QUESTIONS OF LAST YEAR

1.5 yr bond 10% coupon ytm 8% , if 1 yr price will be

1. increase, 2. decreae ,3.equal to 4. insufficient

2. co- variance correct

1.-1,2.+1, 3.= +/-04.0

3. incorrect:
1.std error of sample mean increase sample size
2.std error of sample mean decrease sample size
3.variability representation

4.in sample distribution how mean represented?

5. coupon int rs.1000/ maturity 5 yr, coupon rate 9% ytm ?
1.8,2.9,3.10,4.8.3

6.7% coupon bond , 1000 ytm 6.75 trading for 975 current yield
1.7,2.6.53,3.6.75,4.7.18

7.the ------ will earn the bond holds

1.current yield 11 dividend yield, ytm, p/e

8.a ------- is right to cah before maturity

1. coupon, 0 coupon

9. current yield of bone = ytm, when price is at

1. premium,discount, par.

10. statistics measure of the probability distribution ?

11. variabilitity arount mean?

12. std deviation expected return ?

13. co-efficient of variation?

14.correlation to co-efficient
0.1,-1 to 0, -1 to +1, 1

15.
mean 76, std deviation 8, 70-82 is

272,164,260,320

16. a bond will sell at a discount?

equation y= a-b x

1.a and b are +

2.a< b

17. y intercept b slope of line is1. -ve, 2.inverse both x and y

18.mean 65, std deviation 12 % below 50

1.11,2.89,3.15,4.18

19.central limit theorm

0 eff o x, 2y which is stable
y=a+bx if n =7, E7= 619, E x=0, E xy 1y1 Ex =28
b=?

a=?

2.67

66.27

5.04

85.55

3.45

88.43

5.75

74.27

20. investor should select pay back period

1.irr more2.irr less
3.npv less 4.pv lesss

21. 2nd method cr 1.33:1

1.25:1

min and max?

22.forex rate quoted at tod, tom, forward rate, spot?

23.bank to earn profit 1. forex swap, int futures, options, int rate swap

24. duration of t bills 91/more less

25.diff in time and initiation of con and settlement period

transaction, translation, operating

26.basis risk holds a and l with diff prin amts and m . dates
1. holds more assets and liabilities and 2.3.4etc

27. find int rate of diff as a and l change in magnitude

1. faces frequent int rate change in govt securities.

28. gap diff to magnitude

1. gap on near term, long term, med term, all
29.profitability is achieved primarily through
long term loans to short term assets.
short term loans to long term assets
3.maturity maching
4.price matching

30alm, liability means matching specific assets to liabilities

1.studying increase in alibilities
2.net income
3.total liabilities
4.adjust profit after taking price mechanism,

31.stylist linguist graph

1.gap in market conditions.

2.gap in bank specific conditions.

3.cumulative gap in general market conditions.
32. profit earned by a bank illiquid investment
1.profit on revaluation of investment
2.land and building sale
3.investment reserves.

33.nim?

34.sys risk result in 1.call risk2.fund risk3.time risk4.operation

35.risk ariisng for loing term assets by short time liabilities.

1.credit risk.2.int risk,3.liquid risk,4.operation risk

36.capital and RAROC are

1.both risk,2.no risk,3.not related.

37.uncertanities with int rates at which future cash flows are likely to be depreciated
1.int rate risk, liquid risk.

38.not present current future?

1.ERR, DR,basis risk, credit risk.

39.LIBOR Ex t-bill rate swap

1.coupon, basis swap 3.4.etc

40.bank matching its rate sensitive assets with respective liabilities

1.prudent,2.profitable,3.risk averse, 4.agressive.

41. valid option-reducing liabilites sen.gap

1.extent/reduce investment portfolio
increase long term/floating rate deposits.

42.PV of assets/liabilites-purpose
1.earnings perspective
2.economic value perspective
3.LGD
4.EAD

43.primary risk in selling assets beyond

1.embedded option risk,

2.price risk,
3.reinvestment risk,
strategic risk

44.which funding likely to runoff immediately in crisis?

1.ws deposit
2.govt dep
3.core deposit
4.inter bank

45.less liquid?
1.r.r. investment
2.loan portfolio
3.cb lending
4.investment in PTCS

46.decrease in MV of liability > than dec in market value of assets then,

EV of equity inc/dec
2.no effect.
3.stock prices comes down,

47.net profit 1,50,000/- depn 2000 int LTL 15000 ins 60000

dscr is 1.2.27
2.2
3.2.83
4.2.50

48.not a measure for calculate current market price.

1.PER
2.book value.
3.dividend yield.
4.return on investment/yield

49.ability of management to control costs?

1.gross profit ratio

2.operating income,

3.net income to sales.

4.operating exp ratio

50.PER - book value 140, earnings 20, divident 12 MP 18

1. 1.67:1
2. 7 :1
3. 9 :1
4. 45 :1

51. uSE OF funds

1.decrease in fixed assets.
2.decrease in receivables.

52.cash cover ratio?

53.Profitability measure_ Fixed asset turnover

54.ISDA?

55.FUND RISK RESULT- LR variation in a and l

adv variation of p an l

56.lower risk - lower variability in cash

lower upside and downward

57.banking book is exposed to

1.LR, IRR, CR
2.OP RISK
3.TRADING BOOK RISK OP RISK
4.DEFAULT RISK

58.no. of business line op risk basel ii std approach

59.embedded option
1.prepayment of loan
2.premature td
3.change in int
60.systemic risk
1. failiure of treasuryof comp operations, systems and during banking business
61.restriction of treasury mid office
1.independent op.risk monitoring

62. RBI does not permit public sector bank

interest rate swaps,forward currency

future equity 4.etc

63.derivatives?
64.least risky for dealer
least bpv
high bpv
65.duration - residual maturity, contravening period etc
66.sensitivity ratio?
67.exposure limit to protect
1.reputation risk
2.leal
3.funding
4.credit

68.back office response for

buying and selling
borrowing and lending

69.min and max commercial rate?

70.risk in over the counter products

liquid risk, counter party

71.closing stock, which is double

72.valuation of stock

cost prics, market price increase, decrease or =

73.current ration = 2.5, current liability =30000

networth ?

74. when the accounts are distinguished from entitiesm we are dealing with
going concern, cost dual entity ?

75. average crs 4000, total purchases 96000, crs velocity ration
24 mths,3,2

76.fixed cost 96000, variable cost 60% of sale

BE SALEs?

77.DSCR lease rentals 1.numerator

2.denominator

78. balance sheet capital 20, surplus20, TL 50

SHORT TERM LOAN 0, LONG TERM LIABILITIES 28
NWC?
90,140,12,62

79.UNITS CAN EARN PROFITS IF VOLUME OF SALE IS >, <, =

80.net income and cash flows most accurate?

81.curent market values- not relavent?

going concern concept, materialistic matter, realization

82.working capital facility borrower need not bring

1.export receivables
2.finished goods
3.adhoc limits

83.free reserve?

84.provision of taxation ? TL, CL

85. co.LONG PERIOD

operating cycle
turnover ratio
int coverage ratio

86.choose correct:
divident exp in p and l- direct exp
sales income
cash dividends

- reduce asset cash

partnership firm

- drawing is an expense

87.co ability to cover currently maturing obligation

quick ration

free cash flow

finished goods to working capital ratio
cash flow operating to CL

88.financial leverate is -ve when

1. return on total assets > rate of retun on stock is
2. return on tatal liabilities < stock to
3. credit

< debit assets

89.investor h eld for no of days?

3
90. not a short time liquidity?

quick ratio, cash flow,working capital operating income.

91.NWC 45000, co invests capincrease 18000

1. current ration will increase increase, decrease, remain the same,

92. co conerts short term loan payable to long term loan

1.current ratio will decrease.
2.acid test ration will decrease
3.nwc will inrease or decrease

93.exp in TL and EMI where no redrawal

limit sancion
DL
bal o/s
none
94.duration mv 100cr 5.5 yrs ytm 10% var 10days is2%
14 days 1 mths 90 days 1yr

95. pv basis m. duration .05 0.50 5 5.5

1.5000
2.50000
3.500
4.50000000

96.liquid risk
no buyers
no sellers
highly liquid

97.basel ii rwa

cr 517589341 market risk 233243579

tier i 66846635
tier ii 19382577

op risk bif 63395242

cap crar 11 , 10.59 12.91 10.38

98.total rwa crar 517589341 540913698 814228162 477518456

m reg cap in 73280535 42976661 46583041 65138253

tier i 8.21 2.38 10.59 10.38

99.min cap req of credit risk
73280535 41407147 46583041 65138253