Banking and Financial Awareness for BOB/IBPS Exams

Q1. The definition of the priority sector was first formalised in 1972 by?
(a) Planning Commission 
(b) National Development Council 
(c) Reserve Bank of India 
(d) Ministry of Finance, Government of India 
(e) None of the above

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Q2. Liquidity ratio is fixed by the Reserve Bank of India under the powers conferred on it by?
(a) Reserve Bank of India Act, 1934
(b) Companies Act, 1956
(c) Banking Regulation Act, 1949
(d) Special Powers given by the Union Ministry of Finance
(e) None of the above 
Q3. The largest number of commercial banks’offices are located in?
(a) Karnataka 
(b) Maharashtra
(c) Tamil Nadu 
(d) Uttar Pradesh 
(e) None of the above
Q4. Which of the following is not a member of the World Bank Group?
(a) International Bank of Reconstruction and Development 
(b) International Development Association 
(c) Bank of International Settlement
(d) International Finance Corporation
(e) None of the above
Q5. Every bank wishing to commence banking business in India is required to obtain a licence from?
(a) Government of India, Ministry of Finance 
(b) Government of India, Company Law Board 
(c) Reserve Bank of India 
(d) Registrar of Companies 
(e) None of the above
Q6. When was the currency system in India converted  into decimal system?
(a) From 1st April, 1957 
(b) From 1st April, 1959 
(c) From 1st April, 1961 
(d) From 1st April, 1963 
(e) None of the above
Q7. Statutory cash reserve ratio for scheduled banks is regulated by Reserve Bank of India under powers conferred upon it by?
(a) Reserve Bank of India Act, 1934 
(b) Banking Regulation Act, 1949
(c) Companies Act, 1956 
(d) Union Ministry of Finance 
(e) None of the above
Q8. Net Interest Income means? 
(a) Interest generated from bank’s assets less interest paid on liabilities 
(b) Interest earned on advances 
(c) Miscellaneous Income 
(d) All of the above
(e) None of the above
Q9. No licence from RBI is required for? 
(a) opening a new bank branch in India 
(b) opening a new bank branch outside India 
(c) shifting an existing branch outside the city, village or town 
(d) shifting an existing branch within the same city, village or town
(e) None of the above
Q10. In NRE account, rate of interest is linked to? 
(b) Bank 
(c) PLR 
(d) RBI 
(e) None of the above
Q11. In the Money market operations, the item widely accepted is?
(a) Inter Bank Participation Certificates 
(b) Certificate of Deposits 
(c) Treasury Bills 
(d) All of the above 
(e) None of the above
Q12. To meet a significant increase in demand for bank credit, a bank may?
(a) make use of excess reserves 
(b) borrow from other banks 
(c) borrow from the Reserve Bank of India 
(d) All of the above 
(e) None of the above
Q13. The “bank rate” is?
(a) free to fluctuate according to the forces of demand and supply 
(b) set by the Reserve Bank of India
(c) set by the Reserve Bank of India as directed by the Union Ministry of Finance 
(d) set by the Reserve Bank of India as directed by the Indian Banks’ Association
(e) None of the above
Q14. Pledge means? 
(a) advance against goods 
(b) open working capital limits 
(c) bailment of goods as security for payment of a debt or performance of a promise 
(d) All of the above 
(e) None of the above
Q15. What are the RBI guidelines for the development of Interest Rate Swaps (IRS)? 
(a) Banks can use IRS for hedging and Trading both 
(b) MIFOR is a benchmark for IRS
(c) Under ISDA agreement Banks can opt for dual jurisdiction i.e., Indian as well as common law 
(d) All of the above 
(e) None of the above