Ans: Mahila Udhyam Nidhi)

24. Which among the following is not a supportive measures for Women’s economic activities (Ans: Refer Page ; 24 in text book)

25. MSME DO is earlier known as (Ans; Small industries Development Organization)

26. The development of MSME is a (Ans: State Subject )

27. An industrial undertaking, a company with interests in industry can invest up to _____ in a MSE unit (Ans; 24%)

28. Similarity features identification between LLP & a Private Limited Company (Ans: Refer Page ; 45 in text book)

29. TReDS full form (Ans: Trade Receivables Discounting system )

30. Which among the features pertains to Priority Sector Lending Certificates

31. CERSAI is formed as per the (Ans: SARFAESIA act of 2002)

32. Calculation for maximum CGTMSE coverage available for unit with Rs 30.00 Lacs fund based & 15 Lacs non fund based limit.

33. The current liability is 50000. The current ratio is 2.5. calculate Current asset

34. The CLSS scheme gives subsidy of ( 15% or 0.15)

35. Which among the given option is not a rating agency (Ans; NSIC)

36. Which among the following is give overall guidelines of SIDO (Ans; Directorate of industries)

37. Features of HUDCO. Select the one wrongly explained (Ans: Refer Page ; 61 in text book)

38. Activities of TCO. Which among is correct combination (Ans: Refer Page ; 62 in text book)

39. Which among the following is features of KVIC (Ans: Refer Page ; 63 in text book)

40. The credit limit up to 5 Lacs to be disposed in maximum of (Ans; 2 Weeks)

41. Which among the following is wrongly stated regarding the functions of SIDBI (Ans: Refer Page ; 70 in text book)

42. Major problems faced by MSME in the given option (Ans: Refer Page ; 92 in text book)

43. Which among the following is not a feature for commercial banks or promoting the MSE advance portfolio (Ans: Low NPA)

44. Identify which are the following is bill financing

45. Which among the following is example of post shipment finance (Ans: Refer Page ; 109 in text book)

46. RED Clause LC Feature (Ans: Refer Page ; 111 in text book)

47. Specialized MSME branch (Ans: if advance is 60% MSE portfolio)

48. BCSBI guidelines for MSE regarding acknowledgement of application & issuance of rejection letter with reason

49. Which among the given option is not associated with 5 Cs of the borrower (Ans: CIBIL score )

50. Identify and add the total assets from the given balance sheet component

51. What is the implication and effect in increase of Sundry Debtors or creditors (Ans; Refer Page ; 124 in text book)

52. Maximum Limit of loan that can be sanctioned under Turnover method (Ans: Rs 500.00 Lacs)

53. Factors affecting/determine the working capital limit (Ans: Refer Page ; 138 in text book)

54. Calculation using II method of lending (Ans; Refer Page ; 143 in text book)

55. Overview of Risk features , by way of match the following (Ans: Refer Page ; 145 in text book)

56. Features and requirement of credit rating (Ans: Refer Page ; 148 in text book)

57. Economic benefits of MSME. Identify the features (Ans: Refer Page ; 165 in text book)

58. The common parlance and practices of BDS is (Ans: Operational)

59. Identify the support by BDS (Ans: Refer Page ; 170 in text book)

60. Nature of deficiencies and remedial measures in cluster development (Ans; Refer Page ; 198 in text book)

61. Growth phase of MSE cluster features

62. Role of CDE in the cluster (Ans; Refer Page ; 209 in text book)

63. Why agricultural land is not taken as collateral security for securing the loan

64. Delayed payment of the bill raised by the MSE entrepreneur is compensated by (Ans: 3 times of bank rate announced by RBI)

65. RBI definition of Sick unit

66. Identify which among the following is external cause of sickness (Ans: Power Shortage)

67. When long term source is used for short term uses, the same is amounts to (Ans; Diversion of funds)

68. Feature of an enterprises tending towards sickness (Ans: Refer Page ; 242 in text book)

69. Symptoms of incipient sickness in activity (Ans; Refer Page ; 243 in text book)

70. Explanation of SICK GREY AREA

71. Hand holding stage features (Ans: Refer Page ; 253 in text book)

72. The account of NPA with dues of Rs 2.00 lacs, who will finalize the viability (Ans: Branch manager)

73. Viability criteria (Ans: Refer Page ; 256 in text book)

74. Primary purpose of secured creditors with NPA asset is (Ans; To sell off for the purpose of loan)

75. The 13(2) notice to be given as per SARFAESIA for how many days (Ans: 60 days )

76. Asset Reconstruction companies are registered with (Ans: RBI)

77. The reason for the existence of MFI (Ans: Refer Page ; 273 in text book)

78. Multiple lending and over indebtedness of MFI (Ans: Refer Page ; 276 in text book)

79. Primary Objectives of Mudra Bank (Ans: Refer Page ; 279 in text book)

80. Primary security & Collateral security features

81. Customer DNA means

82. Insolvency & Bankruptcy difference between two

83. Features of Bank’s Board Bureau

84. Impact of WTO agreements in domestic industry (Ans: Refer Page ; 305 in text book)

85. Which sector among the given option is contributing to exports (Ans: Textile)

86. Calculation of Plant & machineries value from given options (Ans: Not to include Jigs, generator sets etc)

87. Which among the following is not a participant of importance/much role in an LC? (Ans: Beneficiaries’ Bank)

88. Explanation of LC, which among the given options is correct

89. Which among is pre shipment finance?

90. Which among the following is not correct for loan sanction in MSME segment (Ans: Compulsory to give collateral free loan till 100 lacs)

Risk management and credit rating

Risk Management and credit rating::

The risk that the banking business faces, can be:
· Credit risk
· Market risk (resulting from adverse movement of prices of govt. securities, interest rates, forex etc.)
· Operational risk (resulting from staff errors, failure of internal processes, external events etc.)
Credit Risk : It refers to the possibility of loss that the bank or financial institution may suffer as a consequence of inability of
the counterparty (i.e. the borrower, who is operating in an environment having many uncertainties resulting in threat to the
viability and sustainability of the activity) to meet its repayment or other commitment/s as per agreed conditions and commit
default.
Reserve Bank of India states that the credit risk or default risk involves inability or unwillingness of a customer or counterparty to
meet commitment in relation to lending, trading, hedging, settlement and other financial transactions.
In terms of the guidelines issued by RBI, the credit risk is generally made up of (I) transaction risk or default risk and (2) portfolio
risk. The portfolio risk in turn comprises intrinsic and concentration risk.
· The transaction risk is the risk arising from an individual transaction or a counterparty or b orrower's default in meeting the
commitment.
· The intrinsic risk is the risk which is inherent in respect of an activity due to the operating environment. This is also termed as
industry or activity risk.
· The concentration risk refers to the risk which arises as a result of undertaking exposure in only few industries or activities or
lines of business or borrowers and borrowing groups without ensuring the diversification of the portfolio.
Why does credit risk arise ?
The credit risk arises due to operation of a number of external and internal factors.
The external factors are the state of the economy of the concerned country or state or even global economy, wide swings in the
prices of various commodities, foreign exchange rates, interest rates, trade restrictions, economic sanctions, Govt. policies, natural
calamities etc.
The internal factors are the factors which may be internal to the borrower or internal to the financing institution.
· The factors internal to the borrowing entity may be planning factors, execution factors, finance factors, marketing factors,
management factors etc.
· The factors internal to the financing banks or institutions relate to the deficiencies in loan policies/administration,
absence of prudential credit concentration limits, inadequately defined lending limits for loan officers/credit committee,
deficiencies in appraisal of borrowers' financial position, excessive dependence on collaterals and inadequate risk pricing,
absence of loan review mechanism and post sanction surveillance etc.
Steps for credit risk mitigation:
The objective of mitigation is the restrict the risk within an acceptable limit and it involves steps to be taken at (a) macro level in
the bank and (b) micro level in the bank.
At Macro Level:
i. Frequent review of norms and fixing internal limits for aggregate commitments to specific sectors of industry and business.
2. periodical review of loan policies.
3. classification of portfolio based on certain parameters of quality
At Micro Level:
i. framing of policy regarding credit appraisal standards, sanction and delivery process, monitoring and review of individual
borrowers, obtaining collaterals.
2. obtaining credit rating and their updation.
Credit rating
The credit risk differs for each project and each promoter. The appraisal of proposal done with a view to measure the risk involved
and its quantification by using a credit rating method, with following objectives:
i. to take a decision whether to accept or reject a proposal without or without modification
2. to determine the rate of interest (risk pricing)
3. to help in. macro evaluation of the total credit portfolio by classifying the individual loan account in a specific category,
depending up on the rating.
Rating Models:
The rating can be done by using internal rating model available with the bank. Most of the banks have their rating models.
The rating can also be got done by using service of external rating agencies such as CRISIL, SMERA, CARE, ICRA etc.

Credit rating methodology:

Banks the credit rating model, based on which they are able to place their borrower in a particular rating category. The broader
categories of risk area that the rating models take into account are:
1. Management related aspects
2. Security related aspects
3. Financial aspects on the basis of financial statements
4. Business risk
These ratings are required to be reviewed periodically, in view of dynamic nature of the business of the borrower.
Derivative instruments for Credit Risk Management
The derivative instruments are used to hedge the inherent credit risk without transferring the loan account. Simple techniques for
transferring credit risk are available with the banks for very long time which include guarantors, collateral securities, credit
insurance from agencies like DICGC, CGTMSE. In recent some new instruments have also been introduced that include (a) Credit
default swaps and (b) credit linked notes.
Credit default swaps (CDS) : It is a contract between the financing bank (risk seller) and protection seller, whereby the protection
seller provides protection against credit events (i.e. default). For this purpose, the risk seller makes payment of premium to the
protection seller. The credit events include bankruptcy, failure to pay, restructuring etc.
Credit linked notes (CLN): In this arrangement, the protection seller (normally a special purpose vehicle — SPV) issues notes linked
to underlying credit. These notes can be purchased by general public as investors and the SPV purchases high rated securities with
that amount. On maturity, these securities are sold and money is returned to investors, if there is no credit default. In case of
credit default, the funds are used to make payment to risk seller.
The risk seller makes regular payment of premium.
New Capital Accord (Basel 2) : Implications on Credit Risk
The Basel Committee on Banking Supervision has proposed 3 approaches, viz.,
1. Standardised and
2. Foundation Internal Rating Based Approach
3. Advanced Internal Rating Based Approach
In India, presently the Standardized approach has been implemented.
Under the standardised approach, preferential risk weights in the range of o%, 20%, 50%, 100% and 150% are assigned by RBI for
certain risk weighted assets and some discretion has been given to bank where they can allot risk weight on the basis of external
credit assessments.
Internal Rating Based Approach
There are two approaches — foundation and advanced - as an alternative to standardised approach for assigning preferential risk
weights. Under the foundation approach, banks, which comply with certain minimum requirements viz. comprehensive credit
rating system. The adoption of these approaches requires substantial upgradation of the existing credit risk management systems.
The time schedule fixed by RBI for migrating to Internal Rating Based approach is as under: The earliest date of making application by
banks to RBI — April 01, 2012 Likely date of approval by RBI — March 31, 2014.
The banks have been advised by RBI to undertake an internal assessment of their preparedness for migration to advanced approaches,
in the light of the criteria envisaged in the Basel II document, as per the aforesaid time schedule, and take a decision, with the approval
of their Boards, whether they would like to migrate to any of the advanced approaches. The banks deciding to migrate to the advanced
approaches should approach us for necessary approvals, in due course, as per the stipulated time schedule. If the result of a bank's
internal assessment indicates that it is not in a position to apply for implementation of advanced approach by the above mentioned
dates, it may choose a later date suitable to it based upon its preparation.
It may be noted that banks, at their discretion, would have the option of adopting the advanced approaches for one or more of the
risk categories, as per their preparedness, while continuing with the simpler approaches for other risk categories, and it would not
be necessary to adopt the advanced approaches for all the risk categories simultaneously. However, banks should invariably obtain
prior approval of the RBI for adopting any of the advanced approaches

Kyc aml mcqs

AML-KYC
1. In the process of customer identification, the customer identification data should be updated __________ in 5 years in case of low risk category, and __________ in case of medium and high risk category customers.
1. Twice; 1 year
2. Once; 1 years
3. Twice; 2 years
4. Once; 2 years*
2. ____________ is the process of keeping the amount lower than that fixed for reporting and building similar transactions till the amount planned to be laundered is reached fully.
1. Entrailing
2. Lading
3. Slushing
4. Smurfing*
3.What information about the correspondent bank must be available
1. Major business activities
2. The bank's management
3. Level of AML/KYC compliance
4. All of the above*
4. Which of the following acts defines the offence of Money Laundering as under – “Engaging directly or indirectly in a transaction that involves property, that is proceeds of crime (or) derived from proceeds of crime (or) knowingly receiving, possessing, concealing, disguising, transpiring, converting, disposing off within the territories of India, removing form or bringing into the territory of India the property that is proceeds of crime”
1. Anti-Money Laundering Act, 2005
2. Active Money Laundering Act (AMLA), 2003
3. Prevention of Money Laundering Act (PMLA), 2002*
4. Impediment of Money Laundering Act (PMLA), 2002
5. Which of the following is a high risk activity?
1. A customer purchasing a car from a local garage
2. Printing a statement for a customer
3. A loan for home improvement
4. Money transfer to unknown third parties*
6. Please read the KYC practice given below. Identify the KYC element which best relates to the stated practice. Well-developed and applied customer assessments enable identification and classification of potentially high-risk customers. This is known as _____________.
1. customer acceptance*
2. customer identification
3. accounts and transaction monitoring
4. risk management
7. Which of the crime is not included under PMLA, 2002 for proceeds of crime
1. Drug trafficking
2. Kidnapping
3. Murder
4. None of the above*
8. Who file a report onward to the FIU-IND, if the Bank concludes that a transaction is suspicious
1. PO*
2. senior management
3. Internal Audit and Control team
4. None of the above
9. Laundering might attempt a series of small currency transaction over time because _____________.
1. a provision of the bank secrecy act requires the filing of CTR for a transaction exceeding Rs. 10 Lakhs*
2. Larger amount are too risky to carry around
3. that's the way in which launderers take in the funds
4. None of the above
10. The three stages of money laundering are ____________.
1. Layering, Placement, Refining
2. Placement, Refining, Integration
3. Refining. Integration, Layering
4. Integration, Layering, Placement*
11. What should awareness and training of staff on AML/KYC, should cover
1. need to know the true identity of the customer
2. need to know enough about the nature of business activities expected
3. to know what might constitute suspicious activity
4. All of the above*
12. Money laundering involves three independent steps that often occurs simultaneously. Which of the following best explains the layering in the process of money laundering?
1. Physically placing bulk cash proceeds
2. Separating the proceeds of criminal activity from their origin, through complex level of financial transactions*
3. Providing a legitimate explanation for the illicit proceeds
4. None of the above
13. What is not audited by Internal Audit and Control teams of the banks
1. adequacy of policies
2. adequacy of procedures
3. system support to detect suspicious and potential money laundering transaction
4. None of the above*
14. What should you consider when managing AML/CTF in your business?
1. Knowing your customer
2. Destination of funds
3. Methods of delivery such as cash, telephone and internet banking
4. All of the above*
15. When is induction training provided to employees
1. start of their employment*
2. end of their employment
3. Depends upon trainer availability
4. Depends upon training schedule
16. What services are offered by correspondent banks
1. International wire transfers
2. Cheque clearing
3. Cash/fund transfers
4. All of the above*
17. ____________ is a bank which is incorporated in a country where is no physical presence and is not affiliated to any regulated financial group.
1. Correspondent Bank
2. Shell Bank*
3. Respondent Bank
4. Compendium Bank
18. Which element of an effective transaction monitoring process, involves scrutiny of the transactions carried out by the customer over a longer period of time
1. Analysis of transactions*
2. Identification of Exceptional transactions
3. Enhanced Due Diligence
4. None of the above
19. Which of the following should be treated as a ‘customer’ for prudent KYC analysis?
1. any person or company which can conduct a transaction in relation to an account offered by a ban
2. any person who is a signatory to an account offered by a building society
3. any person or company which holds an account issued by a credit union
4. All of the above*
20. Customer verification is vital to any KYC procedure. What is acceptable in verifying an individual customer? Select the incorrect response from the alternatives below. In verifying an individual customer, you can rely on ____________.
1. a certified copy of a birth certificate in conjunction with the customer's drivers licence and Medicare card
2. sighting original identification such as birth certificate and drivers licence
3. a reference from a good friend*
4. None of the above
21. ________________ services are used to buy or sell foreign currencies, to consolidate small denomination bank notes into larger ones, or to exchange financial instruments. Criminals are attracted to this method of laundering as they are not as heavily regulated as traditional financial institutions.
1. Remittance
2. Bureaux De Change*
3. Back-to-Back Loans
4. Collection Accounts
22. ________________ are fake companies that appear on paper, but may not physically exist.
1. Shell Companies*
2. Front Companies
3. Offshore Banking
4. Hawala Systems
23. During customer acceptance and identification activities, on which of the following customers should enhanced due diligence be conducted?
1. trustees, nominees, and fiduciaries
2. non-face-to-face customers
3. correspondent accounts
4. All of the above*
24. Which one of the following is a Valid document available to the bank for customer identification?
1. Election ID card*
2. Ration Card
3. Bank statement of account
4. Photograph
25. Which of the following terms is used to describe the process of sending money through multiple financial institutions to make it difficult to track?
1. Integration
2. Camouflage
3. Placement
4. Layering*
26. What should be recorded regarding records of employee training on AML/KYC
1. date of training
2. nature of the training received
3. attendance
4. All of the above*
27. Money derived from criminal activity is known as _______________.
1. Proceeds Possession
2. Proceeds of Crime*
3. Dirty Money
4. Crime Laundering
28. Money laundering is the result of crime and the persons behind the crimes appear to be using banking channels for the purpose of _______________. (I) fund transmission (II) creating a legal front of money raised through illegal and humanity demeaning methods.
1. Only (I) above
2. Only (II) above
3. Both (I) and (II) above*
4. None of the above
29. What should employees be aware about the handling of transactions which may involve money laundering
1. potential effect on the bank
2. potential effect on bank's employees
3. potential effect on bank's customers
4. All of the above*
30. Which of the following are required documents to establish both the identity and the correct address while opening accounts of companies? (I) Certificate of incorporation and Memorandum of Articles of Association (II) Resolution of Board of Directors to open an account, and identification of those who have the authority to operate the account (III) Power of Attorney granted to a partner or an employee of the firm to transact business on its behalf (IV) Copy of PAN allotment letter (V) Copy of telephone bill
1. (I), (II), (III) and (IV) above
2. (I), (II), (IV) and (V) above
3. (II), (III), (IV) and (V) above
4. (I), (II), (III), (IV) and (V) above*
31. _______________ is the provision of banking services by one bank to another bank.
1. Respondent Banking
2. Crude Banking
3. Correspondent Banking*
4. None of the above
32. While monitoring of customer transaction it should be ensured that there is no _________ i.e., manipulation of the size of transaction so that if seen individually they fall below the threshold that needs to be reported to the monitoring authority.
1. Entrailing
2. Structuring*
3. Lading
4. Slushing
33. AML/KYC guidelines are issued under ____________.
1. BR Act,1949
2. PMLA,2002
3. RBI Act
4. Both A and B above*
34. _____________ is a matrix of different components (such as source of funds, level of income, volume and frequency of transaction etc) that helps arrive at a benchmark transaction for individual customer transactions, against which a comparison can be made.
1. KYC Profile
2. Customer Risk Profile
3. Transaction Profile*
4. Interim Profile
35. Please read the KYC practice given below. Identify the KYC element which best relates to the stated practice. High-risk customer activity is regularly reviewed and substantial high-risk customers are personally known to management. This is known as _____________.
1. customer acceptance
2. customer identification
3. accounts and transaction monitoring*
4. risk management
36. Money Laundering refers to ____________.
1. Conversion of cash in to gold
2. Conversation of assets into cash
3. Conversion of assets into cash
4. Conversion of money which is illegally obtained*
37. How does KYC checks be communicated to customers of bank
1. Incorporating the requirements in the account opening forms
2. Publishing relevant information on the websites of the bank
3. Providing a ready reckoner on frequently asked questions related to KYC
4. All of the above*
38. As a manager/Compliance officer, it is a part of your job to ____________.
1. Maintain your companies AML Program
2. Ensure that proper reports are filed and records are maintained
3. Ensure that all employees report suspicious activities
4. All of the above*
39. What factors and characteristics come into play for the process of customer profiling
1. buying patterns
2. creditworthiness
3. purchase history
4. All of the above*
40. CTR stands for ____________.
1. Custom Trafficking Report
2. Current Transaction Receipt
3. Currency Transaction Report*
4. Criminal Trading Raid
41. ______________ are engaged in selling goods and providing services, with large volume of business and often engaged in cash dealings.
1. Shell Companies
2. Front Companies*
3. Offshore Banking
4. Hawala Systems
42. Which of the following document/s can be accepted by banks as a proof of Customer Identification?
1. Electricity Bill
2. Salary Slip
3. Income/Wealth Tax Assessment Order
4. Election I card*
43. What should relevant employees be aware of
1. Policies and procedures put in place to prevent money laundering
2. Procedures put in place to prevent money laundering
3. KYC/AML guidelines issued by the RBI
4. All of the above*
44. What objective parameters can be used for enhanced due diligence
1. Customer location
2. Financial status
3. Nature of business
4. All of the above*
45. PAN (Permanent Account Number) is compulsory for Fixed Deposits, Remittances like DDs/TTS/RTCs etc _________.
1. if the amount exceeds Rs.10,000
2. if the amount exceeds Rs.25,000
3. if the amount exceeds Rs.50,000*
4. no such limit is fixed by the Income Tax Authorities
46. What are not the responsibility of the senior management
1. Appointment of PO
2. Managing the risk of money laundering
3. Internal Reporting Procedures
4. None of the above*
47. Which of the following is an example of smurfing?
1. Wiring money to a foreign country
2. A broker buying dollars with rupees
3. A drug dealer asking a stranger to buy money order with drug money*
4. All of the above
48. A lawyer who banks with you is a sole practitioner. He wants to open a trust account for a client. He provides you with the trust documents and the name and address of the trust beneficiary but is unable to provide additional details due to a client confidentiality obligation. You notice that the address is from an overseas jurisdiction. What level of due diligence would be required?
1. This situation does not require enhanced due diligence. You know the lawyer well and you have been provided with the trust documents and identity of the beneficiary.
2. This situation requires enhanced due diligence because an offshore jurisdiction is involved*
3. This situation requires enhanced due diligence because the lawyer is clearly hiding something when he says he is under a client confidentiality obligation
4. None of the above
49. Please read the KYC practice given below. Identify the KYC element which best relates to the stated practice. Effective information-gathering strategies enable building of a solid information base about each customer. This is known as ______________.
1. customer acceptance
2. customer identification*
3. accounts and transaction monitoring
4. risk management
50. What suspicion does frequent cash deposits in the account followed by ATM withdrawals at different locations with no valid explanation, can lead to
1. Doubtful source of cash deposited in bank account
2. Doubtful use of safe deposit locker
3. Suspicious use of ATM card*
4. None of the above
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CCP recollected October 2109

Questions were mainly from conceptual undestandings Export Credit (LC), Tandon Committee, IRAC norms, Priority Sector Lending Certificates, Restructuring, Financial Ratios

CP
WC(1nd and 2nd method)
Break even case study
ICR
Ratios interpretation
WCG
Syndication
Consortium

Minors
Public ltd company
Charge creation

Mortgage