INDIAN ECONOMY MOCK TEST – CHAPTER 20

A loan is considered NPA or stressed asset, if it has not been serviced for

Consider the following statements –

1. Senior debt has lower risk than subordinate debt.
2. Higher leverage ratio indicates a higher financial risk.

Which of the above statements is/are CORRECT ?

Which of the following is associated with reforms in Indian banking sector ?

Which of the following is NOT a recommendation of Narasimhan Committee on reforms in Indian banking sector ?

In the context of SARFAESI Act 2002, which of the following statements is/are INCORRECT ?

1. It does not apply to unsecured loans.
2. It does not apply where remaining debt is below 20 percent of the original principal.
3. It does not apply to cooperative banks.
4. It does not apply to regional rural banks.

In the context of SARFAESI Act, who among the following type of borrowers is considered as a wilful defaulter ?

1. One who has not paid the dues due to bankruptcy.
2. One who has diverted the funds for other use in the project than for the purpose sanctioned by the banks.
3. One who has siphoned the funds.

In the context of Insolvency and Bankruptcy code, consider the following statements –

1. The process can be initiated only after approval of National Company Law Tribunal (NCLT).
2. The decision to accept a resolution plan rests solely upon the Committee of Creditors (CoC).
3. All decisions of the Committee of Creditors (CoC) require simple majority.
4. The resolution process be completed within 180 days from the date of acceptance of resolution plan.

Which of the above is/are CORRECT ?

Insolvency and Bankruptcy Board of India was established in

In the context of Basel Committee on Banking Supervision (BCBS), consider the following statements –

1. It was founded in 1974.
2. It has 28 members.
3. India is not a member.

Which of the above is/are CORRECT ?

In the context of Basel Accords, which of the following statements is/are CORRECT ?

1. Basel I norms require international banks to maintain a minimum capital adequacy ratio of 9 percent.
2. Basel II norms require international banks to maintain countercyclical buffer.
3. Basel III norms require international banks to maintain minimum leverage ratio.
4. India adopted Basel norms in 1999.

Which of the above statements is/are CORRECT ?

Which of the following statements is/are CORRECT in the context of narrow banking ?

1. The banks are not allowed to grant loans.
2. The banks are allowed to buy government securities.

In the context of Capital Adequacy Ratio (CAR) requirements in India, consider the following statements –

1. Indian banks are required to maintain CAR of atleast 8 percent.
2. Indian banks are required to meet 2 percent of their CAR requirements through tier-1 capital.
3. Indian banks are required to maintain additional capital buffer of 2.5 percent of their risky assets.

Which of the above statements is/are CORRECT ?

In the context of twin balance sheet problem,  which of the following statements is/are TRUE ?

1. The borrower loses the capability to pay back loans.
2. The lender loses the capability to lend more loans.

Match the columns –

In the context of priority sector lending by banks in India, consider the following statements –

1. Private sector banks have outperformed public sector banks.
2. Foreign banks have outperformed their mandated targets.
3. All banks have met their sub-sectoral target in agriculture.

Which of the above statements is/are INCORRECT ?