Statement: Shalini made an application to the bank for a loan of Rs. 1,80,000 by mortgaging her house to the bank and promised to repay it within five years. Assumptions: The bank has a practice of granting loans for Rs. 1,00,000 and above. The bank ?->(Show Answer!)

1. Statement: Shalini made an application to the bank for a loan of Rs. 1,80,000 by mortgaging her house to the bank and promised to repay it within five years. Assumptions: The bank has a practice of granting loans for Rs. 1,00,000 and above. The bank accepts house as collateral security against such loans.

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MCQ->Statement: Shalini made an application to the bank for a loan of Rs. 1,80,000 by mortgaging her house to the bank and promised to repay it within five years. Assumptions: The bank has a practice of granting loans for Rs. 1,00,000 and above. The bank accepts house as collateral security against such loans.

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MCQ-> Read the following passage carefully and answer the questions given at the end.Passage 4Public sector banks (PSBs) are pulling back on credit disbursement to lower rated companies, as they keep a closer watch on using their own scarce capital and the banking regulator heightens its scrutiny on loans being sanctioned. Bankers say the Reserve Bank of India has started strictly monitoring how banks are utilizing their capital. Any big-ticket loan to lower rated companies is being questioned. Almost all large public sector banks that reported their first quarter results so far have showed a contraction in credit disbursal on a year-to-date basis, as most banks have shifted to a strategy of lending largely to government-owned "Navratna" companies and highly rated private sector companies. On a sequential basis too, banks have grown their loan book at an anaemic rate.To be sure, in the first quarter, loan demand is not quite robust. However, in the first quarter last year, banks had healthier loan growth on a sequential basis than this year. The country's largest lender State Bank of India grew its loan book at only 1.21% quarter-on-quarter. Meanwhile, Bank of Baroda and Punjab National Bank shrank their loan book by 1.97% and 0.66% respectively in the first quarter on a sequential basis.Last year, State Bank of India had seen sequential loan growth of 3.37%, while Bank of Baroda had seen a smaller contraction of 0.22%. Punjab National Bank had seen a growth of 0.46% in loan book between the January-March and April-June quarters last year. On a year-to-date basis, SBI's credit growth fell more than 2%, Bank of Baroda's credit growth contracted 4.71% and Bank of India's credit growth shrank about 3%. SBI chief Arundhati Bhattacharya said the bank's year-to-date credit growth fell as the bank focused on ‘A’ rated customers. About 90% of the loans in the quarter were given to high-rated companies. "Part of this was a conscious decision and part of it is because we actually did not get good fresh proposals in the quarter," Bhattacharya said.According to bankers, while part of the credit contraction is due to the economic slowdown, capital constraints and reluctance to take on excessive risk has also played a role. "Most of the PSU banks are facing pressure on capital adequacy. It is challenging to maintain 9% core capital adequacy. The pressure on monitoring capital adequacy and maintaining capital buffer is so strict that you cannot grow aggressively," said Rupa Rege Nitsure, chief economist at Bank of Baroda.Nitsure said capital conservation pressures will substantially cut down "irrational expansion of loans" in some smaller banks, which used to grow at a rate much higher than the industry average. The companies coming to banks, in turn, will have to make themselves more creditworthy for banks to lend. "The conservation of capital is going to inculcate a lot of discipline in both banks and borrowers," she said.For every loan that a bank disburses, some amount of money is required to be set aside as provision. Lower the credit rating of the company, riskier the loan is perceived to be. Thus, the bank is required to set aside more capital for a lower rated company than what it otherwise would do for a higher rated client. New international accounting norms, known as Basel III norms, require banks to maintain higher capital and higher liquidity. They also require a bank to set aside "buffer" capital to meet contingencies. As per the norms, a bank's total capital adequacy ratio should be 12% at any time, in which tier-I, or the core capital, should be at 9%. Capital adequacy is calculated by dividing total capital by risk-weighted assets. If the loans have been given to lower rated companies, risk weight goes up and capital adequacy falls.According to bankers, all loan decisions are now being assessed on the basis of the capital that needs to be set aside as provision against the loan and as a result, loans to lower rated companies are being avoided. According to a senior banker with a public sector bank, the capital adequacy situation is so precarious in some banks that if the risk weight increases a few basis points, the proposal gets cancelled. The banker did not wish to be named. One basis point is one hundredth of a percentage point. Bankers add that the Reserve Bank of India has also started strictly monitoring how banks are utilising their capital. Any big-ticket loan to lower rated companies is being questioned.In this scenario, banks are looking for safe bets, even if it means that profitability is being compromised. "About 25% of our loans this quarter was given to Navratna companies, who pay at base rate. This resulted in contraction of our net interest margin (NIM)," said Bank of India chairperson V.R. Iyer, while discussing the bank's first quarter results with the media. Bank of India's NIM, or the difference between yields on advances and cost of deposits, a key gauge of profitability, fell in the first quarter to 2.45% from 3.07% a year ago, as the bank focused on lending to highly rated customers.Analysts, however, say the strategy being followed by banks is short-sighted. "A high rated client will take loans at base rate and will not give any fee income to a bank. A bank will never be profitable that way. Besides, there are only so many PSU companies to chase. All banks cannot be chasing them all at a time. Fact is, the banks are badly hit by NPA and are afraid to lend now to big projects. They need capital, true, but they have become risk-averse," said a senior analyst with a local brokerage who did not wish to be named.Various estimates suggest that Indian banks would require more than Rs. 2 trillion of additional capital to have this kind of capital adequacy ratio by 2019. The central government, which owns the majority share of these banks, has been cutting down on its commitment to recapitalize the banks. In 2013-14, the government infused Rs. 14,000 crore in its banks. However, in 2014-15, the government will infuse just Rs. 11,200 crore.Which of the following statements is correct according to the passage?
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MCQ-> Read the following passage carefully and answer the questions given below it. Certain words/phrases have been printed in bold to help you locate them while answering some of the questions. Once upon a time there was a King of Benaras who was very rich. He had many servants and a beautiful palace with wonderful gardens; he had chariots and a stable full of horses. But his most prized possession was a magnificent elephant called Mahaghiri. She was as tall as two men, and her skin was of the colour of thunder clouds. She had large flapping ears and small, bright eyes and she was very clever. Mahaghiri lived in her own special elephant house and had her own keeper, Rajinder. The King would often visit Mahaghiri to take her some special tit-bit to eat and check that Rajinder was looking after her properly. But Rajinder needed no reminding, for he also loved the elephant dearly, and trusted her completely. Every morning, he would take her down to the river for her bath. Then he would bring her freshly cut grass, leaves and the finest fruits he could find in the market for her breakfast. During the day, he would talk to her and, in the evening, he would play his flute to send her to sleep. One morning, Rajinder arrived as usual with fruit for Mahaghiri’s breakfast. Suddenly, before he knew what was happening, she picked him up with her trunk and threw him out of the stall, breaking his arm. She began to stamp on the ground and trumpet so loudly that it took several strong men all morning to bind her with ropes and chains, When the king heard about what had happened, he was very upset and sent for the doctor to help Rajinder. Then he called for his chief minister. “You must go and see Mahaghiri at once,” he said. “She used to be so kind and gentle, but this morning she threw her keeper out of her stall. I can’t understand it. She must be ill or in pain. Spare no expense in finding a cure.” So the chief minister went to see Mahaghiri. who was still bound firmly with ropes. First he looked at her eyes – they were as clear and bright as usual. Then he felt behind her ears – her temperature was normal. Next he listened to her heart that was fine too – and checked all over for cuts or sores. He could find nothing wrong with her. “Strange,” he thought. “I can find no explanation for her bad behaviour.”But then his eye was caught by something gleaming in the straw. It was a sharp, curved knife, like the ones used by robbers. Could there be a connection? That night, when everyone else had gone to bed, the chief minister returned to the elephant house. There, in the stall next to Mahaghiri’s, sat a band of robbers. “Tonight we’ll burgle the palace,” said the chief. “First, we’ll make a hole in the wall, then we’ll steal the treasure. “But what about the guards?” someone asked. “Don’t tell me you’re still afraid to kill! When will you learn to be a real robber?” From the shadows, the minister could see the elephant, her ears pinned back, listening to every hateful and violent word.”Just as I suspected,” thought the minister. Then he slipped out, bolted the door on the outside so the robbers could not escape, and went immediately to the king.”Your majesty,” he said, “I think I have found the cause of your elephant’s bad behaviour.” As soon as the king heard what the minister had to say, he sent for his guards and had the robbers arrested. “But what about the elephant? How can she be cured?’ he asked. “Well, your majesty, if Mahaghiri became dangerous through being.in the company of those wicked robbers, perhaps she could be cured by being in the company of good people.” “What a brilliant idea!” exclaimed the king. “Let us invite the friendliest, happiest and kindest people in the city to meet in the stall next to the elephant.” “Mahaghiri, the king’s most prized elephant, has been in bad company and has become violent and dangerous,” the minister told his friends. “Will you help her to become her old self again?””Of course,” they replied. “What do you want us to do?” “Just meet in the elephant house every day for the next week. Let her hear how kindly and thoughtfully you speak to each other, and how helpful you are.” So the minister’s friends met in the elephant house as planned. They talked together and enjoyed each other’s company. Sometimes they brought cakes and sweets to share; sometimes their children came and played happily in the straw. All the while, Mahaghiri watched and listened. Gradually, she became calmer. “I think it’s working,” said the minister. “Soon we’ll be able to remove the ropes.” Everyone felt a bit nervous when the day came for Mahaghiri to be untied. The king ordered everyone to wait outside as, very carefully, brave Rajinder began to undo the ropes around her ears and trunk. Next he removed the ropes holding her head. Finally, he loosened the thick chains holding her great feet. Everyone held their breath. What if she was still wild?Mahaghiri looked round shuffling her feet to stretch them. Then she slowly curled her trunk around her keeper’s waist and lifted him high into the air before placing him gently on her back. A great cheer went up. The king was delighted. “Let’s have a picnic to celebrate,” he announced. “Mahaghiri can come too.” What a great afternoon they all had! Mahaghiri bathed in the lake and gave the children rides. It seemed as though she had now become kinder, gentler and even more trustworthy than ever. But Rajinder never forgot what had happened and was always careful to set Mahaghiri a good example by being kind and friendly himself.As per the context of passage, what was the most prized possession of the king of Benaras ?
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MCQ-> Billie Holiday died a few weeks ago. I have been unable until now to write about her, but since she will survive many who receive longer obituaries, a short delay in one small appreciation will not harm her or us. When she died we — the musicians, critics, all who were ever transfixed by the most heart-rending voice of the past generation — grieved bitterly. There was no reason to. Few people pursed self-destruction more whole-heartedly than she, and when the pursuit was at an end, at the age of 44, she had turned herself into a physical and artistic wreck. Some of us tried gallantly to pretend otherwise, taking comfort in the occasional moments when she still sounded like a ravaged echo of her greatness. Others had not even the heart to see and listen any more. We preferred to stay home and, if old and lucky enough to own the incomparable records of her heyday from 1937 to 1946, many of which are not even available on British LP, to recreate those coarse-textured, sinuous, sensual and unbearable sad noises which gave her a sure corner of immortality. Her physical death called, if anything, for relief rather than sorrow. What sort of middle age would she have faced without the voice to earn money for her drinks and fixes, without the looks — and in her day she was hauntingly beautiful — to attract the men she needed, without business sense, without anything but the disinterested worship of ageing men who had heard and seen her in her glory?And yet, irrational though it is, our grief expressed Billie Holiday’s art, that of a woman for whom one must be sorry. The great blues singers, to whom she may be justly compared, played their game from strength. Lionesses, though often wounded or at bay (did not Bessie Smith call herself ‘a tiger, ready to jump’?), their tragic equivalents were Cleopatra and Phaedra; Holiday’s was an embittered Ophelia. She was the Puccini heroine among blues singers, or rather among jazz singers, for though she sang a cabaret version of the blues incomparably, her natural idiom was the pop song. Her unique achievement was to have twisted this into a genuine expression of the major passions by means of a total disregard of its sugary tunes, or indeed of any tune other than her own few delicately crying elongated notes, phrased like Bessie Smith or Louis Armstrong in sackcloth, sung in a thin, gritty, haunting voice whose natural mood was an unresigned and voluptuous welcome for the pains of love. Nobody has sung, or will sing, Bess’s songs from Porgy as she did. It was this combination of bitterness and physical submission, as of someone lying still while watching his legs being amputated, which gives such a blood-curdling quality to her Strange Fruit, the anti-lynching poem which she turned into an unforgettable art song. Suffering was her profession; but she did not accept it.Little need be said about her horrifying life, which she described with emotional, though hardly with factual, truth in her autobiography Lady Sings the Blues. After an adolescence in which self-respect was measured by a girl’s insistence on picking up the coins thrown to her by clients with her hands, she was plainly beyond help. She did not lack it, for she had the flair and scrupulous honesty of John Hammond to launch her, the best musicians of the 1930s to accompany her — notably Teddy Wilson, Frankie Newton and Lester Young — the boundless devotion of all serious connoisseurs, and much public success. It was too late to arrest a career of systematic embittered self-immolation. To be born with both beauty and selfrespect in the Negro ghetto of Baltimore in 1915 was too much of a handicap, even without rape at the age of 10 and drug-addiction in her teens. But, while she destroyed herself, she sang, unmelodious, profound and heartbreaking. It is impossible not to weep for her, or not to hate the world which made her what she was.Why will Billie Holiday survive many who receive longer obituaries?
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MCQ-> Read the following passage carefully and answer the given questions. Certain words/phrases have been given in bold to help you locate them while answering some of the questions. Virtual currencies are growing in popularity. While the collective value of virtual currencies is still a fraction of the total U.S. Dollars in circulation, the use of virtual currencies as a payment mechanism of transfer of value is gaining momentum. Additionally, the number of entities (issuers, exchangers and intermediaries, to name just a few) that engage in virtual currency transactions is increasing and these entities often need access to traditional banking services.Virtual currencies are digital representations of value that function as a medium of exchange, a unit of account and a store of value (buy now redeem later policy). In many cases, virtual currencies are “convertible” currencies; they are not legal lenders, but they have an equivalent value in real currency. Despite what seems to be a tremendous interest in virtual currencies their overall value is still extremely small relative to other payment mechanisms, such as cash, cheques and credit and debit cards. The virtual currency landscape includes many participants from the merchant that accepts the virtual currency, to the intermediary that exchanges the virtual currency on behalf of the merchant, to the exchange that actually converts the virtual currency to the real currency to the electronic wallet provider that holds the virtual currency on behalf of its owner. Accordingly, opportunities abound for community banks to provide services to entities engaged in virtual currency activities. Eventually, it is also possible that community banks may find themselves holding virtual currency on their own balance sheets.Launched in 2009, Silicon is currently the largest and most popular virtual currency. However, many other virtual currencies have emerged over the past few years, such as Litecoin, Dogecoin, Peercoin and these provide even more anonymity to its users than that provided by Bitcoin.As the virtual currency landscape is fraught with dangers, what important risks should community bankers consider?The most significant is compliance risk- a subset of legal risk. Specifically, virtual currency administrators or legal exchangers may present risks similar to other money transmitters, as well in presenting their own unique risks. Quite simply, many users of virtual currencies do so because of the perceptions that transactions conaucted using virtual currencies are anonymous. The less-than transparent nature of the transactions, :nay make it more difficult for a inancial institution to truly know and understand the activities of its customer and whether the customer’s activities are legal. Therefore, these transactions may present a higher risk for banks and require additional due diligence and monitoring.Another important risk for community banks to consider is credit risk. How should a community bank respond if a borrower wants to specifically post Bitcoin or another virtual currency as collateral for a loan? For many, virtual currencies are simply another form of cash, so it is not hard to analyse that bankers will face such a scenario at some point. In this case, caution is appropriate. Bankers should carefully weigh the pros and cons of extending any loan secured by Bitcoin or other virtual currencies (in whole or in part), or where the source of loan repayment is in some way dependent on the virtual currency. For one, the value of Bitcoin in particular has been volatile. Then, the collateral value could fluctuate widely from day-to-day. Bankers also need to think about control over the account. ‘How does the banker control access to a virtual wallet, and how can it control the borrower’s access to the virtual wallet? In the event of a loan default, the bank would need to take control of the virtual currency. This would require access to the borrower’s virtual wallet and private key. All of this suggests that the loan agreement needs to be carefully crafted and that additional steps need to be taken to ensure the bank has a perfected lift on the virtual currency.Virtual currencies bring with them, both opportunities and challenges, and they are likely here to stay. Although, it is too early to determine just how prevalent they will be in the coming years, we too expect that the virtual participants in the virtual currency ecosystem will increasingly intersect with the banking industry.Which of the following is the meaning of the phrase ‘fraught with dangers’ as mentioned in the passage?
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