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SIB Flashcards

1
Q

CLASSIFICATION OF
BANKS

A

2

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2
Q

RBI

A

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3
Q

FUNCTIONS OF RBI

A

4

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4
Q

What is written on ! rupee note

A

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5
Q

Who signs 1 rupee note

A

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6
Q

What is written on other notes and who signs it?

A

6

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7
Q

Scheduled banks

A

Those banks which have been included in the Second
Schedule of Reserve Bank of India Act, 1934.
 Conditions to be fulfilled ->
1. A total of Rs. 5 lakh in paid-up capital and reserves are
needed.
2. The bank must demonstrate to the central bank that its
operations do not jeopardize depositors’ interests.
3. The bank must be a company, not a single owner or
partnership company.

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8
Q

Foreign banks

A

Banks are established in foreign countries
and have branches in other countries.

American Express Bank, HSBC, Standard &
Chartered Bank,

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9
Q

Commercial bank and How they make profit??

A

Financial institution which accepts deposits
from the public and gives loans for the
purposes of consumption and investment
to make profit.

How they make profit??

They accept deposit at a lower rate and
lend at a higher rate .

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10
Q

Public sector bank

A

It is a type of bank that is nationalised, and the
government holds a significant stake.

Bank of Baroda, State Bank of India (SBI), Dena Bank, Corporation Bank, and Punjab National
Bank.

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11
Q

Private sector bank

A

It is a type of commercial banks where private
individuals and businesses own a majority of the share capital.

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12
Q

Scheduled public sector banks in
India as on June 19,2022

A

12

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13
Q

Scheduled private sector banks in
India as on June 9,2021

A

13

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14
Q

Bancassurance

A

Selling insurance products through banks .
 ICICI prudential
 SBI LIFE

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15
Q

Deposits

A

Fixed deposits (FD)- fixed amount for a fixed period
Savings deposits/ accounts- any amount at any time
Current deposits/accounts – ( over draft facility)
Recurring deposit (RD) – fixed amount at regular
intervals for a fixed term

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16
Q

Demat account

A

A demat account/ De materialization
account is an account to hold financial
securities (shares, bonds etc) in
electronic form.

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17
Q

Demat account

A

A demat account/ De materialization
account is an account to hold financial
securities (shares, bonds etc) in
electronic form.

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18
Q

Micro finance

A

Microfinance is a category of financial services
targeting individuals and small businesses who lack access to conventional banking and related services.

 Pioneered by the Nobel Prize winner
Muhammad Yunus

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19
Q

Cheques

A

A cheque, is a document that orders a bank to
pay a specific amount of money from a person’s
account to the person in whose name the cheque
has been issued.
 The person writing the cheque, known as the
drawer,
One who pays- drawee
To whom the amount is paid- payee

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20
Q

Cheques content

A

19

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21
Q

IFSC

A

IFSC stands for Indian Financial System Code. It is a 11-digit alpha-numeric code that uniquely identifies a bank

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22
Q

MICR

A

A technology used primarily to identify and process cheques.
 string of characters that appears at the bottom left of the
cheques.
(magnetic ink character recognition)
pg 21

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23
Q

Stale Cheques

A

A cheque which is presented before the bank
after 3 months from the date mentioned on it

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24
Q

Post dated cheq

A

Are those dated in such a form that they
can only be cashed in in the future.

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25
Q

Crossing of a cheque

A

A crossed cheque is any cheque that is crossed with two
parallel lines, either across the whole check or through
the top left-hand corner of the cheque.
 This double-line signifies that the check may only be
deposited directly into a bank account
 . Therefore, such cheques cannot be immediately cashed
by a bank or by any other credit institution.

pg 24

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26
Q

Demand draft (DD)

A

A DD is a cash instrument used by an
individual to make a transfer payment from
one bank account to another.

27
Q

Online banking or Internet
Banking

A

doing banking transactions with
the help of internet

28
Q

NEFT

A

 National Electronic Funds Transfer
 A payment system that enables electronic transfer of funds from one bank to another bank account.
 It is an online system for transferring funds from one financial institution to another within India usually the banks

MINIMUM 1 rupee
MAXIMUM LIMIT none

29
Q

RTGS

A

RTGS is a funds transfer system where money is moved from one bank to another in ‘real-time’, and on gross basis.
 2 LAKS TO ANY AMOUNT

30
Q

IMPS

A

Immediate Payment Service

Immediate Payment Service (IMPS) is an instant interbank electronic fund transfer service through mobile phones.

pg 31

31
Q

Card payment system

A

Card-based payments are made by using a
credit card or a debit card

32
Q

DEBIT CARD

A

Used to withdraw or use cash up to
the limit present investors bank a/c.(Your ATM CARD)

33
Q

 CREDIT CARD

A

Customer can withdraw/use more
than what is deposited in the account . Excess
withdrawal will be treated as a loan.

34
Q

NPA

A

NON PERFORMING ASSSET
 Any advance or loan that is overdue for more than 90
days.
 “An asset becomes non-performing when it ceases to
generate income for the bank,”

35
Q

Classification of NPAs

A
  1. Substandard assets: Assets which has remained NPA for a
    period less than or equal to 12 months.
  2. Doubtful assets: An asset would be classified as doubtful if
    it has remained in the substandard category for a period of 12
    months.
  3. Loss assets: irrecoverable assets
36
Q

REPO – RE Purchase Order

A

 In India, repo rate is the rate at which Reserve Bank of
India lends money to commercial banks in India if they
face a scarcity of funds.
 Reverse Repo rate is the rate at which the Reserve Bank
of India borrows funds from the commercial banks in
the country

37
Q

CRR

A

The percentage of cash required to be kept in reserves,
vis-a-vis a bank’s total deposits, is called the Cash
Reserve Ratio.

38
Q

SLR

A

Statutory Liquidity Ratio
 is a minimum percentage of deposits that a
commercial bank has to maintain in the form of liquid cash, gold or other securities.

39
Q

MSF

A

Marginal Standing Facility (MSF) Rate is the rate
at which RBI lends funds overnight to scheduled
banks, against government securitie

40
Q

Current rates

A

CRR 4.5%
SLR 18%
Standing Deposit Facility Rate: 6.25%
Policy Repo Rate6.50%
Marginal Standing Facility Rate: 6.75%
Bank Rate: 6.75%
Fixed Reverse Repo Rate: 3.35%
Rbi website
pg 41

41
Q

Why CRR and SLR?

A

To control inflation by controlling the liquidity of banks.

42
Q

Recent Acquisitions /mergers

A

Bank of Baroda acquired Vijaya Bank and Dena Bank;

Punjab National Bank acquired Oriental Bank of Commerce and United Bank of India.

Union Bank of India acquired Andhra Bank and Corporation Bank.

Syndicate Bank was merged with Canara Bank

Indian Bank merged Allahabad Bank with itself.

pg 42

43
Q

SWIFT

A

Society for Worldwide Interbank Financial
Telecommunication
a global network connecting banks to
communicate messages about activities like money
transfer safely and securely, using a code.

44
Q

ATM

A

Automated Teller Machine

45
Q

 CDM

A

Cash Deposit Machine

46
Q

CAMEL

A
  • is an international rating system used by regulatory
    banking authorities to rate financial institutions

Capital Adequacy, Asset Quality, Management, Earnings and
Liquidity

47
Q

NRI

A

Non Resident Indian

48
Q

NRE

A

Non Resident External a/c

49
Q

NRO

A

Non Resident ordinary a/c

50
Q

NRE v/s NRO

A

pg 45

51
Q

Pay day loan

A

A relatively small amount of money
lent at a high rate of interest on the
agreement that it will be repaid when
the borrower receives their next wages.

52
Q

Line of Credit

A

A line of credit is a flexible loan from a bank or
financial institution.
 Almost equal to credit card that offers you a limited
amount of funds—funds that you can use when, if, and
how you wish—
 It is an amount of money that you can access as needed
and then repay immediately or over a prespecified
period of time.

53
Q

Financial market

A

Financial markets facilitate the interaction between those who need capital with those who have capital to invest.

All the facilities to satisfy the financial requirements of
firms
 Financial market = money market + Capital market
 Money market  RBI
 Capital market SEBI
 Capital market = primary market + Secondary
Market(Stock Market)

54
Q

BSE- SENSEX

A

Sensex is the benchmark index of the BSE in India.
 It was launched on January 1, 1986 as a basket of 30
stocks representing the country’s largest, financiallysound companies listed on the BSE.
 The term ‘Sensex’ is a blend of words ‘Sensitive’ and
‘Index’ and was coined by stock market expert Deepak
Mohini.

55
Q

NSE

A

NIFTY indices are used as benchmarks for products traded on NSE.
 derivation from the mix of two words, i.e. “National
Stock Exchange” and “fifty”.
 It is an abbreviation of the National Stock Exchange
Fifty.
 It is a collection of top performing 50 equity stocks
that are actively trading in the index.

56
Q

Economics systems

A

 Capitalism
 Socialism
 Mixed economy

57
Q

Capitalism

A

An economic system in which private actors own and
control property in accord with their interests,
 demand and supply freely set prices in markets in a
way that can serve the best interests of society.
 The essential feature of capitalism is the motive to
make a profit.

53

58
Q

Socialist economy

A

55

59
Q

Mixed economy

A

56

60
Q

GDP =Gross Domestic Product

A

economic indicator that reflects the
monetary value of goods (from food
products to vehicles, machinery and
textiles) and services (such as health care,
education, etc.) produced in the country
over a certain period of time

61
Q

Per capita income

A

60

62
Q

FISCAL POLICY v/s ECONOMIC
POLICY

A

Fiscal policy refers to the use of government spending
and tax policies to influence economic conditions.
 Policies of central bank of the country to control
economic condition

63
Q

Inflation

A

Inflation is defined as the increase in the price
levels of goods and services in an economy

64
Q

Recession

A

 Recession is said to be a period of slowing
down of the economy indicated by negative
growth.

Recession is measured by the reduction in the Gross Domestic Product of a nation

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