BIBM Question Bank

Previous year questions (without GK, ClassifiCation, resChedulinG and ProvisioninG)
NKD
1 In executing the standing instructions, their exists a relationship between customer and bank (F-18, 16,
*** 17, G, C-16, E-17)
When the bank collects a MICR cheque for clearing, the relationship between the bank and that of the
customer is- (C-21)
In the matter of handling bill of exchange for collecting the relationship between customer and the bank
is- (F-19, 20)
In case of collecting a MICR cheque the relation between bank and customer is (C-15, 18)
a Debtor and creditor b Trustee and beneficiary
c Bailee and bailor d Agent and principal
Note: When a banker undertakes agency service such as collection of cheque, drafts and bills,
collection of interests and dividends on securities payment of premium and subscriptions, purchase and
sale of securities, etc., for a customer, he becomes the agent and the customer becomes the principal.
2 When a banks lend money the relation between Banker and Customer is- (C-21)
***
Debtor-Creditor Agent-Principal
Bailor-Bailee Creditor-Debtor
Note: When banker accepts deposits from the customer then bank becomes the debtor and the
customer is the creditor. If customer takes loans from bank then the customer becomes debtor and
banks becomes creditor.
3 When a Locker is given to a customer on hire, what relationship is established between the banker and
*** the customer?
In case of having a safe deposit locker by the customer the relation between bank and customer is-(C-
17)
What is the relationship between a bank and customer when a locker is rented out by a bank to a person
:
Bailer and Bailee Agent and Principal
Lessor and lessee Debitor and Creditor
Note: when a customer hires a safe deposit locker from the bank, the relation between the bank and the
customer is lessor and lessee. The bank is the lessor (licensor) and the hirer of safe deposit locker is the
lessee (licensee/tenant).
Note-1. Debtor and creditor relationship:- When banker accepts deposits from the customer then bank
becomes the debtor and the customer is the creditor. If customer takes loans from bank then the
customer becomes debtor and banks becomes creditor.
Note-2. mortgagor (pledger) and mortgagee (pledgee) relationship:– when customer pledges
(promises) certain assets or security with the bank in order to get a loan. In this case, the customer
becomes the Pledger, and the bank becomes the Pledgee. Under this agreement, the assets or security
will remain with the bank until a customer repays the loan. The relationship between banker and
customer may be mortgagee (pledgee) and mortgagor (pledger) when customer pledge any valuable
assets as security to take loan.
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Note-3. Licensor ( Lessor ) and Licensee ( Lessee) relationship:- The relationship between banker and
customer can be that of a Licensor and Licensee. This happens when the banker gives a sale deposit
locker to the customer. So, the banker will become the Licensor, and the customer will become the
Licensee.
Note-4. Relationship of Trustee and Beneficiary:- A banker becomes the trustee of his customer, when
he is entrusted with some trust for instance, when a customer deposits a certain sum of money with
banker with specific instructions to use the same for a specific purpose, the banker becomes the trustee
of the customer in respect of that money until that purpose is fulfilled.
When a cheque or a bill of exchange is deposited with a bank for collection, the bank becomes a trustee
for the cheque or bill till it is collected. Of course once the cheque is collected and the proceeds are
credited to the customer’s account the banker becomes the debtor.
When banker is appointed as trustee for the customer’s property he becomes a trustee of the customer
and he owes some duties.
i. He is required to deal with the trust money or property in accordance with the terms of the trust deed.
ii. He is required to give a detailed account of the trust property to the beneficiary.
iii. He should be banded to hand over the profits earned from the use of the trust property to the
beneficiary who is entitled to the benefits of the trust property.
Note-5. Relationship of Bailor and Bailee:- When a banker accepts valuable and documents from a
customer for safe custody, he becomes a bailee and the customer become a bailor. The relationship
between banker and customer can be that of Bailor and Bailee. Bailment is a contract for delivering
goods by one party to another to be held in trust for a specific period and returned when the purpose is
ended. Bailor is the party that delivers property to another. Bailee is the party to whom the property is
delivered. So, when a customer gives a sealed box to the bank for safe keeping, the customer became
the bailor, and the bank became the bailee. As a bailee, the banker owes some duties and liabilities to
the customer. They are:
i. He is required to safeguard the safe-custody deposits of the customer in his hands with reasonable
care.
ii. If he fails to take reasonable care in the preservation of the safe-custody deposits, and the customer
suffers a losses a consequence, so banker will be liable to compensate the customer.
iii. He is required to hand over the safe-custody deposit to the depositor whenever he demands them
back.
Note-6. Relationship of Advisor and Client:- When a customer invests in securities, the banker acts as
an advisor. The advice can be given officially or unofficially. While giving advice the banker has to take
maximum care and caution. Here, the banker is an Advisor, and the customer is a Client.
Note-7. Relationship of Agent and Principal:- When a banker undertakes agency service such as
collection of cheque, drafts and bills, dividend warrants, pays insurance premium, collection of interests
and dividends on securities payment of premium and subscriptions, purchase and sale of securities, etc.,
for a customer, he becomes the agent and the customer becomes the principal.
As an agent, the banker owes some duties to the customer. They are:
i. He is required to act in accordance with the instructions of the principal i.e. the customer.
ii. He is bound to return to the customer all the incomes which he earns as an agent of the customer.
Note-8. Guarantor and Guarantee relationship: At the time of international trade importer needs
guarantee to receive goods from the exporter. Here bank gives guaranteeto its customer i.e. bank issue
“letter of credit” to exporter by stating strength of importer financial position.
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4 The banker has a statutory obligation to: (E-19, 18, 17, 16, C-21, 17, 16, G, AR)
***
a Honor customer's cheque b Maintain secrecy of his customer's account
c Illegal Banking d Money Laundering
Note-1: Under Section 31 of NI Act 1881 the drawee of a cheque having sufficient funds of the drawer in
his hands properly applicable to the payment of such cheque must pay the cheque when duly required
so to do, and, in default of such payment, must compensate the drawer for any loss or damage caused
by such default.
Note-2: When a current account is opened by a banker in the name of a customer there is an obligation
on the banker to honour the customer’s cheque as long as there are sufficient funds available in the
customer’s account for meeting the cheques.
Note: Special Relationship: 1. Statutory obligation to honor cheque. 2. Maintain secrecy of customer
account. 3. Bankers Lien. 4. Right to claim incidental charges.
5 The rate of interest payable on various deposits is determined by the: (E-16, G)

*** a Head Office of each Bank b Bank and Financial Institutions
depositunder Ministryof finance
c Association of Banker’s Bangladesh d Bangladesh Bank

6 The best suited deposit for a trading community is- (E-17, C-16, G)
***
The best suited deposit for a trading company is- (E-16, C-21, 17, 15)
Which of the following deposit is not suited for a non- trading community? (C-18, 17)
a Savings deposit b Fixed deposit
c Current deposit d Recurring deposit
7 As per the nature of the deposit, savings deposit is- (C-18)
***
Time deposit Demand deposit
Both (a) and (b) None of the above
What Is a Demand Deposit: A demand deposit account (DDA) is a bank account from which deposited
funds can be withdrawn at any time, without advance notice. DDA accounts can pay interest on the
deposited funds but aren’t required to. Checking accounts and savings accounts are common types of
DDAs.
8 Which of the following types of bank account may not be classified as dormant (E-19, F-18)
***
a Corporate account b Accounts of Illiterate person
c Accounts of Minor d Joint Account
Note: Inoperative Account: CD/SND/SB: 6 months from last transaction. Dormant Account: CD/SND:
6+6= 12 months, SB: 6+18= 24 months.
9 To maintain secrecy of account of a customer is- (C-21)
***
General obligation of the banker Contractual obligation of the banker
Statutory obligation of the banker All of the above
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10 The most undesirable customer is -(E-16, G)
***
a A Minor b A married woman
c An unregistered firm d An undischarged bankrupt
Note: someone who is legally bankrupt but who still has to pay back particular debts and cannot borrow
again without telling financial organizations considering a loan that they are bankrupt.
11 A customer's letter of instructions without any stamp, in Connection with the operations of his account
*** is known as...... - (E-19, 16, 17, 19, G, C-15, 18)
a Power of attorney b Standing instructions

c Probate d Mandate
Mandates: Account mandates say who can use an account, and how. This is especially important if you
let someone else operate the account. An account mandate is a document that sets out: who owns an
account (often called the account holder or account owner).
What Is Probate: Probate is the entire process of administering a dead person’s estate. This involves
organising their money, assets and possessions and distributing them as inheritance – after paying any
taxes and debts. If the deceased has left a Will, it will name someone that they’ve chosen to administer
their estate. This person is known as the executor of the Will.
12 Which one of the following is not true as regards opening and operation of an account in the name of an
*** illiterate person? (C-21)
Thumb impression should be obtained on the Accounts of illiterate persons to be opened
AOF & SS card on proper introduction
Account holder should physically visit bank Bearer cheque is accepted in this account
branch to withdraw deposit to make payment.
13 Can illiterate person be issued debit card (C-18, 17)

*** no Yes
only in case of joint account only in case he is he head of family
14 Who can open bank account (C-17)
*** a Bangladeshi Citizen b Illiterate Person
c All of these d Non Rrsident Bangladeshi
Special Types of Banker’s Customers: 1. Minor. 2. Illiterate. 3. Lunatic. 4. Married woman. 5.
Purdanashin Woman. 6. Joint account. 7. Joint Hindu Family. 8. Trust account. 9. Clubs, Societies and
Charitable Institutions. 10. Partnership Firm and 11. Joint Stock Companies. 12. Drunkard.
15 An instrument containing an unconditional order, signed by the maker, directing a person to pay a
*** certain sum of money only to the order of a certain person or the bearer is called (E-20, F-19)
Promissory note Bills of exchange
Cheque Demand draft
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Note: A “bill of exchange” is an instrument in writing containing an unconditional order, signed by the
maker, directing a certain person to pay on demand or at fixed or determinable future time a certain
sum of money only to, or to the order of, a certain person or to the bearer of the instrument.
16 Which one of the following is a Negotiable Instrument (C-21)
*** Prize bond Promissory note
FDR Shares
Note: Section 13: “Negotiable instrument”: A “negotiable instrument” means a promissory note, bill of
exchange or cheque payable either to order or to bearer.
17 The document drawn by a debtor on the creditor agreeing to pay a certain sum is called.... (EO-19, 16,
*** 17, 18, C-18, G)
a Cheque b Promissory Note
c Bill of exchange d Draft
Note: Section 4: “Promissory note”: A “promissory note” is an instrument in writing (not being a bank-
note or a currency-note) containing an unconditional undertaking, signed by the maker, to pay on
demand or at a fixed or determinable future time a certain sum of money only to, or to the order of, a
certain person, or to the bearer of the instrument.
18 Section 131 of Negotiable Instrument Act 1881 extends protection to the- (C-17)
***
Paying banker Payee of the cheque
Collecting banker Drawer of the cheque
Note: Under this Section, a collecting bank has protection only if the collecting bank, in good faith and
without negligence, receives payment of the customer by a cheque, i.e. if there is negligence in receiving
of a cheque on behalf of the customer, the collecting bank would be liable for negligence.
19 Which banker gets protection under section 85 of Negotiable Instrument Act, 1881 (F-17, 16)
*** a Collecting Banker b Paying Banker
c Drawer of the cheque d Both (a) & (b)
Note: The section 85(1), 85(2), 128 of negotiable instrument acts provide statutory protection to paying
banker for making payments of order cheque, bearer cheque or crossed cheque in that order.
20 Mr Himel issued a cheque in favor of Dhaka Public School as tuition fee for his son. Here, Dhaka Public
*** School is – (E-14)
Holder Holder in due course
Both None
21 Cheque is defined in Sec…..of NI Act 1881. (2015)
***
a SEC 4 b SEC 5
c SEC 6 d SEC 8
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Note: Section 4: “Promissory note”, Section 5: “Bill of exchange”, Section 6: “Cheque”, Section 7:
“Drawer” “Drawee” “Drawee in case of need” “Acceptor” “Acceptor for honour” “Payee”, Section 8:
“Holder”, Section 9: “Holder in due course”, Section 10: “Payment in due course” Section 13:
“Negotiable instrument”, Section 15: "Indorsement".
22 Negotiable instrument means a promissory note, bill of exchange or chaque payble to- (E-18)
***
a Bearer b Order
c Either to bearer or order d Neither bearer nor order
Note: 13.(1) A “negotiable instrument” means a promissory note, bill of exchange or cheque payable
either to order or to bearer.
23 “Payment in accordance with the apparent tenor of the instrument in good faith and without negligence
*** to any person in possession there off” (F-17)
Holder in due course Payment in due course
Holder None one
Sec. 10 of NI Act 1881: “Payment in due course” means payment in accordance with the apparent tenor
of the instrument in good faith and without negligence to any person in possession thereof under
circumstances which do not afford a reasonable ground for believing that he is not entitled to receive
payment of the amount therein mentioned.
24 Statutory protection under sec-85 of NI Act 1881 to a paying bank: (F-17)
***
a Bank has paid an order cheque b Bearer cheque
c Cheque (it) has been paid in due course d (A) & ( C )
Note: Cheque payable to order: 85.(1) Where a cheque payable to order purports to be indorsed by or
on behalf of the payee, the drawee is discharged by payment in due course.
(2) Where a cheque is originally expressed to be payable to bearer, the drawee is discharged by payment
in due course to the bearer thereof, notwithstanding any indorsement whether in full or in blank
appearing thereon, and notwithstanding that any such indorsement purports to restrict or exclude
further negotiation.
25 The most important feature of a negotiable instrument is: (C-18, G)
*** a Free transfer b Transfer free from defects
c Right to sue d (a) and (b) together
Features of a Negotiable Instrument: 1. Free Transfer. 2. Transfer free from defects. 3. Right to Sue. 4.
No notice to transfer. 5. Presumptions as to negotiable instruments. 6. Credit of the party.
26 Where the signature of a cheque is not genuine, such a cheque is called- (E-19, 18, C-16, 18)
***
a Invalid cheque b Forged cheque
c Suspicious cheque d Both (a) & (b)
27 Forged cheque is…….. Cheque (C-17)
***
Valid Stale
Invalid Ante-dated
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28 A written order signed by a bank customer, directing the bank to pay a specified sent of money to
*** designated recipient is called. (FAVP-2018, C-16, 17, 18)
Bill of Exchange Demand Draft
Cheque Promissory note
29 A written instruction is given by a bank customer to the bank to pay on demand a certain sum of money
*** to a certain person is called- (F-17)
Promissory note Bill of Exchange
Cheque Banks Pay Order (PO)
30 The documents which can be used only for making local payment is - (F-16, 17, G)
*** a A Cheque b A Bill of exchange
c A Bankers Cheque/ A Payment Order d A demand draft
31 Which one of the following is not a negotiable instrument? (C-21, 16)
*** Demand Draft Promissory note
Cheque Payment order (C-21)/ FDR (C-16)
32 For clearing a MICR (Magnetic Ink Character Recognition) chque bank should put- (E-16)
*** For clearing a cheque on behalf of customer bank should put (AR)
a General crossing b Special crossing
c Either (a) or (b) d None of the above
Note: Magnetic Ink Character Recognition (MICR) Line. Magnetic ink character recognition (MICR) is the
information that appears at the bottom of a check. This includes the bank's routing number, the
customer's account number, and the check number.
33 Mutilated notes- (C-17)
*** Should be burnt away Should be thrown away
Can be exchanged at Bank None of above
34 Unless revalidated normally a cheque would be treated as a stale one if it exceeds more than- (C-16)
*** 1 year 9 months
6 moths 3 months
Stale Cheque: If a cheque is presented for payment after 06 (Six) months from the date of the cheque, it
is called stale cheque. This type of cheque cannot be honored by the bank. After expiry of that period,
no payment will be made by banks against that cheque.
35 Where a customer has issued a cheque date of which is yet to come, such a cheque is called- (C-16)
***
The date mentioned on a cheque which is yet to come is called- (C-21)
Ante-dated cheque Post-dated cheque
Stale cheque None of the above
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36 Where a customer has issued a cheque date of which has already elapsed but it has not become state as
*** yet, such a cheque is called- (C-16)
A customer has issued a cheque where the date of which is already passed Such cheque is called-(EO-17,
16)
a Stale Cheque b Post-dated cheque
c Crossed cheque d Ante dated cheque
1. Uncrossed or open cheque: A cheque is called ‘Open’ when it is possible to get cash over the counter
at the bank. The holder of an open cheque can do the following:
• Receive its payment over the counter at the bank,
• Deposit the cheque in his own account
• Pass it to some one else by signing on the back of a cheque.
2. Crossed cheque: Since open cheque is subject to risk of theft, it is dangerous to issue such cheques.
This risk can be avoided by issuing another types of cheque called ‘Crossed cheque’. The payment of
such cheque is not made over the counter at the bank. It is only credited to the bank account of the
payee. A cheque can be crossed by drawing two transverse parallel lines across the cheque, with or
without the writing ‘Account payee’ or ‘Not Negotiable’.
3. Bearer cheque: A cheque which is payable to any person who presents it for payment at the bank
counter is called ‘Bearer cheque’. A bearer cheque can be transferred by mere delivery and requires no
endorsement.
4. Order cheque: An order cheque is one which is payable to a particular person. In such a cheque the
word ‘bearer’ may be cut out or cancelled and the word ‘order’ may be written. The payee can transfer
an order cheque to someone else by signing his or her name on the back of it.
5. Post Dated Cheque: A cheque which bears of future date is called a post dated cheque. Cheque on
which drawer mentions a date which is subsequent to the date on which it is presented, is called post-
dated cheque. For example, if a cheque presented on 8th May 2003 bears a date of 25th May 2003, it is
a post-dated cheque. The bank will make payment only on or after 25th May 2003.
6. Ante dated cheque: The date of a cheque which has already surpassed but it has not become stale as
yet. Cheque in which the drawer mentions the date earlier to the date of presenting if for payment. For
example, a cheque issued on 20th May 2003 may bear a date 5th May 2003.
7. Stale Cheque: It is the practice in our country not to honour cheques presents for payment after the
expiry of six calendar months from their dated. Such cheques are considered "stale" or "out of date". A
cheque which is issued today must be presented before at bank for payment within a stipulated period.
After expiry of that period, no payment will be made and it is then called stale cheque’
8. Mutilated Cheque: In case a cheque is torn into two or more pieces and presented for payment , such
a cheque is called a mutilated cheque. The bank will not make payment against such a chequewithout
getting confirmation of the drawer. But if a cheque is torn at the corners and no materialfact is erased or
cancelled, the bank may make payment against such a cheque.
9. Undated Cheque: Undated cheques are not honoured in practice since the drawee bank would be
unable to know if it is stale.
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37 Stop payment instruction of a cheque can be given by: (E-18, 16, 17, F-16, 17, C-21, 18, 16, AR)
***
Payment of Cheque can be stopped by- (C-17)
Crossing of cheque can be cancelled by (C-17, 21, E-14)
Cancellation of crossed cheque can be done only. (F-16)
a Any payee of the cheque b Any endorser of the cheque
c Only drawer of the cheque d All of the above
38 “If the amount of a cross cheque had been paid by a bank to and received by the true owner there
*** off,” means - (F-17)
Payment in due course of crossed cheque The bank must verify the regularity of
endorsement
39 Crossing of the cheque can be cancelled by –(E-14)
*** Drawer only along with his initial Drawer only along with his full signature
Payee of the cheque Holder in due course
40 Crossing a cheque without the knowledge of the drawer is a case of-- (EO-19, G, C-16, 17)
*** a Material alteration b Authorized alteration
c Immaterial alteration d A & C together
41 The following one is not a material alteration- (E-20, F-18, G)
*** Alteration of crossing Alteration of place of payment
Conversion of blank endorsement into full Alteration of the payee’s name
endorsement
42 The paying banker can get protection for a materially altered cheque provided (E-19, 16, 17, 19, F-16,
*** G, F-17, C-16, 18)
a The alteration is not apparent b Banks makes payment in due course
c The alteration is immateria d Both (a) and (b)
43 The material parts (material alteration) which include except one of the following - (F-17)
*** Crossing and cutting of the word “bearer” in a Changing/altering date
cheque
Changing the sum payable Changing crossing/cancellation of crossing
Changing the time of payment Changing the place of payment
Examples of meterial alteration: 1. Alteration of date, 2. Alteration of place of payment, 3.
Alteration of crossing, 4. Altreation of the words "or order" or "or bearer", 5. Alteration of the
amount, 6. Alteration of payee, 7. Alteration by an outsider.
44 Two parallel transverse lines across the cheque is called- (C-17)
***
Endorsement Crossing
Assignment Transfer
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45 Which one of the following crossing is not a general crossing? (C-21)
***
Crossing with bank name "Account Payee" crossing
"Not negotiable" crossing "Not transferable" crossing
46 The following one is absolutely essential for a special crossing (C-16, 17, G)
***
a Two parallel transverse lines b Words ‘And Company’
c Words ‘Not Negotiable’ d Name of a banker/Name of a bank
47 A cheque which is not crossed is called: (C-16, G)
***
A cheque without crossing is called: (E-16)
a Uncrossed cheque b Open cheque
c Order cheque d Bearer cheque
48 An order cheque can be converted into a bearer cheque by means of (C-21, G)
***
a Sans recourse endorsement b Special endorsement
c Blank endorsement (Sec 16/1, NI Act 1881) d Sans Frais endorsement
What Is a Blank Endorsement: A blank endorsement is a signature on a financial instrument such as
a check. No payee is specified, so any holder of the instrument could claim payment. The signature
essentially turns the instrument into a bearer security. That is, it is not registered to any individual
but is payable to the person who possesses it.
49 In a limited company certificate of incorporation was obtained through a memorandum which was
*** signed by two persons for all the seven signatories. The signatures were forged. Will the bank accept
memo as genuine for opening bank account? (F-20)
Yes, because incorporation certificate is valid. No, because forged documents cannot be
accepted.
Bank will ask its head office. It is at the discretion of the bank.
50 Garnishee order is issued by (EO-17, C-16)
*** Order Nisi and Order Absolute are issued by (F-18, C-15, 16, 18, 21)
a Policy orde b National Board of Revenue
c Court of Law (The order is issued under the d C.I.D
civil procedure code on the banker)
What is order nisi and order absolute: A Garnishee Order is issued in two stages, first as an Order
Nisi and then an Order Absolute. 1. On receipt of Order Nisi, Bank is bound to stop operation of the
account. ... After receipt of the explanation of Bank ,Court may issue Order Absolute. On receipt of
an “Order absolute”,Bank has to pay the amount to the court.
51 When Garnishee order is issued by the court attaching the account of a customer, the banker is
*** called- (E-19, F-16, 20, G)
a Judgement debtor b Garnishee
c Judgement creditor d Garnishor
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52 When Garnishee order is issued by the court attaching the account of a customer, the customer is
*** called (FAVP-2018)
judgement debtor Garnishee
judgement creditor Garnishor
Note: The creditor at whose request the order is issued is called the judgement- creditor, the debtor
whose money is frozen is called judgement- debtor and the banker who is the debtor of the
judgement debtor is called the Garnishee. The Garnishee Order is issued in two parts.
53 To get statutory protection, the paying banker must make (E-20, G)
***
a Payment to a holder b Payment to a holder in due course
c Payment in due course d Payment to a drawee in case of need
54 The effect of general crossing is that it gives a direction to the- (EO-20, 19, 16, 19, F-16, 18, 17, C-16,
*** 18)
a Collecting banker b Paying Banker
c Holder d (a) and (c) together.
Significance of General Crossing:
i. The effect of general crossing is that it gives a direction to the paying banker.
ii. The direction is that, the paying banker should not pay the cheque at the counter. It should be
paid only to a fellow banker. In other words, payment is made through an account and not at the
counter. Sec.126 of the NI Act clearly lays down that, “Where a cheque is crossed generally, the
banker on whom it is drawn, shall not pay it otherwise than to a banker”.
iii. If a crossed cheque is paid at the counter in contravention of the crossing:
55 A collecting banker is given protection only when he collects (C-21, G)
*** In case of collection of cheques, the collecting banker gets statutory protection for only: (G)
a A crossed cheque b An order cheque
c A bearer cheque d A mutilated cheque
56 A collecting banker is given the statutory protection only when he acts as- -E-20, 19, F-16, G, C-17,
*** 18)
a A holder for value b A holder of MICR cheque
c An agent d A holder in due course
Note: Section 131 gives statutory protection to the collecting banker only when he acts as “agent for
collection” and not as a “holder for value”. As an agent, the collecting banker credits the account of
the customer, only after realisation of the cheque. In such case only, he can avail the protection
under 131, provided he acted in good faith and without negligence.
Holder for value: When a collecting banker, advances some amount to his customer, before
realization of his cheque, the banker becomes owner of the cheque now and he is termed as “Holder
for value”
57 Which bank acts only as an agent of the customer? (F-17)
*** Collecting Bank Both
Paying Bank
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58 A banker who collects a cheque for and on behalf of his customer is- (C-21)
***
Collecting banker Advising banker
Paying banker Confirming banker
59 A collecting Banker gets protection for collection of cheques under Section 131 of the N.I. Act if the
*** collecting Banker can satisfy the following conditions: (TQ, AR, C-17)
a The cheque is CROSSED, collected for a b The cheque is CROSSED, collected for a
CUSTOMER, in GOOD FAITH & WITHOUT STRANGER & in GOOD FAITH
NEGLIGENCE
c d
60 Right to combine two accounts having same status by bank is called- (C-16, G)
*** Garnishee General line
Set-off Attachment order
61 The right to set-off is nothing but a ......(G, C-16)
*** a Right to sell b Right to retain
c Right to combine d Right to appropriate
62 WHICH ONE OF THE FOLLOWING IS A RIGHT OF THE BANKER? (2015)
*** a ASSSIGNMENT b LIEN
c SET-OFF d MORTGAGE
The rights of bankers are: 1. Rights of general lien. 2. Rights of the set-off. 3. Rights of
appropriation. 4. Rights to Charge Interest and Commission. 5. Rights to Close the Account
63 Which one the following is not a method of money laundering? (C-21)

***
Hundi Tax evasion
Purchase and sale of luxury items Transferring money abroad
64 Money laundering refers to- (C-16)
*** Properties acquired directly or indirectly To make dirty money appear to be clean
through illegal means
Illegal transfer, conversion & concealment of All of these
the location & earned through legal or illegal
means
65 Money laundering refers to (EO-2017)
*** a Concealing or disguising the illicit nature, b Assisting any person involved in the
source, location, ownership or control of the commission of the predicate offence to
proceeds of crime evade the legal consequences of such
offence
c Smuggling money or property earned through d All of these
legal or illegal means to a foreign country
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66 Which one of the following terms is used to describe the process of sending money through multiple
*** financial institutions to make it difficult to track? (C-21)
Integration Placement
Camouflage Layering
67 Layering under money laundering refers to (E-16, C-16, 17)
***
a Disguising the origin of the initial deposit b Disgusting the origin of the initial deposit
through multiple transfers through multiple transections
c (a) and (b) d None of the above
68 Which one the following stages are the process of Money Laundering? (C-21)
***
The process of money laundering contains following stages (C-15, 18)
integration , placement and layering Layering integration and placement
Placement-layering-Integration/Extraction None of the above
Placement - the physical disposal of the initial proceeds derived from illegal activity. [Cash paid into
bank (sometimes with staff complicity or mixed with proceeds of legitimate business). Cash
exported. Cash used to buy high value goods, property or business assets. Cash purchase of single
premium life insurance or other investment.]
Layering - separating illicit proceeds from their source by creating complex layers of financial
transactions designed to disguise the audit trail and provide anonymity. [Sale or switch to other
forms of investment. Money transferred to assets of legitimate financial institutions. Telegraphic
transfers (often using fictitious names or funds disguised as proceeds of legitimate business). Cash
deposited in outstation branches and even overseas banking system. Resale of goods/assets.]
Integration - the provision of apparent legitimacy to wealth derived criminally. If the layering
process has succeeded, integration schemes place the laundered proceeds back into the economy in
such a way that they re-enter the financial system appearing as normal business funds. [Redemption
of contract or switch to other forms of investment. False loan repayments or forged invoices used as
cover for laundered money. Complex web of transfers (both domestic and international) makes
tracing original source of funds virtually impossible.]
69 As regards Prevention of Money laundering which of the following is not true? (FAVP-2018)
*** KYC Policy is developed globally to prevent Enhanced Due Diligence is done for higher
identity theft, financial fraud etc. risk customers.
BAMELCO is responsible for reporting STR to CTR is to be made for Tk. 10 lac and above.
the BFIU.
70 BFIU stands for- (C-21)
*** Bangladesh Financial Intelligence Unit Banking Financial Institutions Unit
Bangladesh Finance and Infrastructure Unit Banking Finance and Industrial Unit
71 BFIU (Bangladesh Financial Intelligence Unit) was established in bangladesh in the year (E-19)
*** a 2002 (June) b 2012
c 2009 d 2013
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BFIU (Bangladesh Financial Intelligence Unit): Bangladesh Financial Intelligence Unit (BFIU) is the
central agency of Bangladesh responsible for analyzing Suspicious Transaction Reports (STRs), Cash
Transaction Reports (CTRs) & information related to money laundering (ML) /financing of terrorism
(TF) received from reporting agencies & other sources and disseminating information/ intelligence
thereon to relevant law enforcement agencies. BFIU has been entrusted with the responsibility of
exchanging information related to money laundering and terrorist financing with its foreign
counterparts. The main objective of the BFIU is to establish an effective system for prevention of
money laundering, combating financing of terrorism and proliferation of weapons of mass
destruction.
BFIU was established in June 2002, in Bangladesh Bank (Central bank of Bangladesh) named as 'Anti
Money Laundering Department'. To enforce and ensure the operational independence of FIU, Anti
Money Laundering Department has been transformed as the Bangladesh Financial Intelligence Unit
(BFIU) in 25 January, 2012 under the provision of Money Laundering Prevention Act, 2012 and has
been bestowed with operational independence. BFIU has also achieved the membership of Egmont
Group in July, 2013.
Legal Framework: BFIU works under the provisions of Money Laundering Prevention Act, 2012 and
Anti-Terrorism Act, 2009 (including amendments in 2013).
Overview of Bangladesh Financial Intelligence Unit: Bangladesh Financial Intelligence Unit (BFIU) is
the central agency of Bangladesh responsible for analyzing Suspicious Transaction Reports (STRs),
Cash Transaction Reports (CTRs) & information related to money laundering (ML) /financing of
terrorism (TF) received from reporting agencies & other sources and disseminating
information/intelligence thereon to relevant law enforcement agencies. BFIU has been entrusted
with the responsibility of exchanging information related to money laundering and terrorist financing
with its foreign counterparts. The main objective of the BFIU is to establish an effective system for
prevention of money laundering, combating financing of terrorism and proliferation of weapons of
mass destruction.
72 Prevention of money Laundering may be ensured through- (EO-2018)
***
a FATF (Financial Action Task Force) b Basel Principles
c Compliance with laws & regulations d All of These
73 The implementation of KYC in banks primarily addresses which of the following risks? (EO-2018)
***
a Reputation risk b Legal risk
c Money laundering risk d Market risk
74 Penalties and imprisonment for Money Laundering in case of divulging information is-(F-19, 20)
*** a A fine not exceeding BDT 10.00 lac thousand b A fine equivalent to the value of the
and imprisonment not exceeding 3 years property and imprisonment not exceeding
2 years
c A fine not exceeding BDT 25 thousand and d None of these
imprisonment not exceeding 1 year
75 How many standards are provided by the FATF for AML & CFT/FATF new standard has? (EO-17)
***
a 35 b 40
c 38 d 42
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Note: Financial Action Task Force (FATF), the international standard setter for AML/CFT,
has introduced 40+9 recommendations aiming to money laundering (ML) and financing of terrorism
(TF), which applicable to all countries around the globe. Afterwards, in 2012 FATF has revised its
40+9 recommendations and introduced a new set of 40 recommendations by merging them.
76 How long a bank branch is required to preserve the information of a closed account?(E-17, 16, C-16)
*** a 1 Year b 5 Years
c 2 Years d 10 Years
77 While opening an account of a partnership firm, which of the following is essential (E-16)
*** a Verification of partnership deed and b Registration Certificate of partnership
partnership letter
c Registration Certificate from Co-Operative Sub- d None of the above.
Register
78 As per Banking companies (Amendment Act, 2013) the maximum number of directors of the bank
*** including independent directors are to be – (E-16)
a 20 including 2 independent directors b 15 including 2 independent directors
c 20 including 3 independent directors d 18 including 3 independent directors
79 As regards contract act, 1872 which one of the following is not true? (E-18, 17, 16)
*** a An Agreement enforceable by law is a contact b In every contract there should be free
consent
c Agreements by persons of idiocy are not d A minor cannot be a guarantor
voide
True: (g) An agreement not enforceable by law is said to be void:
(h) An agreement enforceable by law is a contract:
(i) An agreement which is enforceable by law at the option of one or more of the parties thereto, but
not at the option of the other or others, is a voidable contract:
(j) A contract which ceases to be enforceable by law becomes void when it ceases to be enforceable.
True: 10. All agreements are contracts if they are made by the free consent of parties competent to
contract, for a lawful consideration and with a lawful object, and are not hereby expressly declared
to be void.
True: 30C. No guardian, executor, administrator, heir or personal representative of any minor or
deceased person, as the case may be, shall be entitled to or allowed any credit in his account for or
in respect of any payment made by him on behalf of such minor or deceased person in respect of
any such agreement, or any such commission, brokerage, fee, reward or claim as is referred to in
sections 30A and 30B.]
80 In case of opening an account in the name of Co-Operative societies the most important documents
*** to be verified is (E-19, 16, 19, F-18, C)
a Copy of the bye laws of the society b Certificate given by the local authorities
c Certificate given by the RJSC and firms d None of the above
81 While opening an account in the name of Co-Operative societies the most important document to be
*** verified is –(E-19, F-18, C-17)
a List of promoters/members b Bye-laws
c Instructions of the RJSC d Permission from the local authority
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Note: Accounts of Clubs, Societies, Associations, Educational institutions, co-operative Societies etc.
are constituted and governed under the bye-laws of the respective entity. Bye-laws are the local law
made by an association, club or society, in terms of Act and Rules framed by the State.
82 Cheap money implies- (F-20)
*** Law rate of interest Low level of income
Low level of savings excess of bank money
Note: "Cheap money" is money that has been borrowed at a very low interest rate. "Cheap" is used
because the money that has been borrowed is considered to be very "cheap" due to the low rate of
interest that is being paid.
83 While opening an account in the name of a local government, the most important document to be
*** seen is (F-19, 20, C-15, 18)
a Statute b Memorandum and Articles of Association
c Articles of partnership d Instruction of the RJSC
84 Which one of the following is not true (E-17)
*** a At present CRR is 5.50% b At present Bank rate is 5.00%
c Call money rate is not always fixed d All banks are to maintain SLR @ 13.00%
85 Schedule banks are to maintain SLR (E-16, C-16, AR)
*** a 13.00% of total demand & time Liabilities b 6.50% of total demand & time Liabilities
c 19.00% of total demand & time Liabilities d 19.50% of total demand & time Liabilities
86 At present schedule banks are to maintain CRR (C-21)
*** 4.50% 3.50%
4.00% 5.50%
87 Schedule banks are to maintain CRR with Bangladesh Bank separately: (F- 16, 17, C-21)
*** 5.5% of Total Demand & Time liabilities 13.00% of Total Demand & Time liabilities
19.50% of Total Demand & Time liabilities 4.00% of Total demand & time Liabilities
*POLICY RATE: Repo Rate 4.75%, Special Repo Rate 7.75%, Rev Repo Rate 4.00%, Bank Rate 4.00%.
*RESERVE RATIO: Traditional Banking SLR: 13%, CRR: 4.0%, Islamic Banking SLR: 5.5%, CRR: 4.0%,
Deposit Taker FIs SLR: 5%, CRR: 1.5%, Non Deposit Taker FIs SLR: 2.5%. *The SLR as a Monetary
Policy Instrument in Bangladesh.
88 Lien is a/an -------of the creditor to retain possession- (E-16, C-16)
***
a Obligation b Right
c Interest d Protection
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What is lien: Lien is the right of a creditor to retain the goods and securities in his possession,
belonging to debtor, until the debt due is paid. Lien does not give power of sale but only to retain
the property.
A lien is the right of a creditor in possession of goods, securities or any other assets belonging to the
debtor to retain them until the debt is repaid, provided that there is no contract express or implied,
to the contrary. It is a right to retain possession of specific goods or securities or other movables of
which the ownership vests in some other person and the possession can be retained till the owner
discharges the debt or obligation to the possessor.
89 Ancillary business of a bank implies non-fund business and the income earned from this source
*** includes income by the way of (EO-19, 16, C-18, 17, 16, F-17)
a Commission b Interest
c Brokerage d Both (a) & ©
90 What is the meaning of CAR? (E-16)
*** a Capital advance Ratio b Capital asset Ratio
c Capital Adequacy Ratio d Capital and Reserve
Note: The capital adequacy ratio (CAR) is a measure of a bank's capital. It is expressed as a
percentage of a bank's risk weighted credit exposures. Also known as capital-to-risk weighted assets
ratio (CRAR), it is used to protect depositors and promote the stability and efficiency of financial
systems around the world. RWA-Risk Weighted Asset.
91 There are ----parties involved in a guarante (E-16)
***
a 2 b 03 (Debtor /Creditor /Guarantor)
c 4 d None of the above
92 In case of guarantee there are (E-18, G)
***
a Three contacts b Two contracts
c Four contracts d None of these
Note: Section 126: A "contract of guarantee" is a contract to perform the promise, or discharge the
liability, of a third person in case of his default. The person who gives the guarantee is called the
"surety": the person in respect of whose default the guarantee is given is called the "principal
debtor", and the person to whom the guarantee is given is called the "creditor". A guarantee may be
either oral or written.
93 A power of attorney is called: (C-18)
*** On the death of the principal When principal becomes insolvent
When principal becomes insane all of the above
94 Execution of a will is entrusted to (EO-20, F-18, C-16)
*** a Administration b Holder of power of attorney
c Executor d Holder in due course
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95 As regards International Cooperative by BIFU which of the following is not must (F-19)
***
Member of APG & Egernoet Active participation with FATF Expert Group
Member of UNSCRs implementation Working with DAP
committee
APG (Asia/Pacific Group on Money Laundering): The Asia/Pacific Group on Money Laundering is a
FATF style regional inter-governmental body, the members of which are committed to implement
international standards against money laundering, the financing of terrorism and financing the
proliferation of weapons of mass destruction. Membership: 41 jurisdictions. Founded: 1997,
Bangkok, Thailand. Co-Chairs: Deputy Commissioner Ian McCartney and Mr Marzunisham Omar.
Purpose: Combat money laundering and terrorism financing.
FATF (Financial Action Task Force): The Financial Action Task Force, also known by its French name,
Groupe d'action financière, is an intergovernmental organisation founded in 1989 on the initiative of
the G7 to develop policies to combat money laundering. In 2001, its mandate was expanded to
include terrorism financing. Membership: 39. Headquarters: Paris, France. President: Marcus Pleyer.
Purpose: Combat money laundering and terrorism financing.
UNSC (United Nations Security Council: The United Nations Security Council is one of the six
principal organs of the United Nations, charged with ensuring international peace and security,
recommending the admission of new UN members to the General Assembly, and approving any
changes to the UN Charter. Headquarters: New York, New York, United States. Founded: October 24,
1945. Power: Its powers include establishing peacekeeping operations, enacting international
sanctions, and authorizing military action. The UNSC is the only UN body with the authority to issue
binding resolutions on member states. Mandate: The Security Council has primary responsibility,
under the United Nations Charter, for the maintenance of international peace and security. It is for
the Security Council to determine when and where a UN peace operation should be deployed.
96 Which one of the following statement is true? (E-20, 18, C)
*** a Garnishee order is issued by the revenue b A letter of mandate is generally issued for a
authorities short or temporary period
c Attachment order is issued by the Court of d Specific power ofattorney gives extensive
Law powers to the agent to perform many acts
97 Attachment order is issued by- (C-17)
***
Police Officer Courts of Law
Revenue Authority Manager of a Bank
98 The banker’s lien is not applied in case of (E-20, F-19, 18)
***
a Safe custody b Securities left negligently
c Debts undue d All of the above
Note: A bankers lien is a legal right arise in many common law jurisdictions of a bank to exercise a
lien over any property in the custody of the bank as security for the indebtedness of the customer to
the bank.
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99 Which one of the following is not true? E-20)
***
a At present CRR is 4.00% b At present SLR is 13%
c At present Bank Rateis 4.00% d All schedule banks are required to
maintain SLR uniformly
100 Which of the following is not true? (EO-2020, C-16, 17)
***
a Cheque is not always drawn on bank b FDR is a financial instrument
c holder can cross a cheque d Payee can transfer a cheque without the
consent of the drawer
101 Ancillary business (service) of a bank implies non-funded business and the income earned
*** from this source includes income by way of (E-20)
a Commission b Interest
c Brokerage d Both (a) and ©
102 Who can stop payment of a cheque on behalf of a partnership firm (E-20, C-17)
***
a Only the partners who have signed the cheque b All the partners jointly who are authorized
to operate the account
c Only the managing partner d Any partner whether authorized to
operate the account or not
103 Under which act return of unclaimed deposit is required to be submitted to Bangladesh Bank? (E-20)
***
a Bangladesh Bank Order, 1972 b Companies Act, 1994
c The Bank Company Act, 1991 d None of those
Note: The central bank said unclaimed bank deposits would be transferred to the government
account if no demand is received for refund of the inoperative deposit for 12 years.
Deposits and assets at banks not claimed by anyone for 10 years are considered unclaimed,
according to guidelines released by Bangladesh Bank.
104 Which of the following is not true? (E-20)
***
a In a Public Ltd. Co. the minimum number of b A Private Ltd. Co. can start their business
members is 7 and maximum unlimited soon after they get the certificate of
incorporation
c A Public Ltd. Co. cannot issue shares, d For both the companies MOA and AOA is
debentures or bonds for raising their fund required to submit to the RJSC
105 Responsibility of the presenting banks are the following except (E-20, 18, C-17, 18)
***
a Comply with the BACPS rules b To certify that the presented item is copy of
the original instruments
c Verify the prima facie genuineness of the d Obtaining positive pay instruction from
cheque the cheque issuer/drawer of the cheque
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106 Holder is a person who is (E-20, C-21)
***
a A payee of the investment b A possessor of the instrument
c In possession of the Instrument & is legally d Either (a) or (b)
entitled to get it
107 Commercial paper is a type of (E-20, 15, 18)
***
a Fixed coupo bond b Unsecured short term debt
c Equity share capotal d Government bond
Note: Commercial paper is a common form of unsecured, short-term debt issued by a corporation.
Commercial paper is typically issued for the financing of payroll, accounts payable, inventories, and
meeting other short-term liabilities. Maturities on most commercial paper ranges from a few weeks
to months. Commercial paper is usually issued at a discount from face value and reflects prevailing
market interest rates.
108 Cash is (E-19)
*** a Financial Assets b Intangible Asset
c Fictitious Asset d Non-Financial Asset
109 In case of indirect finance, fund is transferred from (E-19)
*** a Deficit unit ro surplus unit b Surplus unit to deficit unit
c Depositer to banker d None of this
Indirect finance: Indirect finance is where borrowers borrow funds from the financial market
through indirect means, such as through a financial intermediary. This is different from direct
financing where there is a direct connection to the financial markets as indicated by the borrower
issuing securities directly on the market. Common methods for direct financing include a financial
auction (where price of the security is bid upon) or an initial public offering (where the security is
sold for a set initial price).
110 Commercial Bank deals with the wide array of general banking except (E-19, F-18)
***
a Deposit mobilization b Providing efficient customer services
c Mazimize profit for the organization d Ensure Money sypply
111 The Holder of a Negotiable Instrument means -(F-17)
***
The Payee or Endorsee who is in possession of Any person who receives an instrument
it or a person who possess the Negotiable innocently (in good faith & without
Instrument in his own name and received negligence), who has paid value for
payment. receiving the Negotiable Instrument before
maturity of it (NI) and who is in possession
of instrument as a bearer or payee or
endorsee (Holder in due course).
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112 Holder of a negotiable instrument means- (17)
***
Payee or endorsee who is in possession of it A person who is bearer thereof
The person who is in possession of it and None of these
legally entitled to receive the money due on it
Note: Holder is a term used to any person that has in their custody a promissory note, bill of
exchange or cheque. It should be entitled in his own name. Holder means a person entitled in his
own name to the possession of a negotiable instrument and to receive the amount due on it.
113 How long a bank branch can maintain an unclaimed account? (E-19)
***
a 1 Years b 5 Years
c 2 Years d 10 Years
114 Penalties for non-compliance, in case of failure to provide the requested information timely by the
*** BFIU is (E-19)
a Per Day 5000, Max 2 Lac b Per day 20000 Max 10 lac
c Per Day 10000 Max 5 lac d None of this
115 Who practices direct mode of finance? (E-19, F-20)
***
a Mutual Fund b Bond Market
c Stock Market d Both B & C
116 A limit that would not allow a bank to lend money over a certain percentage from its deposit money
*** is called (E-19)
a CRR b SLR
c ADR d None of these
117 Which of the following is true about application of interest in a savings bank account a Deceased
*** person (E-19, F-18)
a Interest will not be applied to the deceased b Interest will be applied to the deceased
account account up to the date of closing of the
accounts
c Interest will be applied to the deceased d None of the above
account up to the date of expiry of the
depositor
118 In which of the following instruments discharge is required for having payment (E-19, F-18)
*** a Demand Draft b FDR
c Cheque d Bill of Exchange
119 The larceny of assets by a person in a position of trust or responsibility over those assets is called (E-
*** 19)
a Embezzlement b Deception
c Concealment d All of This
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What Is Embezzlement: Embezzlement refers to a form of white-collar crime in which a person or
entity misappropriates the assets entrusted to them. In this type of fraud, the embezzler attains the
assets lawfully and has the right to possess them, but the assets are then used for unintended
purposes.
120 An account held in the name of a decedent that is administered by an executor or administrator of
*** the estate is called (E-19)
a Executors account b Escrow account
c Estate account d Administrator account
What Is an Executor: An executor of an estate is an individual appointed to administer the last will
and testament of a deceased person. The executor's main duty is to carry out the instructions to
manage the affairs and wishes of the deceased. The executor is appointed either by the testator of
the will (the individual who makes the will) or by a court, in cases wherein there was no prior
appointment.
121 Certification of incorporation is required for- (E-19)
***
a Joint Account b Minor Account
c Public Limited Company d Semi-Government Account
The Registrar of Joint Stock Companies and Firms (RJSC) is the sole authority which facilitates
formation of companies etc.; and keeps track of all ownership related issues as prescribed by the
laws in Bangladesh. (Certificate of Incorporation is the proof that your company was formed at
Companies House and is a legal entity).
122 Which of the following is/are true about the sub-prime crisis? (F-20)
*** It is a mortgage crisis referring to credit default Sub-prime borrowers who were rated low
by the borrowers and were high risk borrower
This crisis originated because of negligence in All of these
credit of the borrowers
123 Treasury bills are traded in the- (F-20)
***
Govt. Market Capital Market
Money Market Regulated Market
Note: Treasury bills are traded in the money market. The money market is the trade in short-term
debt investments. At the wholesale level, it involves large-volume trades between institutions and
traders.
124* Conceptually banks should handle (F-20)
** Money Market Instrument Capital Market Instrument
Securities Instrument All of the above
125 Which one of the following is money market financial instrument? (EO-18, C-18)
*** a Treasury bill b Common Stock
c Corporate Bond d Mutual fund
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Note: The main money market instruments are Treasury bills, commercial papers, certificate of
deposits, and call money.
126 Which of the following is not the security features for deciding the genuineness of a note? (C-17)
*** Intaglio printing Latent image in vertical band
Electrotype watermark Optically invariable ink
127 Which of the following is not the security features for deciding the genuineness of a note? (C-16)
*** Which of the following is not the security features for deciding the genuineness of a 500 or 1000 TK
Note? (F-18)
Paper quality Security thread
Electrotype watermark Optically invariable ink
Note: The colour of ‘1000’ printed with Optically Variable Ink (OVI) in the upper right hand side
will shift from golden to green and vice versa in the event of oscillation of the note.
Note: The colour of ‘500’ printed with Optically Variable Ink (OVI) in the upper right hand
side will shift from red to light green and vice versa in the event of oscillation of the note
128 When $1=Tk.70 turns into $1=80 then it will be called- (E-18)
***
a Monetary contraction b Inflation
c Devaluation d Reduction of Money supply
129 Which of the following negotiable instrument is drawn, accepted or endorsed without
*** consideration?
Bill of exchange endorsed by a reputable third party acting as a guarantor as a favour and without
compensation, also can be discounted on the financial strength of the guarantor who remains liable
until the bill is paid is called (F-19, 20)
a Accommodation bill b Corporate guarantee
c Acceptance credit d None of these
Note: Accommodation bill is a type of Bill of exchange endorsed by a reputable third party called an
accommodation party or accommodation endorser acting as a guarantor, as a favor and without
compensation. The bill then can be discounted on the financial strength of the guarantor who
remains liable until the bill is paid.
130 The appropriate regulatory agencies those empowered to create and enforce the acts-are authorized
*** to draft………that implement them is called………….. (E-18)
a Rules b Regulations
c Ordinances d Both (a) and (b)
131 The customer of a bank who gives order for making payment through a cheque is called- (C-16)
*** Payee Drawer
Drawee None of these
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Section- 7 (The Negotiable Instruments Act, 1881 ): The maker of a bill of exchange or cheque is
called the “drawer;” the person thereby directed to pay is called the “drawee.”
132 The person named in the instrument to whom or to whose order the money is directed to be paid is
*** called- (EO-2018, C-17,18)
a The drawer b The drawee
c The Payees d The borrower
Note: The maker of a cheque is called the 'drawer', and the person directed to pay is the 'drawee'.
The person named in the instrument, to whom or to whose order the money is, by the instrument
directed, to be paid, is called the 'payee'.
133 Which of the following person cannot open an account with a bank? (EO-18, 17, C-18, 17, 16)
*** a An adult b Idiotic in nature/Lunatic/Insolvent
c Solvent, Unethical Person d Minor with guardian
134 The right of lien is available to the banker only when the goods securities have been given to him as-
*** (E-18)
a Trusty b Beneficiary
c Agent d Bailee
Note: (i) The banker possesses the right of general lien on all goods and securities entrusted to him
in his capacity as a banker and in the absence of a contract inconsistent with the right of lien. Thus,
he cannot exercise his right of general lien if –
(a) the goods and securities have been entrusted to the banker as a trustee or an agent of the
customer; and
(b) a contract – express or implied – exists between the customer and the banker which is
inconsistent with the banker’s right of general lien. In other words, if the goods or securities are
entrusted for some specific purpose, the banker cannot have a lien over them. These exceptional
cases are discussed later on.
135 The Articles of Association of a Limited Company contains- (E-17, 18, C-15, 18)
***
a Objects of the company b Internal management of the company
c Both (a) and (b) d None of the above
Note: Articles of association are a document that specifies the regulations for a company's
operations and defines the company's purpose. The document lays out how tasks are to be
accomplished within the organization, including the process for appointing directors and the
handling of financial records.
136 Which one of the following is not related to fraud? (C-21)
***
Misrepresentation Conceal
Promise Deceive
137 Which one is not included in financial crime? (E-17, 18, C-16)
***
a Cheque b Credit Card Fraud
c Over invoicing for purchasing an office articles d Purchase of personal luxury items
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138 Which one is not included in financial crimes (C-18)
***
Bank fraud Credit card fraud
Over-invoicing Bonafide mistake
139 Financial system is broadly comprises of (EO-2018)
***
a Financial institutions b Financial instruments
c Financial Markets d All of These
140 A note in which an alteration has been made in the number, signature or value or in any other
*** respect is called- (C-16)
Deformed note Damp note
Charred note Altered note
141 A note which is burnt or having sign of burn partially or wholly is called (E-17, 18, C-16, 17, 18, 21)
***
a Altered Note b Damp Note
c Deformed Note d Charred Note
142 No claim in present of mutilated note shall be entertained unless the single largest piece of the note
*** presented is more than- (C-16, 17, 18)
41% 50%
70% 90%
Disposal of mutilated note(s): No Claim in respect of a mutilated note shall be entertained unless
the single largest piece of the note presented is more than 50%. Where the single largest piece is
more than 50% the payment shall be made in the following manner, namely:
(i) Full value shall be payable if the area of the note presented is more than 90% of the respective
denomination. (ii) Proportionate value shall be payable if the area of the not e presented is more
than 50% and less than or equal to 90% of the respective denomination as under:
1. 51% - 75%= 50%
2. 76% - 90%= 75%
143 A note formed by joining half note of one note to a half note of another note is called- (C-16, 17, 18)
***
Mutilated Note Half Note
Mismatched Note Decomposed Note
"Altered Note": means a note in which an alteration has been made in the number, signature or
value or in any other respect;
Appellate Authority": means and includes the Currency Officer or the Officer equivalent to currency
officer of an Office of Bangladesh Bank authorized by the Head Office to dispose of appeals for
reconsideration received in the Office in respect of the cases rejected by the "Prescribed Officer" of
the said Office. The Appellate Authority will have the same power as prescribed in these Regulations
for the Prescribed Officer;
"Bank": means the Bangladesh Bank constituted by the Bangladesh Bank Order - 1972 (President's
Order No. 127 of 1972);
"Charred Note": means a note which is burnt or having sign of burn partially or wholly;
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"Damp Note": means a note which is wet partly or fully, or so weak that the note(s) can be easily
broken or torn when counted or handled;
"Deformed and Decomposed Note": means a note which has been deformed or disfigured or
vitiated or decomposed by anyway or by writing with ink or other materials on the note(s);
'Essential Features'': means the features, including security features, which are necessary for the
identification of a note
"Half Note": means half of a note which has been divided vertically or horizontally through or near
the centre. A note formed by joining one half, which is identifiable, to another half, which is not
identifiable as belonging to the note to which first mentioned half belongs , will not be accepted as a
single note but will be treated as two half notes;
"Mismatched note": means a note formed by joining a half note of one note to a half note of
another note.
"Mutilated note": means a note of which a portion is missing or a note which is composed of pieces,
provided that the note presented is clearly more than half a note in area and that if the note is
composed of pieces of a note joined together, each piece is, in the opinion of Prescribed Officer,
identifiable as the part of the same note.
"Note": means a note of the Bangladesh Bank issued by the Bank and a currency note of the
Government of the People's Republic of Bangladesh issued by the Government.
"Number": includes the letter (s) and number (s) denoting the series to which the note belongs;
"Obliterated Note": means a note, not being a mutilated or altered or mismatched note, which has
become or has been rendered fully or partially undecipherable;
"Office of Issue": means the Issue Department of the Bank situated at Dhaka.
"Prescribed Officer": means and includes the Deputy General Manager/Joint Manager or equivalent
officer of the Office of Issue and other offices of Bangladesh Bank, designated by the concerned
office.
144 Banks are financial intermediaries, because they intermediate between (E-18, C-17)
*** a Surplus units and deficit units b Depositors and borrowers
c Ultimate lenders and ultimate borrowers d All of these
145 Bankers right of set off an be applied- (C-18)
*** To existing debt only To all debt including contingent liability
To exiting debts which is due only To al debts including debts payable at
future date
146 The Right of Set of is- (E-18, C-17)
*** a Customer's Right b Banker's Right
c Banker's Discretion d Banker's Obligation
Right of Set off (Banking) Law and Legal Definition. In order to cover a loan in default, a bank has a
legal right to seize funds of a guarantor or the debtor. A settlement of mutual debt between a
creditor and a debtor through offsetting transaction claims is also known as setoff.
147 Cash management includes – (C-18)
*** Cash vault management cash counter management
Cash Remittance management All of these
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148 Cash management of bank is the responsibility of the (E-18)
***
a Teller b Cash manager in charge
c Head of accounts d Head of ICC
149 From which point of the following cash management is important? (C-18)
***
safe and Security proper utilization
customer service development all of these
Note: Cash management refers to a broad area of finance involving the collection, handling, and
usage of cash. ... Sometimes, private banking customers are given cash management services.
Financial instruments involved in cash management include money market funds, treasury bills, and
certificates of deposit.
150 Writing a cheque in an amount that will overdrawn the account by making up the deficiency by
*** depositing another cheque on another bank is called= (F-19, 20)
a Forged cheque b Cheque kiting
c Accommodation Bill d Error Resolution
Note: Check kiting or cheque kiting is a form of check fraud, involving taking advantage of the float
to make use of non-existent funds in a checking or other bank account. In this way, instead of being
used as a negotiable instrument, checks are misused as a form of unauthorized credit.
Kiting is commonly defined as intentionally writing a check for a value greater than the account
balance from an account in one bank, then writing a check from another account in another bank,
also with non-sufficient funds, with the second check serving to cover the non-existent funds from
the first account.[1] The purpose of check kiting is to falsely inflate the balance of a checking account
in order to allow written checks to clear that would otherwise bounce. If the account is not planned
to be replenished, then the fraud is colloquially known as paper hanging.[2] If writing a check with
insufficient funds is done with the expectation they will be covered by payday it is called playing the
float.
151 A legal process by which a court of law at the request of a creditor depositors designates specific
*** property owned by the debtor to be transferred to the creditor or sold for the benefit of the creditor
is defined as= (F-19, 20)
a Assignment b Adornment
c Attachment d Attornment
Note: Attachment is a legal process by which a court of law, at the request of a creditor, designates
specific property owned by the debtor to be transferred to the creditor, or sold for the benefit of the
creditor. A wide variety of legal mechanisms are employed by debtors to prevent the attachment of
their assets.
152 As regards minor as a partner which of the following is not true? (F-19, 20)
***
a As per Sec. 30 of Partnership Act, 1932 a minor b With the consent of all the partners, for the
cannot be a partner of a firm time being a minor may be admitted to the
benefits of partnership
c Such a minor has a right to such share of the d Such a minor is entitled to sue the
property and of the profits of the firm partners for an account or the share of the
profit of the firm
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153 The primary objective of Nationalization of Banks was-(F-19, 20)
***
a Improving credit facilities b Financing in Industries
c Improving security of deposits d Consolidating the economy
154 Which one of the following is controlled by the World Wide Web- (F-19, 20)
***
Virtual Banking (internet Banking) Universal Banking
Wholesale Banking Wholesale Banking
Definition: The Virtual Banking is the provision of accessing the banking and related services online
without actually going to the bank branch/office in person. Simply, availing the banking services
through an extensive use of information technology without any requirement for the physical walk-
in premises is called as virtual banking. Any financial institution that offers the traditional banking
services online is termed as a virtual bank. Virtual banking enables a customer to pay bills online,
check account details, secure loans, withdraw and deposit money anytime as per the convenience.
155 Which of the following is not an asset held by commercial banks? (F-19)
*** Bill of exchange Current Account deposits
Money lent at short notice Credit balance with the BB
156 Crypto currency is a –(F-19)
*** a Plastic money c Digital medium of exchange/Digital
Payment
b Digital payment d Both (a) & (b)
Note: A cryptocurrency (or “crypto”) is a digital currency that can be used to buy goods and services,
but uses an online ledger with strong cryptography to secure online transactions. Much of the
interest in these unregulated currencies is to trade for profit, with speculators at times driving prices
skyward.
157 The main business of banks is to accept deposits from the public. However, a bank can refuse to
*** permit opening an account on behalf of _______:(F-19)
Artificial Person Undesirable Person

Arrested Person Convicted Person
158 Currency notes deposited in the currency chest are the property of-(F-19)
***
Respective Bank Bangladesh Bank
GOB All of these
159 The financial statement that reports assets, liabilities and stockholders’ equity is termed as-(F-19)
*** Income statement Retained earnings statement
Balance Sheet Statement of cash flows
Note: The term balance sheet refers to a financial statement that reports a company's assets,
liabilities, and shareholder equity at a specific point in time. Balance sheets provide the basis for
computing rates of return for investors and evaluating a company's capital structure. In short, the
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balance sheet is a financial statement that provides a snapshot of what a company owns and owes,
as well as the amount invested by shareholders. Balance sheets can be used with other important
financial statements to conduct fundamental analysis or calculating financial ratios.
160 Main functions of Central Bank is to- (F-19)
*** a Formulate of Monetary policy b Formulate Fiscal policy
c Maintain liaison with the Govt d All of these
The Bangladesh Bank performs all the functions that a central bank in any country is expected to
perform. Such functions include maintaining price stability through economic and monetary policy
measures, managing the country's foreign exchange and gold reserve, and regulating the banking
sector of the country.
1. Central banks carry out a nation's monetary policy and control its money supply, often
mandated with maintaining low inflation and steady GDP growth.
2. On a macro basis, central banks influence interest rates and participate in open market
operations to control the cost of borrowing and lending throughout an economy.
3. Central banks also operate on a micro-scale, setting the commercial banks' reserve ratio and
acting as lender of last resort when necessary.
161 Which one of the following is a financial instrument but not medium of exchange? (C-21)
*** Coins Currency Notes
Shares Debit card
162 Which one of the following is not the asset of a Bank? (C-21)
*** Cash Equity Capital / Customer Deposits
Loans & Advances Investment
Asset of a Bank: Bills of exchange, Credit balances with the Reserve Bank, Money lent at short
notice.
163 Financial system is concerned with mobilization of fund form (F-18)
***
a Depositor to Banker b Banker to Borrower
c Sever to lender d Saver to Borrower
Note: Banks as Financial Intermediaries. Banks act as financial intermediaries because they stand
between savers and borrowers. Savers place deposits with banks, and then receive interest
payments and withdraw money. Borrowers receive loans from banks and repay the loans with
interest. In turn, banks return money to savers in the form of withdrawals, which also include
interest payments from banks to savers.
164 In MICR lines which of the following codes is not used (F-18, C-17, 18)
*** Bank’s routing numbers Cheque serial number
Account number Deposit type/Name of the
customer/Account Balance
How Do You Read a MICR Line: The data printed with MICR technology appears on the bottom left
of a check and includes three strings of characters. From left, they are:
The nine-character routing number that identifies the bank branch.
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The 12-character account number that identifies the payer.
The four-character check number that indicates which check in a series that the account holder has
used.
165 Which of the following is not true? (F-18)
*** a Cheque is always drawn on bank b Payment order is a financial instrument
c Any holder can cross a cheque d Payee cannot transfer a cheque without
the consent of the drawer
166 As regard contract Act, 1872 which of the following is not true? (F-18, C-21)
***
a An agreement enforceable by law is a contract b An illegal agreement is one which is
against law in force
c The person, who is competent to enter into d The law of contract is mostly related to
contract, may open a Bank account financial instruments
167 Which of the following is a common characteristic of all Banking financial institutions? (F-20)
*** Which of the following is a common characteristic of all financial institutions? (E-20, F-18)
a Their liabilities are money b They practice indirect mode of finance
c They offer only short term financing d They constitute monetary system
168 Which of the following is not true? (F-18, 20, C-18)
***
Bank may accept standing instruction on The main objective of recurring deposit
savings account. account is to develop regular savings habit
among the public.
Premature encashment of FDR is allowed as Overdraft is allowed against SND account.
per request of the customer.
169 Which of the following does not fall under paying bank, due diligence? (F-18)
*** Transmission of posting file Digital Certificate Verification of CHM
Verify the prima facie geniuses of the cheque payment processing.
170 Which of the following is absolutely essential for a general crossing? (F-18, C-17, 18)
*** Words and Company Two parallel transverse lines
Words Not Negotiable Name of a bank.
171* Banker’s Lien is generally described as an- (E-17, F-18, C-18)
** a Hypothecation b IGPA for mortgage
c Implied pledge d Bailment of goods
Difference between lien and pledge:
In the case of a lien, the lender has the right to retain but not to sell the asset. For banks, a lien is an
implied pledge, i.e., the bank has the right to sell the asset if the borrower defaults.
But in case of a pledge, the lender has the right to retain and sell the pledged asset if the borrower
defaults.
Banker's lien : A banker's lien is more than a general lien. It is implied pledge and banker has a right
to sell the property after reasonable notice, provided the property comes into his hands in the
ordinary course of his business.
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172 In Which Circumstances the Banker is Entities to disclose the information of the customer’s account?
*** (F-18)
Legal bindings Consent of the Customer
Garnishee Order All of these
173 When a holder cannot get a better title than the previous owner? (F-18)
*** In case of ‘not negotiable cross cheque’ In case of ‘account payee only’ cross
cheque
In case of ‘not transferable’ cross cheque In case of ‘& Company’ cross cheque
174 Decrease in the general level of prices in economic recession is known as- (F-20)
***
Inflation Depreciation
Deflation Hyperinflation
175 The economy states that decrease in the general price level of goods & services over a period of time
*** in a country this situation is shown: (F-17)
Deflation Inflation
Recession
Inflation: When the price of goods and services increases in a period of time, it is called inflation in
the language of economics. Usually when the price of a commodity goes up, you need more money
to buy that product with the local currency or you can buy less quantity if you buy the previous
product with the same amount of currency.
Deflation: Deflation is a general decline in prices for goods and services, typically associated with a
contraction in the supply of money and credit in the economy. During deflation, the purchasing
power of currency rises over time.
Recession: A recession is a macroeconomic term that refers to a significant decline in general
economic activity in a designated region. It had been typically recognized as two consecutive
quarters of economic decline, as reflected by GDP in conjunction with monthly indicators such as a
rise in unemployment. However, the National Bureau of Economic Research (NBER), which officially
declares recessions, says the two consecutive quarters of decline in real GDP are not how it is
defined anymore. The NBER defines a recession as a significant decline in economic activity spread
across the economy, lasting more than a few months, normally visible in real GDP, real income,
employment, industrial production, and wholesale-retail sales.
176 Which of the following is not legal tender money (E-17, C-18)
*** a Debit Card b Hundred Taka CurrencyNote
c Cheque d Both (a) and (c)
177 Which of the following is not true? (C-17)
*** A draft may be payable either to bearer or A banker’s cheque can be used only for
order making local payment
A postdated cheque can never be honored The offence under Sec. 138 of N.I Act is
deemed to have been committed from the
date of drawing a cheque.
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178 Banker customer relationship comes to an end in case of- (C-21)
***
Insolvency of a customer Death of a customer
Insanity of a customer All of the above
179 One of the directors of a limited company expired and cheques signed by him are presence for
*** payment, should be bank pay these cheques (E-17, C-17, 18)
a Cannot pay b Can pay upon other directors confirmation
c Can pay as a routine d Payments be stopped by the company
180 Which of the following is the lender’s recourse related law (E-17)
***
a Contract Act, 1872 b Bank Company Act, 1991
c Artha Rin Adalat Ain, 2003 d All of these
181* Which of the following create liabilities of a bank (E-17, C-16, 17, 18)
**
a Savings deposit/ Special Notice Deposit b Fixed deposit
c Current deposit d All of These
182 In case of payment from Deceased Account, which one of the following documents should be taken?
*** (C-21)
Letter of guarantee Letter of indemnity

Demand promissory note Both (b) and ©
183 When FDR is lost by a customer of a bank, what document is executed-
***
When a Cheque Book/FDR/Pay Order is lost by a customer of a bank, which of the following
document needs to be executed? (E-17, C-18, 21, 17, 16)
a Guarantee bond b Treasury bond

c Indemnity bond d Security bond
Indemnity bond: A letter of indemnity (LOI) is a contractual document that guarantees certain
provisions will be met, between two parties.
184 Deposits recorded by the depositor but not yet recorded by the Bank means-(E-17, C-16)
***
a Restricted deposit b Outstanding deposit
c Deposit in transit d All of these
185 The court issue a certified copy named probate in a will appoint: (F-17, 16)
***
The person appointed to operate the account after his death by the deceased himself before his
death is called-
a Executor b Administrator
c Attorney d None of the above
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What Is an Executor: An executor of an estate is an individual appointed to administer the last will
and testament of a deceased person. The executor's main duty is to carry out the instructions to
manage the affairs and wishes of the deceased. The executor is appointed either by the testator of
the will (the individual who makes the will) or by a court, in cases wherein there was no prior
appointment.
The Succession Act, 1925 (30th September, 1925): 222. (1) Probate shall be granted only to an
executor appointed by the will. (2) The appointment may be expressed or by necessary implication.
186 Objectives of KYC is- (E-16, 17, C-21, 17, 16)
***
a To ensure appropriate customer identification b To monitor transactions of suspicious
nature
c To ensure that he/she would not deceive the d Only (a) and (b)
bank
187 KYC is required for- (C-21)
***
Account holder Walking customer
Employee All of the above
188 CTR (CASH TRANSACTION REPORT) is required for which of the following amount in Banks (E-16, C-
*** 16, 18)
a 5.00 lac b 5.50 lac
c 7.00 lac d 10.00 lac
189 PEPs stand for- (C-21)
*** Politically Exposed Persons Property Earned by Politicians
Public Earned Properties None of the above
Politically Exposed Persons (PEPs): 1. Foreign PEPs; 2. Domestic PEPs (known as Influential Persons:
IPs in Bangladesh) and 3. Chief or similar high-ranking positions in an international organization.
190 A draft issued by the bank has been lost by the payee. He sends a letter to the issuing bank to stop
*** payment. Bank will- (F-19, 20)
Not act on the request Stop the payment
Note caution and will advise the payee to Perform no action
contact purchaser of the draft
Note: A bank draft is a cheque drawn by the bank out of its own funds which bears more liquidity
then a normal cheque. If a draft is lost by the payee and he immediately sends a letter to the bank
informing the same then the bank will not his caution and stop the transfer as well as bank will
advise the payee to contact the payer for another draft.
Modes of Charging Security:
Pledge: Pledge is the bailment of the goods as security for payment of a debt or performance of a
promise. A pledge may be in respect of goods including stocks and share as well as documents of
title to goods such as railway receipt, bills of lading, dock warrants etc. duly endorsed in bank’s favor.
"Section 172 Contact Act 1872".
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Hypothecation: In case of hypothecation, the possession and the ownership of the goods both rest
the borrower. The borrower to the banker creates an equitable charge on the security. The borrower
does this by executing a document known as Agreement of Hypothecation in favor of the lending
bank.
Lien: Lien is the right of the banker to retain the goods of the borrower until the loan is repaid. The
bankers’ lien is general lien. A banker can retain all securities in his possession till all claims against
the concern person are satisfied. "Section 171 of The Contract Act, 1872."
Mortgage: According to section (58) of the Transfer of Property Act, 1882 mortgage is the ‘’transfer
of an interest in specific immovable property for the purpose of securing the payment of money
advanced or to be advanced by way of loan, existing or future debt or the performance of an
engagement which may give rise to a pecuniary liability”. In this case the mortgagor does not
transfer the ownership of the specific immovable property to the mortgagee, only transfers some of
his rights as an owner. The banker exercises the equitable mortgage. "Section 58, Transfer of
property Act-1882)".
Assignment: It is a mode of providing securities to a banker for an advance .It is transfer of a right ,
property or a debt .The transfer is called assignor and the transferee assignee.
Set-off: Set off means total or partial merging of a claim of one person against another in a counter
claim by the latter against the former. It is in effect, the combining of accounts of the debtor and
creditor, to arrive at the former. It is in effect, the combining of accounts of the debtors and
creditors, to arrive at the met balance payable to one or the other .The right of set off is a statutory
right and can also arise out of an agreement between parties.
191 Which one of the following is not a function of a Bank/Commercial Bank? (C-18, 21)
*** Lending of Money Control credit & money supply
Agency service Accepting of deposit
192 Which of the following is not true? (C-18)
*** Bill of exchange is a negotiable instrument FDR is not a financial instrument
Any holder can cross a cheque Payee can transfer a cheque without the
consent of the drawer
193 A cheque can be drawn upon- (C-16, 18)
***
Any person Specified person or firms/companies
A bank only all of these
194 A disbursement system that uses wire, telephone or computers to transfer funds from one location
*** to another location is called. (EO-20, 19, F-18, C-16)
A bank in whereles, network etc, connected andan order is directed for sending remittance from one
bank branch to another bank branch through. (F-16, 17)
a Offline clearing b BACH

c EFT (Electronic Funds Transfer) d NPS
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195 The bank which receives payment instructions from its client and forwards the entry to the BEFTN is
*** called- (C-17, 18)
Originator Originating bank
Receiving bank Correspondent bank
Originating Bank (OB): The originating bank is the bank which receives payment instructions from its
client (the originator) and forwards the entry to the BEFTN. A bank may participate in the EFT system
as a receiving bank without acting as an originating bank; however, if a Bank chooses to originate EFT
entries, it must also agree to act as a receiving bank.
Originator: The Originator is the entity that agrees to initiate EFT entries into the network according
to an arrangement with a receiver. The originator is usually a company, government agency or an
individual directing a transfer of funds to or from a consumer’s or a company’s account. The
originator executes an EFT fund transfer entry through an Originating Bank (OB).
Bangladesh Electronic Funds Transfer Network (BEFTN): BEFTN is the central clearing facility,
operated by Bangladesh Bank that receives entries from OBs, distributes the entries to appropriate
RBs, and facilitates the settlement functions for the participating banking institutions. Bangladesh
Electronic Funds Transfer Network(BEFTN) is a system of transferring money from one bank account
directly to another bank without money changing hands.
Receiving Bank (RB): The receiving bank is the bank that will receive EFT entries from BEFTN and
post the entries to the account of its depositors (Receivers).
Receiver: A receiver is a person/organization who has authorized an Originator to transmit an EFT
entry to the account of the receiver maintained with the Receiving Bank (RB).
Correspondent Bank: In some cases an Originator, Originating Bank or Receiving Bank may choose to
use the services of a Correspondent Bank for all or part of the process of handling EFT entries. A
Correspondent Bank’s function can include, but is not limited to, the creation of EFT files on behalf of
the Originator or acting on behalf of an OB or RB, respectively. All Correspondent Banks must be
approved by Bangladesh Bank before a bank enters into an agreement with the Correspondent Bank.
National Payment Switch Bangladesh (NPSB: Bangladesh Bank has introduced National Payment
Switch Bangladesh (NPSB) in order to facilitate card based interbank electronic payments originating
from different electronic delivery channels like Automated Teller Machines (ATM), Point of Sales
(POS), Internet Banking, Mobile Devices based Banking etc. The main objective of NPSB is to create a
common electronic platform to facilitate the expansion of the electronic retail payment networks
substantially and promote e-commerce throughout the country. (as per PSD circular 09/2019, dated
11.03.2019).
196 Type of cheque clearing under BACPS may be- (C-18)
***
Regular Value High Value
Both (a) and (b) None of these
Bangladesh Automated Cheque Processing Systems (BACPS): There are two types of cheque
clearing under BACPS, i.e. High Value (HV) and Regular Value (RV) Cheque clearing. Cheque
amounting Tk. 5,00,000 or above are eligible for HV clearing which has shorter clearing cycle than
RV.
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197 Which of the following is not the security feature for detecting the government of a note. (C-18)
***
paper quality security thread
watermark optical invariably ink
198 Which of the following is not the example of EFT debit application? (C-17)
***
Utility biii payments EMI
Refunds of IPO Insurance premium
199 BACH means- (C-21)
***
Bangladesh Automatic Clearing House Bangladesh Automated Clearing House
Bangladesh Automated Clean House Bangladesh Automated Cheque House
200 Which is not included in Cash balance of a bank branch on a particular date? (C-16)
***
Cash balance of a bank branch of a particular date includes except (C-18)
a coin and note b pizebond
c sonchoypotra d both (a) & ©
201 High value of cheque clearing means clearing of a cheque amounting to BDT – (C-17, 18)
***
One lakh and above Five lakh or above
One lakh and above None of this
202 As regards RTGS which of the following is not true? (E-18, F-19, 20)
***
a RTGS are founds transfer systems b Money takes place from one bank to
another on a real time and on net basis
c Speed up the process of high value payments d Once processed, payments are final and
irrevocable
203 RTGS payment process in the following currencies- (C-18)
***
Bangladeshi tk (BDT) British pound (GBP)
United states dollar (USD) All of this
204 Which of the following currencies is not acceptable in RTGS: (F-18)
***
Bangladesh Taka (BDT) United states Dollar (USD)
British Pound (GBP) Euro (EUR)
All of The Above
RTGS processes payments in the following currencies: 1. Bangladesh Taka (BDT); 2. British Pound
(GBP); 3. Canadian Dollar (CAD); 4. Euro (EUR); 5. Japanese Yen (JPY) and 6. United States Dollar
(USD).
RTGS: To facilitate safe, secured and efficient interbank payment system, Bangladesh Bank
introduced Real Time Gross Settlement (RTGS) system on 29th October 2015 as part of its inclusive
digitalization initiative. System is designed to settle high value (more than or equal to 1, 00,000 BDT)
local currency transactions as well as domestic foreign currency transactions.
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Value Limits: The minimum amount for an RTGS payment in BDT is 1,00,000.00 (Taka one hundred
thousand). However, there is no minimum limit for foreign currency payments and BB may choose to
relax this limit for specific local currency payments (like Tax, VAT and Customs duty) as well. There is
no maximum limit for the amounts that may be transferred through BD-RTGS except the system’s
acceptable amount field limit, which is 17 digits.
205 In order to facilitate interbank electronics payment originating from different channels which of
*** following payment system has been introduced by Bangladesh bank? (C-17, 18)
BACH NPSB
RTGS BEFTN
206 In each RTGS payment information of the transection reference number that to be inserted by the
*** originating bank must be of (C-18)
Nine digit five digit
fifteen digit Sixteen Digit
Transaction Reference Number: There must be a sixteen digit transaction reference number inserted
by the Originating Bank to each RTGS payment instruction. This number consists of
a 3 digit bank code (used for BACH), 6 digit value date (DDMMYY format), and a seven digit
transaction serial number (unique for the day) for that particular OB.
207 The Minimum amount for an RTGS payment in local currency is – (C-18)
*** BDT 1 lakh BDT 3 lakh
BDT 5 lakh and more BDT 10 lakh
208 The originator in BD RTGS system are as follows (C-18)
*** A company bank itself
government agency or an individual all of this
209 Disadvantage of a credit card holder is (C-17, 18)
*** over spending debt trap forged signatures
frauds due to loss or theft cards forges charged slips
210 Which of the following amount is eligible for high value clearing and has shorter clearing cycle than
*** regular value? (C-18)
bdt 1.00lac and above BDT 3 lac and above
BDT 5.00 lac and above BDT 10.00 lac and above
211 BACPS uses the cheque imaging truncation (CIT) Technology for Electronic presentment and
*** payment paper instruments that includes- (C-18)
Cheque Pay order
Dividend and refund warrants All of these
Bangladesh Automated Cheque Processing Systems (BACPS): Bangladesh Automated Cheque
Processing Systems (BACPS) has started its 'Live Operation' on 7th October 2010 in the Dhaka
Clearing House area. BACPS uses the Cheque Imaging and Truncation (CIT) technology for electronic
presentment and payment of paper instruments (i.e. cheque, pay order, dividend & refund
warrants, etc). The system supports both intra-regional and interregional clearing and is based on a
centralized processing center located in Dhaka and in designated clearing regions.
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212 Which of the following is the govt note (C-18)
***
BDT 100 BDT 50
BDT 10 BDT 5
Note: Which of the following are government issued currencies: One, two and five taka notes and
coins
213 Which of the following is the advantage of BACH? (C-18)
*** Streamline process
Faster Reimbursement Al of this
214 For using safe deposit locker facilities bank customer are to pay- (C-18)
*** commissioner on locker exchange on locker
rent on locker safe custody charge
215 Which one of the following is known as savings bank account opened with a commercial bank with
*** zero balance or minimal balance? (C-18)
current account no frill Account
Savings bank Ordinary account All of this
216 Treasury Bills/Treasury Bonds issued by (C-18, E-14)
***
a Bangladesh Bank b Sonali Bank
c Bangladesh Government d Foreign Bank
Treasury Bill is a short term investment issued through auctions conducted by the Central Bank of
Bangladesh on behalf of the Government. Treasury Bills are issued at a discount and the face value is
paid at maturity with interest paid up-front.
The treasury Bills and treasury Bonds are issued by Bangladesh Bank on behalf of Bangladesh
Government So the investment in Bills and Bonds are safer and risk free. Treasury Bills are sold by-
Bangladesh Bank
217 what are motives to hold cash related to the day to day operation of the bank? (C-18)
***
speculative motives transactional motives
Compensating balances precautionary motives
218 ……………..Cannot be cancelled or its payment cannot be stopped without the Consent of the
*** beneficiary (C-21)
Demand draft Payment order

Travelers cheque None of the above
219 Which one of the following is the costliest source of fund for a bank? (C-21)
***
Current account FDR
Savings account SND account
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220 Which one is the most popular form of collateral security to banks in Bangladesh? (C-21)
***
Stocks of Goods Machinery and equipment
Bond and Share Land and Building
221 MICR line consists of ……….codes. (C-21)
***
4 5
6 8
What Is a Magnetic Ink Character Recognition (MICR) Line: Magnetic ink character recognition
(MICR) is a technology used primarily to identify and process checks. The MICR on a check is the
string of characters that appears at the bottom left of the check. It consists of three groups of
numbers, including the bank routing number, the account number, and the check number. The MICR
includes, from left, a nine-character routing number, a 12-character account number, and a four-
character check number. It is called a magnetic ink character recognition line in reference to the
print technology that is used to enable a machine to read, process, and record information.
222 Which one of the following is the low-cost liability for a bank? (C-21)
***
Current deposit Fixed deposit
Savings deposit SND
223 To open an account of a Private Ltd. Company, which one o the following documents is not required?
*** (C-21)
Article of Association Certificate of incorporation
Certificate of Commencement None of the above
224 Payment order can be encashed from- (C-21)

***
Drawee branch only Issuing branch only
Payee branch only Any Branches
225 Fixed deposit can- (C-17)
***
Not be withdrawn before maturity Be paid only after maturity
Be withdrawn before maturity All of these
226 Mandate is a- (C-16)
***
Stamped agreement Order of the court of law
Memorandum of Understanding Unstamped letter to the bank
227 Power of Attorney is- (C-17)
*** a Stamped Agreement b Order of the court of law
c Memorandum of understanding d Unstamped Letter to the bank
228 General Lien gives the creditor right to retain………..which have come in his possession. (C-17)
***
a All goods b some goods
c specific goods d none of these
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229 Introduction in opening account is- (C-17)
***
a Optional b Compulsory
c Discretionary d Waived recently
230 X a partner in the firm XYZ co. wants to open a bank account in the firms name. Then it requirs
*** signature of- (C-17)
a All partners b Any one of the partners
c Managing Partner only d Sleeping partner not required
231 ATM password should be kept in- (C-17)
***
Personal Diary Office diary
Memory All of these
232 ATM can be used for- (C-17)
***
Cash Withdrawal Account enquiry
Statement of account All of these
233 Account payee cheques can be paid- (C-17)
***
At cash counter of Bank At ATM
By deposit in bank account None of above
234 Contents of locker are- (C-17)
***
Only known to hirer Known to Bank
Both a & b Known to head of treasury
235 A cheque transaction means- (C-17)
***
Tearing cheque into two or more pieces Sending the Photostat copy of a cheque in
collection
Using the electronic image of a cheque Keeping the Photostat copy of a cheque in
collectionwith collecting bank before
sending the original cheque to the drawee
branch
236 When a cheque is drawn on a bank, the bank is called the- (C-17)
*** Drawer Endorser
Acceptor drawee
237 Acts done honestly implies acts done- (C-17)
***
Without negligence Rashly
In good faith D. Honourly
238 Mere signature of the payee on the reverse of the instrument is called……….endorsement. (C-17)
***
full Blank
Conditional Restrictive
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239 Payment in due course means- (C-17)
***
Payment on due date Payment in accordance with apparent
tenor
Payment in accordance with apparent Payment due to sufficient fund
signature and specimen
240 Crossing is a direction to the ……..bank to pay the cheque to the payee through a bank (C-17)
*** Drawer Payee
paying Collecting
241 Which of the following is the component of BACH? (C-17)
*** EFT BACPS
Both EFT & BACPS None of these
242 The process of comparing the bank’s balance of an account with the company’s balance and
*** explaining any differences to make them agree is called- (C-16, 17)
Bank statement Bank statement of demand
Bank reconciliation Statement of debit-credit summations
243 Which of the following is the advantage of clearing house? (C-17)
***
Reduce costs Streamline process
Faster reimbursement All of these
244 Which of the following does not fall under paying bank’s due diligence? (C-17)
***
Transmission of posting file Digital certificate Verification of CHM
Verify the prima facie genuineness of the Payment processing
cheque
245 A negotiable instrument payable to order is negotiated by- (C-17)
*** Mere delivery Mere endorsement
Endorsement and delivery By assignment
246 In which of the following cases a banker can disclose the account when they demand for such a
*** disclosure? (C-17)
Wife of his customer An income Tax Officer
Customer as a payee A police Officer
247 The term describing the rate a country’s central bank charges its domestic banks on loans it makes
*** to them is called- (C-17)
Call money rate Bank rate
Repo rate Inter-bank rate
248 Which of the following is not the instrument of money market? (C-17)
***
Treasury bills Bonds
Commercial paper Banker’s acceptances
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Examples of Money Market Instrument: 1. Banker’s Acceptance, 2. Treasury Bills, 3. Repurchase
Agreements, 4. Certificate of Deposits & 5. Commercial Papers.
249 The original as well as duplicate drafts are presented through clearing the same day by two different
*** bank, both marked-‘Payee’s A/C credited’ (C-17)
Original should be paid and duplicate to be Both drafts should be returned
returned
Both to be paid If, duplicate is to be paid the original to be
returned
250 Current Deposits are those which can be withdrawn- (C-16)
***
a At any future date b On demand
c After three months with auto renewal d on a fixed future date
251 Which of the following documents can be accepted by bank as a proof of Customer Identification? C-
*** 16)
Pay slips NID
Income tax assessment order Electricity bill
252 Document/in-operative account means- (C-16)
***
No debits/credit in account for a certain period Dead account without any operation or
long
No debit entries, but certain credit entries for Fixed asset account of the bank
certain period
253 Every teller of a bank branch has a- (C-16)
*** Volt limit Transit limit
Counter limit All of these
254 While Making Payment of a cheque a teller ensures which of the following? (C-16)
*** Date of the cheque Material alteration, if any
Specimen signature of the customer All of these
255 In case of clearing positive pay instruction is required for an individual account where the account is-
*** (C-16)
BDT 1,00,000 and above BDT 3,00,000 and above
BDT 5,00,000 and above None of these
Note: 1. Every individual customer/personal accountholder has to provide a mandatory Positive Pay
Instruction to honor the clearing cheque of BDT 5 Lac & above. 2. Every orporate/
SME/Proprietorship business has to provide a mandatory Positive Pay Instruction to honor the
clearing cheque of BDT 1 Lac & above.
256 If the area of the note of respective denomination is 51%-75% the payable value of that note will be-
*** (C-16)
50% 70%
75% 90%
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Disposal of mutilated note(s): No Claim in respect of a mutilated note shall be entertained unless
the single largest piece of the note presented is more than 50%. Where the single largest piece is
more than 50% the payment shall be made in the following manner, namely:
(i) Full value shall be payable if the area of the note presented is more than 90% of the
respective denomination.
(ii) Proportionate value shall be payable if the area of the not e presented is more than 50%
and less than or equal to 90% of the respective denomination as under: 1. Area of the note of
respective denomination 51% - 75% Payable value of the note of respective denomination 50%. 2.
Area of the note of respective denomination 76% - 90% Payable value of the note of respective
denomination 75%.
257 In one word Teller/cashier may be defined as- (C-16)
***
Flamboyant Blunt
Trustworthy Sensible
258 Teller/cash officer must have friendly ……………..skills. (c-16)
***
Denomination feed
Customer service None of these
259 In banking, ‘ATM’ stands for- (C-16)
***
Any time money Automatic transaction machine
Automated teller machine None of these
Automated Teller Machine (ATM): An automated teller machine (ATM) is an electronic banking
outlet that allows customers to complete basic transactions without the aid of a branch
representative or teller. Anyone with a credit card or debit card can access cash at most ATMs. ATMs
are convenient, allowing consumers to perform quick self-service transactions such as deposits, cash
withdrawals, bill payments, and transfers between accounts. Fees are commonly charged for cash
withdrawals by the bank where the account is located, by the operator of the ATM, or by both. Some
or all of these fees can be avoided by using an ATM operated directly by the bank that holds the
account. ATMs were first used in London in 1967, and after 50 years, these machines can be found
nationwide.
260 Which one of the following is the most liquid asset for the bank? (C-16)
***
Cash on hand Investment in Treasury bond
Loans outstanding Cash with other bank
Note: Cash is the most liquid asset as it is already converted into cash which can be used to pay
liabilities immediately.
261 A cheque that is not paid by a bank because of insufficient funds in a customer’s bank account is
*** called- (C-16)
Invalid cheque Outstanding cheque
NSF cheque Marked cheque
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Note: A bounced check is slang for a check that cannot be processed because the account holder has
nonsufficient funds (NSF) available for use. Banks return, or "bounce", these checks, also known as
rubber checks, rather than honoring them, and banks charge the check writers NSF fees.
262 A written promise to pay a specified amount of money on demand or at a definite time is called- (C-
*** 16)
Bill of Exchange Cheque
Draft Promissory note
263 A banker on whom a cheque is drawn by the customer is called- (C-16)
***
Collecting Bank Paying bank
Drawee Bank Both (b) & ©
264 POS stands for- (C-16)
***
Punch out shift Price of surplus
Point of sale None of these
Generally, Point of Sale(POS) or Point of Purchase(POP) means the place where a transaction
between a customer and a merchant takes place. The merchant may make an invoice and after
taking the cash from the buyer a receipt is given. After inventing computer, POS system was digitized
at first in the 1970s. Mobile phones and tabs of the 21st century have added a new dimension in
Point of Sale(POS) revolution. Programming and software have created a new system popularly
known as Point of Sale(POS) system.
Point of sale (POS), a critical piece of a point of purchase, refers to the place where a customer
executes the payment for goods or services and where sales taxes may become payable. It can be in
a physical store, where POS terminals and systems are used to process card payments or a virtual
sales point such as a computer or mobile electronic device.
A point of sale (POS) is a place where a customer executes the payment for goods or services and
where sales taxes may become payable.
A POS transaction may occur in person or online, with receipts generated either in print or
electronically. Cloud-based POS systems are becoming increasingly popular among merchants.
POS systems are increasingly interactive, particularly in the hospitality industry, and allow customers
to place orders and reservations and pay bills electronically.
265 The practice of and procedures for moving cash from multiple banks into a firm’s centralized bank
*** account is known as: (C-16)
Cash concentration Float management
Strategic cash disbursement Payable management
266 ATM can be used for- (C-16)
*** Local area network Wide area network
Both (a) & (b) None of these
267 PIN in a ATM card is: (C-16)
***
Permanent Information Number Personal Identification Number
Professional Identification Number Permanent Identification Number
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268 Mr. X has a bank account and credited Tk.20 lac in it. Subsequently he has arrested on charge of
*** fraud. The police informed the bank for not allowing withdrawals from his account. Two days later,
bank receives a cheque of Tk.50,000.00 favouring Mr. X’s creditor. What should the bank do? (C-16)
Should not pay the cheque Return the cheque with memo stating
account holder is in jail
Honour the cheque Wait for the court order
269 Account holder Mr. Y draws a cheque for tk.5000 favouring Z(who is a minor aged 13 years) or
*** bearer. Z presents the cheque over the counter duly sign on the back. What should the banker do
with the cheque of a minor? (C-16)
Refuse, since no contractual capacity Pay the cheque after inquiring with Mr. X
Pay to Z without any responsibility of bank Ask Z to bring parents
270 In which circumstances, the banker is entitled to disclose the information of the customer’s account?
*** (F-19)
Legal binding Consent of the customer
Garnishee order All of these
271 If a cheque is drawn “Payable to Farhad” it means (E-14)
***
Farhad can further negotiate or transfer the Farhad can further negotiate or transfer
cheque to another person by delivery the cheque to another person by
endorsement & delivery
Cheque can be paid to Farhad only None of these
272 Which of the following should be the basic contract of loan review? (E-20)
***
a Credit quality b Documentation and liquidation of collateral
c Compliance with loan policy, laws and d All of these
regulation
273 For a trading concern which of the following is the most important performance indicator? (E-20, F-
*** 16, 18, 17)
a Inventory Turnover b Fixed Asset Turnover
c Safety Margin d Debt coverage ratio
What Is Inventory Turnover: Inventory turnover is a financial ratio showing how many times a
company has sold and replaced inventory during a given period. A company can then divide the days
in the period by the inventory turnover formula to calculate the days it takes to sell the inventory on
hand.
Calculating inventory turnover can help businesses make better decisions on pricing, manufacturing,
marketing, and purchasing new inventory.
274 In managing NPL, preventive and resolution measure may be the basic strategy. Which of the
*** following is not true about preventive measure? (E-20)
Which of the following is not true about preventive measures of managing NPA? (E-19, F-18)
a Screening b Surveillance
c Debt restructuring d Legal Action
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275 Bank rate is the rate at which (F-19, 20)
***
BB lend to the public A bank lends to the public
BB gives credit to commercial banks GOB lends to other country
Definition: Bank rate is the rate charged by the central bank for lending funds to commercial banks.
Description: Bank rates influence lending rates of commercial banks. Higher bank rate will translate
to higher lending rates by the banks. In order to curb liquidity, the central bank can resort to raising
the bank rate and vice versa.
276 Capital formation in an economy depends on- (F-19)
*** Total savings Total production
Total Income Total demand
Main Stages of Capital Formation/Economy:
1. Creation of savings: Capital formation depends on savings. Saving is that part of national income
which is not spent on consumption goods. Thus, if national income remains unchanged more saving
implies less consumption. In other words, in order to save more and more people have to curtail
their consumption voluntarily. If people reduce their consumption savings will increase. If
consumption falls some resources used in the production of consumption goods will be released.
2. Conversion of savings into investment: However, generation of savings is not enough. Often
people save money but this saving largely goes waste because saving is hold in the form of idle
balance (as in rural areas), or to purchase unproductive assets like gold and jewellery. This is why
society’s actual savings falls below its potential savings.
3. The actual production of capital goods: This stage involves the conversion of money-savings into
the making of capital goods, or what is known as investment. The latter, in turn, hinges on the
existing technical facilities available in the country, existing capital equipment, entrepreneurial skill
and venture, rate of return on investment, rate of interest, government policy, etc.
277 Discounted cash flow technique are that following except (E-20)
*** a Net present value b Regular pay back period
c Internal rate of return d Profitability Index
Note: A lot of people get confused about discounted cash flows (DCF) and its relation or difference
to the net present value (NPV) and the internal rate of return (IRR). In fact, the internal rate of return
and the net present value are a type of discounted cash flows analysis. Both the NPV and the IRR
require taking estimated future payments from a project and discounting them into the Present
Value (PV). The difference in short between the NPV and the IRR is that the NPV shows a projects
estimated return in monetary units and the internal rate of return reveals the percentage return
needed to break even. In fact the IRR is the return needed for the NPV to hit 0. Further analysis of
the difference between the NPV vs IRR can be found in the article NPV vs IRR.
278 Which of the following should be the prime function of bank supervisor? (E-20)
*** a Establishing a risk based legal and regulatory b Monitoring risk management in banks
framework
c Appoint key players in the corporate d Set policies at the bank level
governance
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279 Suppose the XYZ Bank has assets with duration of 6.5 years and liabilities with duration of 3.0 years.
*** This bank has Tk.200 million. What is assets and Tk. 180 million in liabilities. What is the
leverage duration gap of this bank? (E-20)
a 6.50 years b 3.50 years
c 4.75 years d 3.80 years
FORMULA: DGPAK=DA-(DL*TL/TA), DGPAK= 6.50 (3.00*180/200), DGPAK=6.50-(3.00*0.90),
DGPAK=6.50-2.70, DGPAK=3.80
280 Most commonly used analysis is strategic planning of organization is SWOT analysis. It consists of (E-
*** 20)
a Support, work load, organization, threats b Strengths, work load, opportunities, threats
c Strengths, weakness, opportunities, threats d Support, weakness, organization, threats
What Is SWOT Analysis: SWOT (strengths, weaknesses, opportunities, and threats) analysis is a
framework used to evaluate a company's competitive position and to develop strategic planning.
SWOT analysis assesses internal and external factors, as well as current and future potential.
A SWOT analysis is designed to facilitate a realistic, fact-based, data-driven look at the strengths and
weaknesses of an organization, initiatives, or within its industry. The organization needs to keep the
analysis accurate by avoiding pre-conceived beliefs or gray areas and instead focusing on real-life
contexts. Companies should use it as a guide and not necessarily as a prescription.
281 A technique that is used in comparative analysis of financial statement is (E-20)
*** a Graphical analysis b Preference analysis
c Common size analysis/vertical analysis d Returning analysis
Note: A technique uses in comparative analysis of financial statement is common size analysis.
Common size, or vertical analysis, is a method of evaluating financial information by expressing each
item in a financial statement as a percentage of a base amount for the same time period. A company
can use this analysis on its balance sheet or its income statement.
282 Method of stock valuation which is multiple of earnings per share, book value and net
*** income is classified as (E-20)
a Stock multiple analysis b Dividend multiple analysis
c Market multiple analysis d Stock and multiple analysis
Note: Method of stock valuation which is multiple of earning per share, book value and net income is
classified as market multiple analysis. A market multiples analysis is a financial modeling method of
assigning a value to assets or to a business.
283 In cash flow estimation the depreciation is considered as (E-20)
***
a Cash charge b Cash flow discount
c Noncash charge d Net salvage discount
Note: In cash flow estimation, depreciation is considered as noncash charge. A company will take a
non-cash charge against non-cash items on the balance sheet, such as depreciation, amortization,
and depletion. These charges are typically made when something unusual happens, often outside
the control of the company.
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284 Liquidity ratio is a type of ratio which is used to analyze capacity of company to meet its short term
*** Liabilities. It contains (EO-2020)
a Quick ratio, debt ratio, cash ratio, current ratio b Quick ratio,current ratio, cash ratio,
operating cycle ratio
c Quick ratio,current ratio, cash ratio, cash d Quick ratio,cash ratio, inflation ratio,
conversion ratio current ratio
What Are Liquidity Ratios: Liquidity ratios are an important class of financial metrics used to
determine a debtor's ability to pay off current debt obligations without raising external capital.
Liquidity ratios measure a company's ability to pay debt obligations and its margin of safety through
the calculation of metrics including the current ratio, quick ratio, and operating cash flow ratio.
285 Poor cash flows create problems for organization in long run. It includes (E-20)
*** a Merger credit mechanism b Lack of budgeting
c Unanticipated demand of cash d Drawing by the owner
286 Inventory is listed as a part of current asset. Stock or inventory in an organization means (E-20, F-19,
*** 20)
a Goods that are readily available for sale b All the assets available for sale
c All the raw material, Semi finished and the d Goods that can be sold within a short span
finished goods in the organization of time
287 Time period for one complete operating cycle is equivalent to sum of all steps involved while
*** subtracting the (E-20)
a Credit period given by the traders or suppliers b Loanused for the manufacturing process
c Dividend pay to the shareholders d Current liabilities of the company
288 Which one of the following is an intangible asset? (C-21)
*** Copyright Computer
Land Taka
289 Which one of the following is an intangible asset? (E-20, F-17, C-16)
*** a FDR b Goodwill
c Inventory d Land and building
Intangible asset: Goodwill (F-16), Copyright, Trademark, Franchise Agreements, Patentes, Logo,
Brand Value, Self-developed softwares, Customer Data.
Tangible Assets: Land & Building, Cash, Furniture, Plant and Machinery, Vehicles, Stock, Equipment,
Computers, Inventory, Bonds.
290 Which of the following is/are institutional key player in banking risk management? (E-20)
***
a Regulatory authority b Shareholders
c Internal Auditors d Both (b) and (c)
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291 Which of the following is not a feature of credit derivative? (E-20)
***
a Offering protection against credit loss b Banks lead the credit derivative market
c Minimize adverse selection problems of banks d Opportunity of further spread out risk
292 A project loan will be accepted when? (E-20, 16, F-16, 17)
***
a IRR is 10% b NPV is negative
c NPV is positive d None of these
What Is Net Present Value (NPV): Net present value (NPV) is the difference between the present
value of cash inflows and the present value of cash outflows over a period of time. NPV is used in
capital budgeting and investment planning to analyze the profitability of a projected investment or
project. NPV is the result of calculations used to find today’s value of a future stream of payments.
293 The minimum percentage of Capital to RWA (Risk Weighted Asset) ratio (CRAR) Capital to Risk-
*** Weighted Asset Ratio that to be maintained by Banks as prescribed by Bangladesh Bank is -(E-20, 19)
a 7 b 8
c 9 d 10
Limits (Minima and Maxima):
i. Common Equity Tier 1 of at least 4.5% of the total RWA
ii. Tier 1 capital will be at least 6.0% of the total RWA
iii. Minimum CRAR of 10% of the total RWA
iv. Additional Tier 1 capital can be admitted maximum up to 1.5% of the total RWA or 33.33% of
CET1, whichever is higher9
v. Tier 2 capital can be admitted maximum up to 4.0% of the total RWA or 88.89% of CET1,
whichever is higher
vi. In addition to minimum CRAR, Capital Conservation Buffer (CCB) of 2.5% of the total RWA is
being introduced which will be maintained in the form of CET1
294 Which of the following is termed as earning asset? (E-20, 16, F-16, C-17, F-17)
***
a Deposit/Borrowing b Cash & liquid reserve
c Investment (E-20)/Loans and advance (C-17) d Capital
What Are Earning Assets: Earning assets are income-producing investments that are owned, or held,
by a business, institution or individual. These assets also have a base value and the ability to produce
additional funds beyond the inherent value for the investment holder. This allows the investment
holder to maintain the assets as a source of earnings or sell the assets for a lump sum based on the
inherent value.
Understanding Earning Assets: Earning assets include stocks, bonds, income from rental property,
certificates of deposit (CDs) and other interest or dividend earning accounts or instruments. They can
provide a steady income, which makes particularly useful for long-term goals such as retirement
planning. Earning assets are a reflection of only part of the total assets of an individual or institution.
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295 The financial statement that reports assets, liabilities and stockholder’s equity is treated as (EO-20)
*** a Statement of cashflow b Balance Sheet
c Retained earnings statement d Income statement
296 Which of the following constitute liability for the bank? (C-16)
***
Cash receivable Petty cash
Outstanding pay order Outstanding loans and advance
297 Which one of the following is a liability for the bank (E-20, F-20, 18)
***
a Motor vehicles b Creditors for suppliers
c Office equipment d Cash at bank
298 Which one(s) of the followings is symptoms of a non performing project (E-19, 17, 18)
***
a Slow turnover b Under utilization of capacity
c Going out of production d All ofthese
299 Which one is not the irregularity in case of approving loans & advances? (E-19, 16, 17, 18)
***
a Over or under invoicing b Inadequate security stipulation
c Undue influence d Estimation of the cost of the project and
means of finance
Categories of Loans and Advances:All loans and advances will be grouped into four (4) categories for
the purpose of classification, namely- (a) Continuous Loan (b) Demand Loan (c) Fixed Term Loan and
(d) Short-term Agricultural & Micro- Credit.
300 Any continuous loan will be classified as “Doubtful" if it is past due\overdue for (E-19)
***
a If it is past due/overdue for 03 months or b If it is past due/overdue for 06 months or
beyond but less than 06 months beyond but less than 09 months
c If it is past due/overdue for 09 months or d None of This
beyond
301 Down payment requirement of term loan for the second time rescheduling is-(E-19)
*** a 10% of the total outstanding or 15% of the b 20% of the total outstanding or 30% of the
overdue installment of the loan, whichever is overdue installment of the loan,
less whichever is less
c 10% of the total outstanding or 25% of the d None of these
overdue installment of the loan, whichever is
less
302 Purpose of the financial statement analysis is/are- (E-19)
*** a Assessment of past perfomance b Assessment of current position
c Forecasting profitability & growth prospects d All of These
303 In case of credit which of the following issues does not fall under uncontrollable Factor?(E-19)
*** a Natural calamities b Lack of clear records
c Government policies d Slowdown in the growth of national
economy
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304 The ICRR consists of …….. Notehed rating system covering quantitative and qualitative Parameters-
*** (E-19)
a 3 b 5
c 4 (Excellent+Good+Marginal+Unacceptable) d 6
Note: 1. Green/Excellent, 2. Blue/Good, 3. Yellow/Marginal, 4. Red/Unacceptable.
305 Components of costs are the following except- (E-19)
*** a COF (cost of funds) & COA (chart of accounts) b CRR (Cash reserve ratio) & SLR (Statutory
Liquidity Ratio)
c Opportunity Cost d Cost of equity capital and Risk Premium
306 The discount rate that sets the net present value of an investment equal to zero is called- (E-19)
*** a NPV (net present value) b BCR (benefit-cost ratio)
c IRR (internal rate of return) d Discounted Payback
307 IRR (Internal rate of return) is the discount rate at which (E-18)
*** Internal rate of return (IRR) is: (E-19, 17, F-19, 20, AR)
a NPV>0 b NPV < 0
c NPV (Net Present Value) =0 d NPV >1
308 Economic aspect of project analysis includes the following except- (E-19)
*** a Contribution to GDP b Impact on Environment
c Employment generation d Indirect benefit of the society
309 The Ratio that measure the ability of a company to generate cash to pay interest and principal
*** repayments is called- (E-19)
a Activity Ratio b Liquidity Ratio
c Coverage Ratio d Leverage Ratio
310 In case of ratio analysis comparison can be made on a number of different bases except (E-19)
***
a Inter company basis b Specific ratio basis
c Intra company basis d Industry average basis
311 Components of Financial Statements are the following except- (E-19)
***
a Balance Sheet b Financial Performance in trems of the profit
or loss
c Vault position of Cash and bank balance d Retained earnings or changes in equity
312 Objective of Retail Banking are the following except- (E-19)
*** a To extend credit facility to the fixed income b To concentrate on a particular credit
group portfolio
c To intorduce and carry out collateral free d To participate in the socio-economic
credit operation development of the country
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313 Which of the following is non funded credit E-19, 17, C-21, 17)
***
a CC pledge/Overdraft/LTR b Bill purchase and discounting
c Letter of credit/Guarantee (E-19) d Both (b) and ©
314 Which of the following facility is funded? (E-14)
***
Bank guarantee LBPD (Local Bill Purchase & Discount)
Acceptance SLC/ULC
Note: Non-funded facilities are those financing facilites in which bank has no direct exposure of its
funds. Instead of direct involvement of funds, bank facilitates a cerain transaction. The examples of
non-funded facility could be Letter of credit, Letter of guarantee, performance bond, bid bond, etc.
315 In respect of advance granted to a partnership firm, the security documents obtained should be
*** signed by (E-19)
a All the partners jointly b Any one of the partners if the account is to
be operated by any one partner
c All the partners of the firm jointly on behalf of d All of the these
the firm and also in their individual capacity
316 Which among the following statements is not true when there is an increase in interest rate in an
*** economy (F-19)
Increase in savings Decrease in loan
Increase in capital return Increase in production cost
317 Which one is not included in funded credit? (F-18)
***
Term loan Documentary credit
Lien Packing Credit
318 The value of working capital depends on (E-19, F-18)
***
a The length of operating cycle b Conversion of inventory in to receivables
c Conversion of receivables in to cash d Conversion of cash in to inventory
319 Leverage risk can be assessed by (E-19, 18)
*** a Quick ratio b Debts service coverage ratio
c Interest coverage ratio d Debt Equity ratio (Short Term Debt+Loan
Term Debt+Others Fixed Payment-Share
Holder Equity)
320 Which one is not associated with fraud? (E-16, 17, C-16)
***
a Deception b Concealment
c Promise d Unethical conduct
321 Credit rating indicates which of the following of a company E-19)
***
a Overall efficiency b Management efficiency
c Financial status d All of these
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Note: A credit rating is an evaluation of the credit risk of a prospective debtor (an individual, a
business, company or a government), predicting their ability to pay back the debt, and an implicit
forecast of the likelihood of the debtor defaulting.
322 The process of reducing debt through regular installment payments of principal and interest that will
*** result in the pay off of a loan at its maturity is called- (EO-2019)
a Annuity b Amortization
c appropriation d None of This
Note: Amortization is the process of spreading out a loan into a series of fixed payments over time.
You'll be paying off the loan's interest and principal in different amounts each month, although your
total payment remains equal each period. ... Reducing your loan balance (also known as paying off
the loan principal).
323 Current ratio means (E-18, 17)
*** Current ratio is calculated through
a CA-CL b Current Assets/Current Liabilities
c TL/NW d None of these.
Note: Current ratio is a comparison of current assets to current liabilities, calculated by dividing your
current assets by your current liabilities. Potential creditors use the current ratio to measure a
company's liquidity or ability to pay off short-term debts.
324 The present interest rate of agricultural lending fixed by Bangladesh Bank is (E-18)
*** a 8% b 9%
c 10% d 11%
Note: Bangladesh Bank slashed the interest rate for agricultural loans to 8% from the previous 9% for
ensuring more disbursement of low-cost loans in the agriculture sector and boost production amid
the Covid-19 pandemic. The new interest rate would be effective from April 01, 2021.
325 Which ofthe following is not the source of credit information (E-18)
***
a Loan application b Financial statements
c CIB d Execution of documents
326 Neither possession nor ownership is transferred to the lender in case of (E-18, 16, F-16, 17, G)
***
a Pledge b Mortgage
c Hypothecation d All of these
Note: Hypothecation is a Charge against property for an amount of debt where neither ownership
nor possession is passed to the creditor.
Being only an equitable charge on moveable property without possession, hypothecation facility is
granted only to parties of undoubted means with the highest integrity.
327 From the bankers' point of view what should be the objective to identify the project? (E-18)
*** a To ensure repayment b To achieve organizational goal
c To create investment opportunity d All of these
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328 Down payment requirement of term loan for the 1st time rescheduling is (E-18, 16, 17)
***
a 10% of the total outstanding or 15% of the b 20% of the total outstanding or 30% of the
overdue installment of the loan whicheveris overdue installment of the loan
less. whicheveris less
c 10% of the total outstanding or 25% of the d None of these.
overdue installment of the loan whicheveris
less
329 Execution suit under Artha rin adalat Ain 2003 should be filed within (E-18, 17, 16)
*** Specify the period of time when filing of 2nd Execution Case barred by Law/Execution of suit is
barred by limitation (AR)
a 120 days b 180 days
c 360 days/1 Year d None of these
330 General provisioning requirement for special mention accountis (F-18)
*** Maintenance of general provision and SMA in case of Consumer Finance Scheme is – (E-18, 16)
a 5% on the outstanding amount of loans b 2% on the outstanding amount of loans.
c 0.25% on the outstanding amount of loans. d 1% on the outstanding amount of loans.
331 General provisioning requirement for off balance sheet item is (E-17, 15)
*** a 5.00% of limit b 0.05% of limit
c 1.00% of limit (As Per BRPD Circular No. 07, 21 d 0.15% of limit
June 2018)
332 Which one of the following is not the capital budgeting technique? (E-18, 17)
***
a Discounted payback period b NPV
c Break even analysis d IRR
Capital budgeting technique: 1. Payback method, 2. Net present value method (better method), 3.
Internal rate of return method
Capital budgeting is important because it creates accountability and measurability. Any business that
seeks to invest its resources in a project without understanding the risks and returns involved would
be held as irresponsible by its owners or shareholders.
Capital budgeting is very important for any business as it impacts the growth & prosperity of the
business in the long term. It creates accountability & measurability. Some of the popular techniques
are net present value, internal rate of return, payback period, accounting rate of return &
profitability index.
333 Based on Capital budgeting technique decision rule, which project should be chosen for investment?
*** (F-18, E-17)
a The project having NPV greater than zero b The project having payback period greater
than given standard time
c The project having IRR lower than the cost of d Anyone
capital
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334 Which of the following tools of financial(s) statement analysis is used for ............a series of financial
*** statement data over a period of time (E-18)
a Vertical analysis b Ratio analysis
c Horizontal analysis d Both(a) & (b)
Tools of Analysis: 1. Horizontal Analysis: Horizontal analysis, also called trend analysis, is a
technique for evaluating a series of financial statement data over a period of time. i). Purpose is to
determine the increase or decrease that has taken place. ii). Commonly applied to the statement of
financial position, income statement, and retained earnings statement.
Tools of Analysis: 2. Vertical Analysis: Vertical analysis, also called common-size analysis, is a
technique that expresses each financial statement item as a percent of a base amount. i). On an
income statement, we might say that selling expenses are 16% of net sales. ii). On a statement of
financial position, we might say that current assets are 22% of total assets. iii). Vertical analysis is
commonly applied to the statement of financial position and the income statement.
Tools of Analysis: 3. Ratio Analysis: Ratio analysis expresses the relationship among selected items
of financial statement data. Financial Ratio Classifications: i). Liquidity: Measure the short-term
ability of the company to pay its maturing obligations and to meet unexpected needs for cash., ii).
Profitability: Measure the income or operating success of a company for a given period of time. iii).
Solvency: Measure the ability of the company to survive over a long period of time.
335 If the net profit of a firm is BDT 2.5 million and the total asset is BDT 10 million the return on asset
*** (ROY) of the firm is-(E-18)
a 0.20% b 0.25%
c 0.40% d None of these
Note: Return on Assets (ROA): Net Income/Average Total Assets
336 Basic purpose of commodity exchange is (E-18)
*** a Market discovery b Cost discovery
c Price discovery d Profit discovery
What Is Price Discovery: Price discovery is the overall process, whether explicit or inferred, of setting
the spot price or the proper price of an asset, security, commodity, or currency. The process of price
discovery looks at a number of tangible and intangible factors, including supply and demand,
investor risk attitudes, and the overall economic and geopolitical environment. Simply put, it is
where a buyer and a seller agree on a price and a transaction occurs.
337 Which of the following is known as horizontal analysis (F-18)
***
common size analysis Ratio Analysis
Scenario Analysis trend analysis
Note: On the other hand, horizontal analysis looks at amounts from the financial statements over a
horizon of many years. Horizontal analysis is also referred to as trend analysis.
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338 The financial statement that report assets, liabilities and stock holders equity is..........as- (E-18)
***
Asset Liability of a firm for a particular year is shown in the- (F-16, 17)
a Income statement b Retained earnings statement
c Balance sheet d Statement of cash flows
339 Which of the following is not the direct green finance (E-18)
***
a Bio-gas plant b Projects financed having PTP
c Solar panel / renewable energy plant d Bio-fertilizer plant
340 Bank contribute in the form of- (F-20)
***
Economic aspect includes (E-18)
a Contribution to GDP b Creation of employment
c Indirect benefit to the society d All of these
341 The following are the steps of documentation except (E-18)
*** a Drafting of documents b Filling and execution of documents
c Witnessing, stamping and registration d Maintaining proper security
342 Banker can get an idea about the payment behavior of a borrower through (E-20)
*** An example of cash flow from investment activity is (E-19, E-18)
a Receipt of cash from the issuance of bond b Payment of cash to purchase outstanding
payable capital stock
c Receipt of cash from the sale of equipment d Payment of cash to suppliers for inventory
Examples of Investing Activities: When a company makes long-term investments in securities,
acquires property, equipment, vehicles, or it expands its facilities, etc., it is assumed to be using or
reducing the company's cash and cash equivalents.
343 A banker can get an idea about the payment behavior of a client/borrower through (E-20, 19, 18, F-
*** 18)
a Accounts payable turnover ratio (E-20) b Receivable turnover ratio
c Debt-service coverage ratio d None of these
344 In a capitalistic economy, the prices are determined by- (F-19)
*** Buyers in the market Govt. Authorities
Sellers in the market Demand and supply
Note: The price of a product is determined by the law of supply and demand. Consumers have a
desire to acquire a product, and producers manufacture a supply to meet this demand. The
equilibrium market price of a good is the price at which quantity supplied equals quantity
demanded. Graphically, the supply and demand curves intersect at the equilibrium price.
345 In calculation of net cash flow, depreciation and amortization are treated as- (F-20)
*** current liabilities non-cash revenues
income expenses non-cash charges
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Note: In calculation of net cash flow, depreciation and amortization are treated as non-cash charges.
A non-cash charge is a write-down or accounting expense that does not involve a cash payment.
346 When does a person become insolvent (F-19)
*** When he left with no property at his own When he declares an insolvent by the
court
When he terminates from a job he was holding When he declares himself to be an
insolvent
347 Identify the punishable offence by a bank account holder-(F-19, 20)
*** If a cheque is not crossed If a post-dated cheque is issued
If a cheque drawn by him is dishonoured for Issuing a cheque without signature
insufficiency of funds in his account
348 Company’s ratios are compared with industry’s ratio to get a clear view about company’s
*** performance recommended current ratio is-(F-19, 20)
(1:3) (3:1)
(1:2) (2:1)
349 Amount of cash to be held by entity depends on which of the following factors? (F-19, 20)
*** Inventory, liquid assets, working capital and Size of the entity, expected risks, assets,
size of the entity working capital and efficiency of
operational staff
Expected future cash flows, liquid assets, Liquid assets, liabilities, inventory and size
expected risks and borrowing capacity of the of the entity
entity
350 Line of credit is a term frequently used in business terminology. It refers to- (F-19, 20)
***
The use of credit facility in the operational The maximum amount of loan an
activities organization can avail
The basis on which credit can be utilized The limits set for acquiring credit
What Is a Line of Credit (LOC): A line of credit (LOC) is a preset borrowing limit that can be tapped
into at any time. The borrower can take money out as needed until the limit is reached, and as
money is repaid, it can be borrowed again in the case of an open line of credit.
A LOC is an arrangement between a financial institution—usually a bank—and a client that
establishes the maximum loan amount the customer can borrow. The borrower can access funds
from the line of credit at any time as long as they do not exceed the maximum amount (or credit
limit) set in the agreement.
351 Ratios are mathematical indicators which are calculated by comparing two values. Financial ratios
*** help in- (F-19, 20)
Estimating the company’s gross profit Understanding the financial workings of the
company
Analyzing the financial statements Understanding the internal working
structure of the company
What Is Ratio Analysis: Ratio analysis is a quantitative method of gaining insight into a company's
liquidity, operational efficiency, and profitability by studying its financial statements such as the
balance sheet and income statement. Ratio analysis is a cornerstone of fundamental equity analysis.
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352* Advising of a credit an amendment signifies? (F-20)
**
Genuiness of a credit and amendment Complete authenticity and accurate
advisied. reflection of them and condition of the
credit / amendment advise.
Apparent authenticity and accurate reflection All of the Above
of them and condition of the credit /
amendment advise.
353 Banks have new possibilities to manage credit concentrations and other portfolio issues including all
*** of the following mechanisms except- (F-19)
Loan sales Credit derivatives
Securitization programs Primary loan markets
Note: Banks have new possibilities to manage credit concentrations and other portfolio issues. These
include such mechanisms as loan sales, credit derivatives, securitization programs and other
secondary loan markets.
354 Which of the following is used as the highest layer in credit approval processes? (F-19, 20)
*** Source of cash flows Value and type of collateral
Type of borrower Amount and type of claim
Note: In general, type of borrower is used as the highest layer in credit approval processes.
355* Although the treatments of collateral, netting and credit derivatives and guarantees are based on
** similar concepts, which of the following are different? (F-19)
Quality weighting schemes Risk weighting schemes

Explicit weighting schemes Temporal weighting schemes
Note: Although the treatments of collateral, netting and credit derivatives and guarantees are based
on similar concepts, the risk weighting schemes are different.
356 Which of the following incorporates not only economic data but also qualitative information
*** concerning the borrower? (F-19, 20)
Credit approval Credit review
Credit score Credit history
Note: The credit review incorporates not only economic data but also qualitative information
concerning the borrower.
357 Which of the following maps into a risk weight lower than that which applies to an unrated claim? (F-
*** 19)
High quality credit assessment Low quality assessment
Moderate quality credit assessment Weak quality assessment
Note: A high quality credit assessment is the one which maps into a risk weight lower than that
which applies to an unrated claim.
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358 Which of the following is an important tool in monitoring and controlling credit risk? (F-19, 20)
***
Holistic Rating Interval Rating
Internal risk ratings Analytical Risk.
Note: The authority considers the use of an internal risk rating system as an important tool in
the monitoring of the quality of individual credits as well as the total portfolio. A well -
structured internal risk rating system is a good means of differentiating the degree of
credit risk in the different credit exposures. This allows a more accurate determination
of the overall characteristics of the credit portfolio, concentrations, problem credits, and
the adequacy of the loan los s reserves.
359 Although the treatment of collateral, netting and credit derivatives and guarantees are based on
*** similar concepts, which of the following are different? (F-19)
Quality weighting scheme Risk weighting scheme
Explicit weighting scheme Temporal weighting scheme
Note: The approach to CRM techniques is designed to focus on economic effect. However, collateral,
netting and guarantees/credit derivatives typically have different risk characteristics. For example,
collateral represents ìfundedî protection whereas guarantees and most credit derivatives are
ìunfundedî. 12 Furthermore, whereas collateral instruments are subject to market risk, guarantees
are not. Finally, credit derivatives are more likely than collateral to be subject to maturity or asset
mismatches. Hence, although the treatments of collateral, netting and credit derivatives and
guarantees are based on similar concepts, the risk weighting schemes are different.
360 Which of the following processes should be conducted on a periodic basis to determine that credit
*** activities are in compliance with the bank’s credit policies and procedure? (F-19)
External audits of the credit risk Internal audits of the credit risk
Financial audits of the credit risk Performance audits of the credit risk
Note: Internal audits of the credit risk processes should be conducted on a periodic basis to
determine that credit activities are in compliance with the bank’s credit policies and procedures, that
credits are authorized within the guidelines established by the bank’s board of directors and that the
existence, quality and value of individual credits are accurately being reported to senior
management.
361 Who issues ‘Commercial Papers’? (F-19)
***
A company to a Bank Banks to Banks
Banks to Companies Company to its suppliers
Note: Commercial paper (CP) is a short term money-market security issued/sold by usually large
corporations for financing working capital such as account receivables and inventories. Commercial
Paper (CP) is defined as a secured/ unsecured promissory note which has an original maturity
between a minimum of seven days and a maximum of one year.
362 Which one of the following is the ratio of the loan principal to the appraised value? (F-19, 20)
*** Combined Loan To Value: (CLTV) ratio Loan-to-Value Ratio
Mortgage Loan Statutory Liquidity Ratio
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What Is the Loan-to-Value (LTV) Ratio: The loan-to-value (LTV) ratio is an assessment of lending risk
that financial institutions and other lenders examine before approving a mortgage. Typically, loan
assessments with high LTV ratios are considered higher risk loans. Therefore, if the mortgage is
approved, the loan has a higher interest rate.
363 ALM approach emphasize more on (E-20, F-19)
*** a Asset management b Liability management
c Liquidity management d Coordinated approach to assets and
liabilities
Note: Asset and liability management (often abbreviated ALM) is the practice of managing financial
risks that arise due to mismatches between the assets and liabilities as part of an investment
strategy in financial accounting.
ALM sits between risk management and strategic planning. It is focused on a long-term perspective
rather than mitigating immediate risks and is a process of maximizing assets to meet complex
liabilities that may increase profitability.
ALM includes the allocation and management of assets, equity, interest rate and credit risk
management including risk overlays, and the calibration of company-wide tools within these risk
frameworks for optimization and management in the local regulatory and capital environment.
364 Which of the following is the first step in the risk management process? (F-19, 20)
*** Select the appropriate techniques for handling Identify potential losses
losses
Implement and administer the program Evaluate potential losses
Risk management process involves: (i)Risk identification, (ii)Risk assessment (iii)Risk measurement &
Analysis (iv)Risk evaluation (v)Risk treatment (vi) Risk monitoring & Review Risk identification forms
the basis for the development of risk management and control.
365 Value which converts series of equal payments in to value received at beginning of investment is
*** classified as- (F-19, 20)
present value of annuity future value of annuity
decreased value of annuity increased value of annuity
Note: Value which converts series of equal payments in to value received at beginning of investment
is classified as present value of annuity. An annuity is a financial product that pays out a fixed stream
of payments to an individual. Annuities exist first in an accumulation phase, whereby investors fund
the product with either a lump-sum or periodic payments.
366 If contribution margin is BDT 12,000/-, total variable cost is BDT 7,000/-, then total revenue will be-
*** (F-19, 20)
BDT 5,000/- – BDT 5,000/-
BDT 19,000/- – BDT 19,000/-
Note: Total revenue = Contribution margin + Total variable cost= 12000+7000 = 19,000.
367 Any continuous loan will be classified as bad & loss- (F-19, 20)
***
If it is past due/overdue for 03 (three) months If it is past due/overdue for 06 (six) months
or beyond but less than 06 (six) months or beyond but less than 09 (nine) months
If it is past due/overdue for 09 (nine) months None of these
or beyond
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368 As regards ratings and aggregate quantitative score in ICRR, which of the following is not true? (F-19,
*** 20)
Aggregate score of 80 or greater is excellent Aggregate score of 70 or greater but less
than 80 is good
Aggregate score of 60 or greater but less than Aggregate score of less than 60 in
75 is marginal unacceptable
369 You observe that a firm’s profit margin in below the industry average, its debt ratio is below the
*** industry average, and its return on equity exceeds the industry average. What can you conclude? (F-
19)
Return on assets is above the industry average. Total assets turnover is above the industry
average.
Total assets turnover is below the industry Both statements a and b are correct.
average.
Note: The Du Pont equation: ROE = (PM)(TATO)(EM). ROE is above average. PM is below average.
EM is below average because a low debt ratio implies a low EM. Therefore, TATO must be higher for
the equation to hold.
370 For the NPV criteria, a project is acceptable if the NPV is ____________, while for the profitability
*** index, a project is acceptable if the profitability index is ___________.(F-19)
Less than zero, greater than the required Greater than zero, greater than one
return
Greater than one, greater than zero Greater than zero, less than one
371 The firm should accept independent projects if (F-19)
*** The payback is less than the IRR The profitability index is greater than 1.0
The IRR is positive The NPV is greater than the discounted
payback
372 Which one of the following is a financial ratio that gives a measure of a company’s ability to meet its
*** financial losses? (F-19, 20)
Cash Reverse Ratio Leverage Ratio
Statutory Liquidity Ratio Loan-to-Value Ratio
Note: It is meant to evaluate a company's debt levels.
373 When a bank uses business performance management software to monitor its performance in
*** differences regions this: (FAVP-2019)
Reduces costs Manages risks

Adds value Creates a new opportunity
374 Which of the following is not the function of RM in loan approval process? (FAVP-2018)
***
Appraisal of financial aspect Personal preparation
Credit Risk Grading (CRG) Credit approval
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375 All of the following must be included in a credit proposal except- (FAVP-2018)
***
Regulatory Compliance Purpose of the credit
Projected financial statement Collateral summary
376 Which of the following is not the function of CAD-(FAVP-2018)
***
Disbursement Documentation
Compliance Custodial duties
377 Marketing aspect of a project broadly involves a critical study of the following except- (F-18)
***
Analyzing demand and supply Estimating market share
Evaluating marketing plan Estimating cost of the project
378 Leverage ratio is calculated mainly to measure –(FAVP-2018)
***
The ability to repay short term obligation How efficiently assets are utilized
Evaluating marketing plan Estimating cost of the project
379 which of the following is not a part of loan structuring-(FAVP-2018)
***
Determining loan price Loan monitoring
Determining Mode of payment Selection of Security
380 Which of the following is not the example of non-legal measure? (FAVP-2018)
***
Arbitration ADR
Debt Restructuring Waiver of interest
381 A company has a negative cash flow from operating activities. What could explain this negativecash
*** flow- (F-18)
High levels of dividend payments The repay mention loan payment
A sudden increase in credit sales A substantial investment in new fixed
assets
382 Banker Can Get an idea about the payment behavior of a borrower through. (F-18)
***
Account Payable turnover rate debt-service coverage ratio
Receivable turnover Ratio none of These
383 Which one of the following is true about loan write-off? (FAVP-2018)
***
100 percent provision is required before write- It is done for cleaning balance sheet
off
Loan amounting taka upto 50,000 can be All of these
written-off without filing suit
384 What is the single borrower funded limit of a bank? (E-14)
***
15% of bank’s capital 25% of bank’s capital
30% of bank’s capital 35% of bank’s capital
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385 Under the Single Borrower Exposure Limit, the Bank may allow non-funded limit to a customer
*** maximum _______of Bank’s capital.
What is the single borrower exposure limit of a bank? (F-18, 16, 17)
a 15% of Bank’s capital b 35% of Bank’s capital
c 25% of Bank’s capital d None of these
386 Single Borrower Exposure Limit is determined on the basis of Capital of the Bank (E-14)
***
387 In ERM (Environmental Risk Management) Guideline all of the following initiatives discussed except
*** (F-18)
EIA EDD
ERR ETP (Effluent Treatment Plant)
388 Economic aspect of a project deals with (FAVP-2018)
***
private cost and benefit social cost and benefit
central bank cost and benefit direct foreign investment and benefit
389 Sensitivity analysis can be useful to know (FAVP-2018)
***
Interaction between factors Investigate the robustness of the model
How profitable the project is compared to All of these
other projects
390 which of the following is true for base for provision calculation (F-18)
***
outstanding loan – balance of interest outstanding loan –balance of interest
suspense suspense-value of eligible securities
outstanding loan-value of eligible securities none of these
391 Loan would be classified as doubtful if (E-17, F-18)
*** a There is a negative net worth and working b Uncertain collateral coverage
capital
c Full recovery depends upon unlikely events d Allof the above
392 Credit portfolio risk arises due to- (F-18)
***
Credit concentration Economic downturn
Wrong structuring Both (a) & (b)
393 Which of the following is not the purpose of credit monitoring- (F-18)
***
Taking timely corrective measure To understand the feasibility
To Prevent fund diversion To ensure compliance with loan
394 Quantitative Credit Control do not include (FAVP-2019, 2020)
***
a Bank Rate b BB Directives
c CRR d Open Market Operations
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395 A Guarantor is liable only when (E-19, 17, F-18)
***
a The principal debtor has defaulted to pay b The creditor has exhausted his remedy
against the principal debtor
c The guarantor is called upon to pay on default d After the expiry of the limitation period of
by the principal debtor guarantee
396 In a contract of guarantee, the liability of the guarantor is: (E-16)
***
a Primary b Always secondary
c Co-extensive with that of Principal debtor d None of these
"Contract of guarantee", "surety", "principal debtor" and "creditor": The Contract Act, 1872, Sec:
126: A "contract of guarantee" is a contract to perform the promise, or discharge the liability, of a
third person in case of his default. The person who gives the guarantee is called the "surety": the
person in respect of whose default the guarantee is given is called the "principal debtor", and the
person to whom the guarantee is given is called the "creditor". A guarantee may be either oral or
written.
Surety's liability: The Contract Act, 1872, Sec: 128. The liability of the surety is co-extensive with
that of the principal debtor, unless it is otherwise provided by the contract.
397 Commercial Paper (CP) is a short term money market security (debt instrument) to obtain fund to
*** meet short term debt obligation ----- A/R,
investment and is backed only by an issuing bank or company promise to pay the face amount on the
maturity date. Specified on the note, CP issued (sold) by –(F-17)
Large corporation unsecured short term Bangladesh Bank
Both
Commercial paper: Commercial paper, in the global financial market, is an unsecured promissory
note with a fixed maturity of rarely more than 270 days. In layperson terms, it is like an "IOU" but
can be bought and sold because its buyers and sellers have some degree of confidence that it can be
successfully redeemed later for cash, based on their assessment of the creditworthiness of the
issuing company.
Commercial paper is a money-market security issued by large corporations to obtain funds to meet
short-term debt obligations (for example, payroll) and is backed only by an issuing bank or company
promise to pay the face amount on the maturity date specified on the note. Since it is not backed by
collateral, only firms with excellent credit ratings from a recognized credit rating agency will be able
to sell their commercial paper at a reasonable price. Commercial paper is usually sold at a discount
from face value and generally carries lower interest repayment rates than bonds due to the shorter
maturities of commercial paper. Typically, the longer the maturity on a note, the higher the interest
rate the issuing institution pays. Interest rates fluctuate with market conditions but are typically
lower than banks' rates.
Commercial paper, though a short-term obligation, is typically issued as part of a continuous rolling
program, which is either a number of years long (in Europe) or open-ended (in the United States).
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398 The rate at which the central bank of a country borrows money from the commercial banks by
*** increasing the rate discourage the public to borrow money and encourage them to deposit is called–
(F-17)
Reverse Repo Rate Bank Rate
Repo Rate
399 The rate of interest charged on short term loan between banks. Banks borrow and lend money
*** among the financial institutions for managing liquidity and satisfy regulation as reserve requirements
may define as– (F-17)
Bank rate Interbank rate
Call Money Rate Repo rate, Reverse Repo rate
Interbank lending market: The interbank lending market is a market in which banks lend funds to
one another for a specified term. Most interbank loans are for maturities of one week or less, the
majority being over day. Such loans are made at the interbank rate (also called the overnight rate if
the term of the loan is overnight). A sharp decline in transaction volume in this market was a major
contributing factor to the collapse of several financial institutions during the financial crisis of 2007–
2008.
Banks are required to hold an adequate amount of liquid assets, such as cash, to manage any
potential bank runs by customers. If a bank cannot meet these liquidity requirements, it will borrow
money in the interbank market to cover the shortfall. Some banks, on the other hand, have excess
liquid assets above and beyond the liquidity requirements, and will lend money in the interbank
market, receiving interest on such loans.
The interbank rate is the rate of interest charged on short-term loans between banks. Banks borrow
and lend money in the interbank lending market in order to manage liquidity and satisfy regulations
such as reserve requirements. The interest rate charged depends on the availability of money in the
market, on prevailing rates and on the specific terms of the contract, such as term length. There is a
wide range of published interbank rates, including the federal funds rate (USA), the LIBOR (UK) and
the Euribor (Eurozone).
400 The rate at which banks borrow from each other is called (E-20, 18)
***
a Call rate b Interbank rate
c Reverse repo rate d Cash rate
Note: The interbank rate is the rate of interest charged on short-term loans made between U.S.
banks. Banks may borrow money from other banks to ensure that they have enough liquidity for
their immediate needs, or lend money when they have excess cash on hand. The interbank lending
system is short-term, typically overnight, and rarely more than a week.
401 The discount rate at which BB borrows Govt. securities from commercial banks is known as (F-19, 20)
*** The rate at which the central bank of a country (BB) lends money (at lower rate) to commercial
banks in the event of any shortfall of funds is called-(F-17)
a Repo rate b Reverse repo rate
c Deposit rate d Base rate
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402 Repo rate is the rate at which- (E-20, 19, F-18)
***
a Banks borrow from the Bangladesh b Bank Land and borrow for daily fund
Bank/Central Bank requirement
c Banks land money to the Bangladesh Bank d None of this
Repo rate or repurchase rate: Repo rate is the rate at which the central bank of a country lends
money to commercial banks in the event of any shortfall of funds. Repo rate is used by monetary
authorities to control inflation.
Bank rate: Bank rate is the rate at which banks borrow money from the central bank without any
sale of securities. It is generally for a longer period of time. This is similar to borrowing money from
someone and paying interest on that amount.
Repo rate & Bank rate both these rates are determined by the central bank of the country based on
the demand and supply of money in the economy.
Reverse repo rate: Reverse repo rate is the rate of interest at which the central bank borrows funds
from other banks for a short duration. The banks deposit their short term excess funds with the
central bank and earn interest on it.
Reverse Repo Rate is used by the central bank to absorb liquidity from the economy. When it feels
that there is too much money floating in the market, it increases the reverse repo rate, meaning that
the central bank will pay a higher rate of interest to the banks for depositing money with it.
403 Under the following Govt. Security which is issued by Bangladesh Bank that is tradable in primary &
*** secondary market, price determined by market that are risk free security except (F-17)
Treasury Bills (T-Bills) -- [Risk Free Security] BGTB (Bangladesh Government Treasury
Bill) -- [Risk Free Security]
Debenture [Risky Security] Commercial Paper [Risky Security]
404 Which one of the following is not an instrument of government security? (F-16, 17)
***
a Treasury Bills (T-Bills) -- [Risk Free Security] b BGTB (Bangladesh Government Treasury
Bill) -- [Risk Free Security]
c Debenture (Risky Security) d Commercial Paper (Risky Security)
e Both c & d
What are the major Government Securities (G-Sec) in Bangladesh: Major G-Secs in Bangladesh are:
a). Treasury Bills (T-Bills) b). Bangladesh Government Treasury Bond (BGTB)
405 Mortgage is the transfer of an interest in specific (AR-48)
***
In a Mortgage what is specified
Mortgage is applicable in case of – (E-16, F-16, 17)
a Moveable and immovable property b Movable property Only
c Immovable property only d All of these
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What is immovable property: Immovable property commonly refers to real estate (such as your
house, factory, manufacturing plant, etc.) while movable property refers to movable assets (such as
your computer, jewellery, vehicles, etc.). “Immovable property includes land, benefits arising out of
land and things attached to the earth or permanently fastened or anything attached to the earth.”
What is movable property: A movable property can be easily moved from one place to another,
without changing its size, shape, quantity or quality. Movable property is one, which can be
transferred from one place to another place with the human efforts. Example: – Books, utensils,
vehicles, etc.
406 Maintenance of general provision & SMA in case of STA & Micro Credit - (F-17)
***
2.50%[Presently is 1%] 5.00%
2.00%
407 Off-site monitoring includes the following except (F-20)
***
Periodic reports Operating and cash flow statement
Discussions/Meeting Visits/Nominnee directors
408* Which of the following is not indicator of high credit risk? (F-20)
**
The level of loan is high relative to total assets Loan yields are high and reflect an
and equity capital imbalance between risk and return
Practice have resulted in a large number of Anxiety for income dominates planning
exceptions to the credit policy activities
409 What is the maximum tenor for any continuous loan? (E-16, F-16, 17)
*** a 06 months b 09 months
c 12 months d 18 months
410 Debt Service Coverage Ratio indicates to meet? (E-16, F-16, 20)
*** a Interest Servicing Obligation b Principal Servicing Obligation
c Both Interest & Principal Servicing obligation d None of these
Debt Service Coverage Ratio: The debt service coverage ratio indicates the amount of cash flow
available to meet annual interest and principal payments on debt. In corporate finance, the debt-
service coverage ratio (DSCR) is a measurement of the cash flow available to pay current debt
obligations. The ratio states net operating income as a multiple of debt obligations due within one
year, including interest, principal, sinking-fund and lease payments.[DSCR=(Net Operating
Income/Total Debt Service)].
411 For adjustment of Leverage, Leverage Adjusted Duration Gap (LADG) should determine, where as
*** Duration Assets Tk. 6.40 million & Duration Liability Tk. 3.50 million for 06 years & 03 years
respectively, LADG will be: (F-17)
2.90 [LADG = (Duration Assets - Duration 1.82

Liability)/∆ of time] [(6.40 – 3.50)/(6-3)]
3
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412 Current Assets Ratio 1, against current liability for determination WC, which may consider: (F-17)
***
WC > 0 WC = 0
WC < 0
413 Investment Diversification is a portfolio strategy combining a variety of assets to: (F-17)
***
Reduce the overall risk of an investment Reduce concentric risk
portfolio
Only reduce credit concentration risk
Definition of Diversification: The definition of diversification is the act of, or the result of, achieving
variety. In finance and investment planning, portfolio diversification is the risk management strategy
of combining a variety of assets to reduce the overall risk of an investment portfolio.
414 Ability of an organization to pay-off the current obligations is measured by (E-17)
***
a Coverage Ratio b Activity Ratio
c Liquidity Ratio d Growth Ratio
Liquidity ratios: These ratios are measurements used to examine the ability of an organization to
pay off its short-term obligations. Liquidity ratios are commonly used by prospective creditors and
lenders to decide whether to extend credit or debt, respectively, to companies. Examples of liquidity
ratios are the cash ratio, current ratio, and quick ratio.
Coverage ratios: These ratios are used to evaluate the ability of a business to meet its debt
obligations. These ratios are most commonly used by lenders and creditors to review the finances of
a prospective or current borrower. Examples of coverage ratios are the interest coverage ratio, debt-
service coverage ratio, and asset coverage ratio.
Efficiency ratios: These ratios measure the ability of a business to use its assets and liabilities to
generate sales. A highly efficient organization has minimized its net investment in assets, and so
requires less capital and debt in order to remain in operation. Examples of efficiency ratios are
accounts receivable turnover, inventory turnover, fixed asset turnover, and accounts payable
turnover.
Leverage ratios: These ratios are used to determine the relative level of debt load that a business
has incurred. These ratios compare the total debt obligation to either the assets or equity of a
business. Examples of leverage ratios are the debt ratio and debt to equity ratio.
Market value ratios: These ratios are used to evaluate the current share price of a publicly-held
company's stock. These ratios are employed by current and potential investors to determine
whether a company's shares are over-priced or under-priced. Examples of market value ratios are
book value per share, earnings per share, and market value per share.
Profitability ratios: Profitability ratios are a set of measurements used to determine the ability of a
business to create earnings. Profitability ratios are derived from a comparison of revenues to
difference groupings of expenses within the income statement. Examples of profitability ratios are
the contribution margin ratio, gross profit ratio, and net profit ratio.
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415 Under which section of Artha Rin Adalat Ain, 2003 responsibility has been financial institutions to
*** dispose of property of borrower before filling of suit (E-17)
a Section 8 b Section 10
c Section 9 d Section 12
416 Classified loan is categorized under- (E-17, 16)
***
a 3 categories (SS, DF, BL) b 5 categories
c 4 categories d None of these
417 Credit investigation includes (E-17)
***
a Collection and analysis of information b Making of recommendation/decision
c Credit review and monitoring d Both (a) and (b)
418 Which of the following does not constitute a line of defense against banking risk (E-17)
***
a Quality management b Good macroeconomic environment
c Portfolio diversification d Owner’s capital
419 What is the role of internal auditors in the risk management of bank? (E-17)
***
a Set policies b Evaluation and expression of opinion
c Test compliance with laws, policies and d Effective supervision and monitoring
procedures etc
420 Which one is not a charge documents (E-16)
*** a D.P Note b Mortgage
c Letter of Pledge d Both (b) & ©
421 Which one of the following is not a charge document? (E-17)
*** D.P note Letter of revival
Letter of continuity Assignment
422 Which one of the following is a charge document (F-18, E-19)
*** Which one of the charge documents is required for all types of advances (E-17, AR)
a D.P note b Letter of revival, Mortgage
c Letter of continuity d Assignment, Letter of Revival
423 Which one of the following is not a charge document (E-18)
***
a Hypothecation b Pledge
c Negative lien d Assignment
Charging Securitiy: Lien, Pledge, Hypothecation, Mortgage, Assignment, Right of Set-off
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424 Which of the following is the formula of burden coverage? (E-17)
***
a Funded income divided by operating expense b Non-interest income divided by interest
expense
c Non-interest income divided by operating d interest expense divided by operating
expense/non-interest expense expense
425 A company has a net income of (BDT) 35 million, if the company pays out BDT 1 million
*** preferred dividend and has 10 million shares for half of the year and 15 million shares for the whose
half of EPS would be-(EO-2017)
a BDT 1.92 b BDT 1.00

c BDT 2.00 d BDT 0.96
426 Which one of the following is an example of leverage Ratio? (E-17, 15)
***
a Debt to Asset ratio=Total debt/assets b Debt to equity ratio=Total
debt/Shareholders Equity
c Debt to capital ratio=Total debt/Capital d All of these
(debt+equity)
List of common leverage ratios: 1. Debt-to-Assets Ratio = Total Debt / Total Assets. 2. Debt-to-
Equity Ratio = Total Debt / Total Equity. 3. Debt-to-Capital Ratio = Today Debt / (Total Debt + Total
Equity). 4. Debt-to-EBITDA Ratio = Total Debt / Earnings Before Interest Taxes Depreciation &
Amortization (EBITDA). 5. Asset-to-Equity Ratio = Total Assets / Total Equity.
427 When financial institution and banks undertakes activities related to banking like investment, issue
*** of debt and credit card etc. then it is known as – (E-16)
a Internet Banking b Universal Banking
c Virtual Banking d Wholesale Banking
Universal Banking: A universal bank is a bank which offers commercial bank functions plus other
functions such as Mercant Banking, Mutual Funds, Factoring, Credit Card, Housing Finance, Auto
Loans, Retails Loans, Insurance, etc.
Virtual Banking: A virtual bank is a bank that offers banking services through electronic channels. ...
Clients can open an account, make deposits, taking out loans and perform other banking
transactions via a mobile app or through the website of the virtual bank, thus saving time due
without having the need to visit a bank. The Virtual Banking is the provision of accessing the banking
and related services online without actually going to the bank branch/office in person.
428 The object of Limitation Act is (E-16)
*** a To put the party in Joint b To enter into an agreement with the party
c To release the party from his liability d To prescribe the period within which right
can be enforced in a court of law
429 ABC sold Tk. One Million of their products in 2015. If the fixed and variable cost of each of
*** theproduct is Tk.75.00 and Tk.25.00 respectively, what is the total quantity of the production? (E-16)
a 1000 b 10000
c 40000 d None of these
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430 The XYZ bank lends Tk. Half a million for one year @ 10% per annum to counterparty. What will be
*** the quarterly interest amount of the interest that to be recovered? (E-16)
a 10000 b 50000
c 12500 d 25000
431 Total current assets and current liabilities of a trading firm are Tk. 2 million and 0.50 million
*** respectively. What is the current ratio of the firm? (EO-2016)
a 4:1 b 4:1
c 2:1 d None of these
432 Maintenance of Specific provision in case of SS/DF of Short Term Agricultural Credit and Micro Credit
*** is (EO-2016)
a 20% b 50%
c 5% d 100%
433 Any continuous loan will be classified as “Substandard” if it is past due/overdue – (E-16)
***
a For 02 months but less than 03 months. b For 03 months but less than 06 months
c For 06 months but less than 09 months d For 09 months but less than 12 months
434 What is the primary security of LIM (LOAN AGAINST IMPORTED MERCHANDISE). (E-16)
***
a Imported Stock b Personal Guarantee
c Post Dated Cheque d Both (a) & (b)
435 What will be the drawing power of a customer when stock value is Tk.2.00 Crore and required
*** margin is 25%? (E-16, 14)
a Tk.1.50 Crore b Tk.2.25 Crore
c Tk.1.60 Crore d Tk. 4.00 Crore
436 Which of the following ratios is/are considered while assessing liquidity of a borrower? (E-15)
*** a Acid- Test ratio b Sales Turnover
c P/E Ratio d Debt-Equity Ratio
437 In RMG financing CM stands for (E-15)
*** a Cloth Making b Cutting & Making
c Caltulative Margin d Contribution Margin
What Is the Contribution Margin: The contribution margin can be stated on a gross or per-unit
basis. It represents the incremental money generated for each product/unit sold after deducting the
variable portion of the firm's costs.
The contribution margin is computed as the selling price per unit, minus the variable cost per unit.
Also known as dollar contribution per unit, the measure indicates how a particular product
contributes to the overall profit of the company. It provides one way to show the profit potential of a
particular product offered by a company and shows the portion of sales that helps to cover the
company's fixed costs. Any remaining revenue left after covering fixed costs is the profit generated.
[(Total Revenue-Variable Cost)/Total Revenue]
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438 IN RMG FINANCING FUND COVERAGE MEANS (E-2015)
***
a EXPORT LC IN HAND b TOTAL EXPORT LIABILITY
c DIFFERNCE BETWEEN EXPORT ASSET AND d DIFFERENCE BETWEEN CUTTENT ASSET
EXPORT LIABILITY AND CURRENT LIABILITY
439* Maximum permissible PC is (E-15)
** 10% of FOB value 15% of FOB value
20% of FOB value None of the above
440 In RMG sector ACCORD is (2015)
*** a A multinational buyar b A buying house
c A garments factory d A fire and building safety inspection
agency
Note: The Accord on Fire and Building Safety in Bangladesh (the Accord) was signed on 15 May 2013.
It is a five-year independent, legally binding Global Framework Agreement between global brands,
retailers and trade unions designed to build a safe and healthy Bangladeshi Ready Made Garment
(RMG) Industry. The agreement was created in the immediate aftermath of the Rana Plaza building
collapse that led to the death of more than 1100 people and injured more than 2000. In June 2013,
an implementation plan was agreed leading to the incorporation of the Bangladesh Accord
Foundation in the Netherlands in October 2013.
The agreement consists of six key components:
1. A five-year legally binding agreement between brands and trade unions to ensure a safe working
environment in the Bangladeshi RMG industry
2. An independent inspection program supported by brands in which workers and trade unions are
involved
3. Public disclosure of all factories, inspection reports and corrective action plans (CAP)
4. A commitment by signatory brands to ensure sufficient funds are available for remediation and to
maintain sourcing relationships
5. Democratically elected health and safety committees in all factories to identify and act on health
and safety risks
6. Worker empowerment through an extensive training program, complaints mechanism and right to
refuse unsafe work.
441 A banker's lien is.......(G)
*** “Banks right to retain all properties against debt” until discharge/adjustment of debt bank has no
power to sale it - (F-17)
Attachment General Lien
Assignment
442 The banker is not entitle to exercise right of lien in respect of -Security received for safe custody (F-
*** 17)
443 While opening an account in the name of a company, the most important document to be seen (E-
*** 16, 18, 17, C-16)
a List of employees/directors of the company b List of promoters/ shareholders of the
company
c Memorandum and Articles of association of d Instructions of the RJSC
the company
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Note: While the MOA describes the powers and objects of the company, an AOA defines its rules.
The MOA is subordinate to the Companies Act, and the AOA is subordinate to the memorandum.
The memorandum cannot be amended retrospectively while an AOA may be changed.
444 Salam and Kalam are joint trustees and Salam is authorized to operate the account. He issues a
*** cheque but Kamal gives a stop payment notice. The bank in the case: (E-14)
Should not obey as Kalam is not having the Obey the instructions of Kalam as he is one
powers to operate of the trustees.
Should ask Salam, as to why the stop payment Seek court direction because of the dispute
not to be stopped
445 As a banking financial institution (BFIs) bank incorporated (Registration) under the company act 1994
*** (Amendmended 1913), what document shouls the company be registered-Certificate of
incorporation. (F-17, F-16)
446 Which one of the following is not capital element of Tire-1 (F-17)
***
Which one of the following is not included in Tier-1 Capital under BASEL-II capital accord (EO-19, 16,
F-16),
a Paid Up Capital b General Provision
c Statutory Reserve d Retained Earnings
447 Which one of the following is not included in Tier II Capital (E-17)
***
a General Reserve b Asset revaluation reserve
c All preference shares d ExchangeEqualization
448 The New Capital Adequecy Framework prescribed for the banks commodity known as – (E-16)
*** a DERA Guidelines b CBS Policy
c BASEL Policy d RTGS Policy
449 Under the BASEL II frame work Market Discipline falls under which of the following pillar (EO-2018,
*** 2017)
a Pillar-I b Pillar-III
c Pillar-II d None of these
450 Which of the following statement is true for cash credit (Hypo) facility? (F-20)
*** Both possession and tiltle of the goods remains Both possession and tiltle of the goods
at the disposal of the Bank remains at the disposal of the Borrower
Possession of goods remains with the Possesssion of goods remains with the bank
borrower but the tiltle of the goods remains but the title
at the disposal of the bank
451 Limitation of Basel-1 accord are the following except (EO-20, F-20)
***
a Exclusive focus on credit risk b Inadequate differentiation of credit risk
c Does not recognize portfolio diversification d Levy of capital charge for operational risk
effect of credit risk
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452 Which of the following risk is not included in pillar-I under BASEL II accord (EO-2019)
***
Under Basel II which risk is not considered for the calculation of minimum capital requirement? (AR)
a Credit Risk b Market Risk
c Legal Risk/Management Risk d Operational Risk
453 Which of the following are to be followed by Commercial Banks for risk management? (F-2019)
***
Basel I norms Basel II norms
Basel III norms Solvency II norms
Note: Basel II is the second of the Basel Accords which are recommendations on banking laws and
regulations issued by the Basel Committee on Banking Supervision.
454 Which of the following is not included in three pillars of BASEL-? (EO-2017)
***
a Minimum capital requirement b Supervisory review
c Core banking solution d Market discipline
455 Transfer of possession of physical security is essential in the case of -(C-21)
***
a Lien b Mortgage
c Pledge d Both (a) and (C)
456 Right Borrower should be selected at- (C-21)
***
Pre-sanction stage Post-sanction stage
Recovery stage
457 Which of the following is considered a profitability measure (E-2015)
***
a Days sales in inventory b Fixed assets turnover
c Cash coverage ratio d Return of assets
458 Credit portfolio diversification (EO-2020)
***
a Reduces all types of credit risk b Increases all types of credit risk
c Reduces credit concentration risk d Increase average return from credit
459 Which of the following parameter has got the lowest priority in terms of assigning the weight while
*** determining the credit risk grading score (EO-2020)
a Financial risk b Management risk
c Business risk d Relationship risk
460 Which type of risk arises before a bank that trades in government securities? (E-16)
***
a Liquidity Risk b Credit Risk
c Market Risk d Trade Risk
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461 A debtor makes default in repayment of a bank loan and which type of risk is this for a lending bank
*** (E-16)
a Liquidity Risk b Interest Risk
c Operation Risk d Credit Risk
What Is Credit Risk: Credit risk is the possibility of a loss resulting from a borrower's failure to repay
a loan or meet contractual obligations. Traditionally, it refers to the risk that a lender may not
receive the owed principal and interest, which results in an interruption of cash flows and increased
costs for collection. Excess cash flows may be written to provide additional cover for credit risk.
When a lender faces heightened credit risk, it can be mitigated via a higher coupon rate, which
provides for greater cash flows.
What Is Liquidity Risk: Liquidity is the ability of a firm, company, or even an individual to pay its
debts without suffering catastrophic losses. Conversely, liquidity risk stems from the lack of
marketability of an investment that can't be bought or sold quickly enough to prevent or minimize a
loss. It is typically reflected in unusually wide bid-ask spreads or large price movements.
462 Yield on bond is 7% and market required return is 14% then market risk premium would be- (F-20)
*** 0.02 0.21
0.0005 0.07
Market risk premium = Market required return - Yield on bond
463* IN CAPITAL BUDGETTING , POSITIVE NET PRESENT VALUE RESULT IN (F-20)
** NEGATIVE ECONOMISC VALUE ADDED POSSITIVE ECONOMIC VALUE ADDED
ZERO ECONOMIS VALUR ADDED PRESENT INCOME VALU ADDED.
464* A project whose cash flows are more than capital invested for rate of return then net present value
** will be- (F-20)
POSITIVE INDIPENDENT
NEGATIVE ZERO
465* RAW MATERIAL STORAGE PERIOD AND DURATION OF OPERATING CYCLE ARE (F-20)
** INDIRECTLY LINKED TO EACH OTHER IRRELEVANT TO EACH OTHER
BOTH RELEVANT WHILE CALCULATING THE DIRECTLY RELATED TO EACH OTHER.
FINANCIAL RATIOS
466 THE DISCOUNT RATE THAT EQUALIZES THE CURRENT MARKET VALUE OF A LOAN OR SECURITY WITH
*** THE EXPECTED STREAM OF FUTURE INCOME PAYMENT FROM THAT LOAN OR SECURITY IS KNOWN
AS THE- (F-2020)
BANK DISCOUNT RATE YIELD TO MATURITY

ANNUAL PERCENTAGE RATE(APR) ADD ON INTEREST RATE
467 The ratio of total loans to total deposits constitute- (FAVP-2018, 2020)
***
Liquidity risk Credit risk
Deposit risk Compliance risk
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468 Duration analysis is required to cope with (EO-19, F-19)
***
a Credit Risk b Liquidity Risk
c Market Risk d None of the above
469 Risk that arises to a bank due to failure of internal process is called (EO-2020)
***
a Process risk b Internal risk
c Operational risk d Management risk
Note: Basel Committee on Banking Supervision has defined operational risk as to the risk of loss
resulting from inadequate or failed internal processes, people, and systems or external events.
470 The potential future deterioration of the credit quality of an un-defaulted exposure is called (EO-
*** 2020)
a Counter party credit risk b Exposure limit risk
c Operational risk d Migration risk
Note-1: The potential deterioration of the credit quality of an un-defaulted exposure is called
migration risk. This form of potential loss is generally also subsumed under a broader definition of
credit risk.
Note-2: Credit risk is defined as the possibility that a borrower or other contractual counterparty
might default, i.e. might fail to honor their contractual obligations.
Note-3: Transaction risk refers to individual loans and essentially measures (1) the standalone
probability that the borrower will be able to repay, as well as (2) the ultimate loss in the case of a
borrower default after use of collateral and other mitigating factors.
Note-4: Portfolio credit risk is concerned with measuring correlations between individual borrower
defaults, the effects of diversification, the cyclicality of collateral values and the implications of
reputation and contagion effects in microcredit.
471 Which of the following is the uncertainty in earnings due to misconduct by employees, computer
*** errors, flooding, lighting, strike and other similar events? (FAVP-2019)
Capital risk Liquidity risk
Operational risk Interest rate risk
472 Which of the following is the probability that market interest rates will change and cause it to have
*** lower profits or a decrease in the value of its equity? (F-19, 20)
Credit risk Market Risk
Strategic Risk Interest Rate Risk
Operational risk: Operational risk is the prospect of loss resulting from inadequate or failed
procedures, systems or policies. Employee errors. Systems failures. Fraud or other criminal activity.
Any event that disrupts business processes.
Market Risk: The Basel Committee on Banking Supervision defines market risk as the risk of losses in
on- or off-balance sheet positions that arise from movement in market prices. Market risk is the
most prominent for banks present in investment banking. ... This is because they are generally active
in capital markets
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Liquidity Risk: Liquidity risk is the risk that a company or bank may be unable to meet short term
financial demands. This usually occurs due to the inability to convert a security or hard asset to cash
without a loss of capital and/or income in the process.
Interest Rate Risk: The interest rate risk, or market risk, refers to the chance that investments in
bonds – also known as fixed-income securities – will suffer as the result of unexpected interest rate
changes.
Which risk is mainly managed by Treasury Division-Liquidity, Exchange Rate, Interest Rate Risk
473 A bank is unable to pay its short term deposits because the bank’s fund is long term investments.
*** The risk derived in this case is known as (EO-20, 19, 17)
a Market Risk b Operational Risk
c Liquidity Risk d Interest Rate Risk
474 HOW MUCH WAS THE TOTAL CAPITAL OF THE BANK AS ON DECEMBER 31, 2014. (2015)
***
a BDT 1569.12 CRORE b BDT 2569.12 CRORE
c BDT 3569.12 CRORE d BDT 4569.12 CRORE
475 Bank will consider the application for second time rescheduling upon receiving (2015)
***
a Cash payment of at least 30% of the overdue b Cash payment of at least 30% of the
installment or 20% of the total outstanding overdue installment or 20% of the total
amount of loan, whichever is less; outstanding amount of loan, whichever is
more
c Cash payment of at least 20% of the overdue d Cash payment of at least 20% of the
installment or 30% of the total outstanding overdue installment or 30% of the total
amount of loan, whichever is less; outstanding amount of loan, whichever is
more
476 If a Continuous loan is classified as Sub-Standard and it is rescheduled for the third time, what would
*** be the maximum time limit for the loan from the date of rescheduling? (2015)
a 24 Months b 18 months
c 12 months d 6 Months
477 For a single exporter what is the maximum ceiling for EDF loan? (2015)
***
a USD 5 Million b USD 10 Million
c USD 15 Million d USD 20 Million
478 A Customer has CC(H) limit of tk. 120 crore from our bank. How much stock the customer must have
*** to withdraw the full amount if margin is 40% (E-2015)
a Tk. 300 Crore b Tk. 120 Crore
c Tk. 200 Crore d Tk. 180 Crore
Hints:100-40=60, 60=100=100/60*120=200
479 The Primary Security of Overdraft (work order) is (E-14)
*** a Mortgage of Land & Building b Hypothecation of Stock
c Personal Guarantee of the Propritor/Directors d Assignment of Bill.
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480 Repayment Capacity of a business shall be measured based on- (E-14)
*** a Cash Flow b Collateral Security
c Clean CIB report d Net worth of Directors
Note: Capital Debt Repayment Capacity is calculated using select financial information found on the
cash flow statement and the accrual income statement.
481 What is the maximum rate of interest that can be charged by any PCBs to Loan to Agriculture & Rural
*** sector as per BRPD circular no. 17 dated 21.12.014 of Bangladesh Bank? (E-14)
a 13% b 14%
c 12% d 10%
482 Which of the following is part of operating cycle (E-2015)
*** a Inventories (RM/WIP/FG) b Accounts recevables
c Accounts payables d All of the above
Operating Cycle Definition: The Operating cycle definition establishes how many days it takes for a
company to turn purchases of inventory into cash receipts from its eventual sale. It is also known as
cash operating cycle or cash conversion cycle or asset conversion cycle. Operating cycle has three
components of payable turnover days, Inventory Turnover days and Accounts Receivable Turnover
days. These come together to form the complete measurement of operating cycle days. The
operating cycle formula and operating cycle analysis stems logically from these. To be more specific,
the payable turnover days are the period of time a company keeps track of how quickly they can pay
off their financial obligations to suppliers.
What is Inventory: Inventory is a current asset account found on the balance sheet, consisting of all
raw materials, work-in-progress, and finished goods that a company has accumulated. It is often
deemed the most illiquid of all current assets and, thus, it is excluded from the numerator in the
quick ratio calculation.
Accounts Payable Turnover Definition: The accounts payable turnover ratio indicates how many
times a company pays off its suppliers during an accounting period. It also measures how a company
manages paying its own bills. A higher ratio is generally more favorable as payables are being paid
more quickly. When placed on a trend graph accounts payable turnover analysis becomes simplified:
the line raises and lowers just as the ratio does. Common adaptations used to calculate accounts
payable turnover yield results like accounts payable turnover ratio in days, A/P turnover in days, and
more. A useful tool in managing and measuring the efficiency of paying bills is a Flash Report.
Accounts Receivable Turnover Definition: Accounts receivable turnover analysis can be used to
determine if a company is having difficulties collecting sales made on credit. The higher the turnover,
the faster the business is collecting its receivables.
483 HOW NPV IS CALCULATED? (2015)
*** a INITIAL INVESTMENT- PV OF FUTURE CASH b INITIAL INVESTMENT + PV OF FUTURE CASH
FLOWS: FLOWS:
c PV OF FUTURE CASH FLOWS; d NONE OF THE ABOVE
What Is Net Present Value (NPV): Net present value (NPV) is the difference between the present
value of cash inflows and the present value of cash outflows over a period of time. NPV is used in
capital budgeting and investment planning to analyze the profitability of a projected investment or
project. NPV is the result of calculations used to find today’s value of a future stream of payments.
(NPV=Cash flow-initial investment)
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484 What amount of Taka would a defendant require to deposit to file Appeal against the decree of
*** Artha Rin Adalat?(E-14)
a 50%, b 100%,
c 150%, d 200%
485 WHAT IS THE CORPORATE TAX OF THE BANK? (2015)
***
a 42.50% b 35.50%
c 40.50% d 37.50%
A publicly listed bank or a non-bank financial institution (NBFI) must pay 37.50% corporate tax –
which is 40% for non-listed banks.
For publicly listed mobile companies, the tax rate is 40%, while it is 45% for non-publicly listed
mobile network operators.
486 A company has current liabilities of tk 10 crore, long-term liabilities of tk. 7 crore, current assets of
*** tk. 15.00 crore and fixed assets of the tk 10 crore. What is the current ratio of the company? (E-15)
a 1.50 b 1.47
c 2.14 d 1.42
487 Ratio of net income to number of equity shares known as: (E-15)
*** a Price earnings ratio b Net profit ratio
c Earnings per share d Dividend per share
Note: Earnings per share indicates profitability of a company. It is calculated by dividing company's
net income with its total number of outstanding shares.
488 For which function money is accepted as unit of account? (E-19)
***
a Medium of exchange b Measure of value
c Standard of deferred payment d Store of value
Note: Money also functions as a unit of account, providing a common measure of the value of goods
and services being exchanged. Knowing the value or price of a good, in terms of money, enables
both the supplier and the purchaser of the good to make decisions about how much of the good to
supply and how much of the good to purchase.
489 In writing to the guideline of KYC under which of the following act principle it is liable for
*** punishment? (C-17, 18)
BASELiii accord Banking company’s act ,1991
FERA 1947 Negotiable instrument act 1881
490 Which section of Bank company Act 1991 (amended up to 2013) clearly spells out the defination of
*** defaulter (2015)
a 27 (Ka Ka) "List of Defaulting Borrowers" b 15 (Ka Ka)

c 5 (Ga Ga) d 26 (Gha)
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491 BFI’s (Banks & Financial Institutions of Bangladesh) are guided by: (C-17, 16, 21, E-16)
***
a Financial institutions Act 1993 b Companies Act 1994
c The Banking Companies Act 1991 d Bangladesh Bank Order 1972
Note: The financial system of Bangladesh comprising state own, private and foreign commercial
banks, Islamic commercial banks, government owned specialized and development banks, non-
schedule bank, non-banking financial institutes, merchant banks, insurance companies, stock
exchanges and cooperative banks.
492 Restrictions on the respite of loans have been imposed under which section of the Bank Company
*** Act, 1991 as amended in 2013 (F-19, 20)
a Section 14A b Section 27
c Section 26 A d Section 28
Section 14: Regulation of paid-up capital, subscribed capital and authorized capital and voting rights
of share-holders. Section 26: Subsidiary Companies. Section 27: Restrictions on loans and advances.
Section 28: Restrictions on the respite of loans.
493 Which one is not the financial risk component as per CRG? (EO-2020)
*** a High leverage b Low profitability
c Poor liquidity d Insufficient cash flow
494 For collateral located outside Pourashava, the coverage should be: (E-14)
*** 1.25 times of the proposed limit 1.80 times of the proposed limit
1.40 times of the proposed limit 1.75 times of the proposed limit
495 What amount is required in 1st time reschedule of a term loan? (E-14)
*** 10% of overdue or 15% of outstanding 15% of overdue or 10% of outstanding
30% of overdue or 20% of outstanding All of the above
496 Call money transaction take between (E-14)
*** Customer to customer Bank/NBFIs to customer
Bank/NBFI to Bank /NBFI Both (a) & (B)
497 Which of the following is a must in case of third part security? (E-14)
*** Postdated cheques Personal guarantee of the proprietor
Personal guarantee of the spouse Letter of consent
498 Which of the following is a characteristic of lien (E-14)
*** Lien does not give power of sale but only to Lien gives the power of sale
retain the property
Lien does not give the power to retain the None of the above
property
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Characteristics Of Lien:
1. Possession is essential for exercising the right of lien. Without possession, there can be no lien.
2. The right of lien arises from statute or law, not from a contract.
3. The possession must be rightful, and not obtained by force, fraud or misrepresentation.
4. The right of lien is a right to possess something, not to sell it.
5. The person holding the right of lien is not the actual owner-he is somebody other than the owner.
6. The right of lien is not transferable to a third person.
7. The lien terminates when the bailee’s demands are met.
8. When the possession terminates, the lien also terminates.
*** Maximum non-funded exposure for RMG is: 35% of total capital (E-14)
499 What is Paripassu Charge (E-14)
*** Second charge Floating charge
A&B Proportionate Charge
What is Pari-Passu Charge:
Pari – Passu is a Latin expression. Literally means “with an equal footing” or “ with an equal step.” It
is sometimes translated as “ ranking equally.” Hence, Pari-passu charges mean charge holders have
equivalent rights over the borrower assets on which pari-passu charge is created.
Pari-passu occurs during bankruptcy proceedings when a verdict is reached, all creditors can be
regarded equally, and will be repaid at the same time and at the same fractional amount as all other
creditors. Treating all parties the same means they are pari passu.
500 Which of the following items is the part of Off-balance sheet exposure? (E-14)
***
Acceptance Loans & Advances
Deposit Investment
What Is Off-Balance Sheet (OBS): Off-balance sheet (OBS) items is a term for assets or liabilities that
do not appear on a company's balance sheet. Although not recorded on the balance sheet, they are
still assets and liabilities of the company. Off-balance sheet items are typically those not owned by or
are a direct obligation of the company. For example, when loans are securitized and sold off as
investments, the secured debt is often kept off the bank's books. Prior to a change in accounting
rules that brought obligations relating to most significant operating leases onto the balance sheet, an
operating lease was one of the most common off-balance items.
501* If yearly operating expense of a firm is Tk. 100.00 lac and number of operating cycle per year is 4.
** Working capital requirement of that firm will be- (E-14)
Tk. 20 lac Tk. 25 lac
Tk. 50 lac None of the above
502* “Asha Lota Handicraft” is business firm involved in manufacturing of handicraft items. There are 12
** employees in the firm. Moreover, the firm has total fixed assets of Tk. 0.05 crore (excluding land &
building) definition provided by Bangladesh Bank, the firm is ………………………Micro…………………..
enterprise. (E-2014)
503* Which of the following is not true about CRG? (F-18)
**
Management risk has been given only 12% Risk of leverage is assessed by debt equity
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weight ratio
A borrower with credit risk grading score 55-64 Financial risk arises from high leverage,
is abbreviated as SM poor, liquidity, low profitability and poor
relationship with customer
504* Which one of the following is lower risk status show in the CRG: (F-17)
**
Financial Risk Business Risk
Management Risk Security Risk/Relationship Risk
505* CRG is basic module for developing– (F-17)
**
Credit Risk Management System (CRMS) Credit Risk Grading System
Credit Disbursement Management System
DEFINITION OF CREDIT RISK GRADING (CRG): *The Credit Risk
Grading (CRG) is a collective definition based on the pre-specified scale and
reflects the underlying credit-risk for a given exposure.
*A Credit Risk Grading deploys a number/ alphabet/ symbol as a primary summary indicator of
risks associated with a credit exposure.
*Credit Risk Grading is the basic module for developing a Credit Risk Management system.
506* CRG is not required for (E-17, 16)
** a Consumer credit b Micro credi
c Short term Agricultural credit (STAC) d All of these
507* Which one of the following is most preferable to the exporter? (E-17, 16, F-17,18, 19)
** Which of the following is the least preferred method of payment to the importer? (E-20)
Which of the following is the cheapest but very risky is the importer (EO-2018)
a Documentary collection b Cash in advance
c Documentary credit d Open account
Note: Cash-in-advance is the most secure method of payment for the exporter because the importer
pays the full or a significant amount of the payment before the goods are shipped.
508 As a trade payment method, Cash in Advance is the most preferable to the (FAVP-2019)
***
Exporter Bank
Importer Issuing Bank
509 International banking includes- (E-17)
*** Trade Service include- (E-18)
a Trade payment b Trade finance
c Foreign Exchange d Both a and b
510 Which one of the following is most popular in the Globe? (E-18)
***
a Open Account b Documentary collection
c Cash in advance d Documentary credit
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511 As a trade payment method, Open Account is the most preferable to the (E-19, 20)
***
a Exporter b Bank
c Importer d Issuing Bank
512 Which one of the following is the most preferable payment method to an importer? (F-17)
***
Open account Cash in advance
C. Documentary Credit Documentary Collection
513 Open Account: An open account is a sale in which the goods are shipped and delivered before
*** payment is due usually in 30, 60, or 90 days.
This is one of the most advantageous options to the importer, but it is a higher-risk option for an
exporter.
Foreign buyers often want exporters to offer open accounts because it is much more common in
other countries, and the payment-after-receipt structure is better for the bottom line.
514 Which one is the most preferable to an importer (2016, F-16, F-17, 2019)
***
a Cash in Advance b Consignment sale
c Documentary Collection d Documentary Credit
Note: Consignment is similar to an open account in some ways, but payment is sent to the exporter
only after the goods have been sold by the importer and distributor to the end customer. The
exporter retains ownership of the goods until they are sold. Exporting on consignment is very risky
since the exporter is not guaranteed any payment. Consignment, however, helps exporters become
more competitive because the goods are available for sale faster. Selling on consignment reduces
the exporter’s costs of storing inventory.
515 Which one is the most preferable to an importer- (E-16)
*** a) Cash in Advance Open Account
b) Documentary Collection Documentary Credit
Note: This is one of the most advantageous options to the importer, but it is a higher-risk option for
an exporter.
516* Which of the following is true? (EO-2019, FAVP-2019)

** a Nominated Bank is legally nominated by the b UCP takes care of all the payment and
Exporter financing issues of LC
c Having more than one advising bank is not d Purchasing Bill under documentary
allowed in UCP 600 collection may not always be riskier that
LC
Note: There is a common miss-conception that four or five multiple banks must be involved to
manage letter of credit transactions. These multiple banks include credit issuing banks, advising
banks, negotiating banks, confirming banks, and reimbursing banks. What is less understood is that
these “banks” are functions, not necessarily physical banks. The trade finance functions these banks
perform in a transaction can be done by separate banking institutions or by one bank under UCP 600
guidelines (Uniform Customs and Practice for Documentary Credits, ICC Publication 600).
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517 In case of Documentary Collection (F-19, 20)
***
DA involves higher risk to an exporter than DP Payment is made against acceptance in
case of DP
Payment is made against payment in case of Payment is guaranteed in case of DP
DA
518 In documentary collection, exporters present documents to the counter of (E-20, 19, 17, F-18)
*** In documentary collection, documents is presented by- (E-18)
a Issuing Bank b Negotiating Ban
c Nominated Bank d Remitting Bank (Exporter’s Bank)
Note: A documentary collection (D/C) is a transaction whereby the exporter entrusts the collection
of payment to the exporter’s bank (remitting bank), which sends documents to the importer’s bank
(collecting bank), along with instructions for payment. Funds are received from the importer and
Remitted to the exporter through the banks in exchange for those documents. D/Cs involve using a
bill of exchange (commonly known as a draft) that requires the importer to pay the face amount
either at sight (document against payment [D/P] or cash against documents) or on a specified future
date (document against acceptance [D/A] or cash against acceptance). The collection cover letter
gives instructions that specify the documents required for the delivery of the goods to the importer.
Although banks do act as facilitators (agents) for their clients under Collections, D/Cs offer no
verification process and limited recourse in the event of non-payment. D/Cs are generally less
expensive than letters of credit (LCs).
519 As per URC 522, Documentary Collection is relatively risky for (EO-2018, 2017)
***
a Principal (EO-2018) b Beneficiary
c Importer d Exporter
There are typically seven steps that occur in order to get paid using documentary collections: 1. The
exporter ships the goods to the importer and receives the documents in exchange. 2. The exporter
presents the documents with instructions for obtaining payment to the bank. 3. The exporter's
remitting bank sends the documents to the importer's collecting bank. 4. The collecting bank
releases the documents to the importer on receipt of payment of acceptance of the draft. 5. The
importer uses the documents to obtain the goods and to clear them at customs. 6. Once the
collecting bank receives payment, it forwards the proceeds to the remitting bank. 7. The remitting
bank credits the exporter's account.
520 Which one of the following is true? (E-16)
*** a Confirmed LC contain two undertakings b Advance Payment is the most preferable
method of payment to the importer
c Documentary collection is guided by URC 522 d Proforma Invoice is same as Commercial
Invoice
521 Which one of the following is not party to a documentary credit? (E-20, 17)
*** a Issuing bank b Confirming bank
c Beneficiary/Exporter d The applicant
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522 Which of the following is the most widely used method of payment in Bangladesh? (E-19, F-19, 20)
*** a Documentary Collection b Documentary Credit (EO-2019)/Letter of
Credit/LC
c Cash in Advance d Open Account
523* In Documentary Credit, exporters present documents to the counter of (FAVP-2019, 2020)
**
Issuing Bank Nominated Bank
Negotiating Bank Remitting Bank
524* Which of the following is true in regard to documentary credit? (FAVP-2017)
**
Issuing bank can also be an advising bank Issuing bank may negotiate
Nominated bank may honour Presenter is responsible to negotiate
documents
525 What triggers settlement order documentary credit? (EO-2017)
***
a Evidence of shipment of goods b Letter of introduction
c Handing over the documents to an applicant d Presentation of complying documents by
the beneficiary
526 Which of the following is true in regard of Documentary Credit? (EO-2016, F-16, F-17)
*** a Issuing Bank can also be issuing advising Bank b Issuing Bank may negotiate
c Nominated Bank may honor d Presenter isresponsible to negotiate
document
527 LC as payment Method is a: (E-19, F-19, 20)
***
a Commitment of the importer b Guarantee by a Bank
c Commitment on behalf of a Bank d Commitment of a Bank on Behalf of an
importer/Applicant
528 Confirming a letter of credit by a confirming Bank means - (EO-2018)
***
a Offering two undertakings b Offering one undertaking
c Offering an additional undertaking d Offering a guarantee
529 Factoring Means (EO-2015)
***
a Financing based on facts b Financing against account recevables by a
third party other than buyer ans seller
c Financing against account receivables by the d All of the above
bank
530 What is Factoring? (F-19, 20)
*** An easy way of raising capital from a factoring Selling of account receivables on a
company by small business contract basis for cash payment to a factor
before it is due
An arrangement for raising short term money A method of discounting of long term bills
against prepaid expenses
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531 Which one of the following is pre shipment credit ? (2017, AR)
***
a An Advance for packing goods b PC (Packing Credit)
c A priority sector advance d Advance for import
*** In RMG financing, PC stands for– Packing Credit (E-14)
532 Packing credit is- (EO-2018, 2017)
***
a An Advance for packing goods. b Pre- shipment finance for export
c A priority sector advance d Advance for import
1) Pre-shipment Finance throughBack to Back Letter of Credit issued against the export (Master
LC/Contract) credit to facilitate export oriented RMGs, Export LC (Advising & Transfer), EDF Loan,
ECC, Over Draft (Garments) and Packing Credit.
2) Post-shipment Finance through Export Bill Purchase, Export Bills for Collection, Inland
Documentary Bills Purchase/Foreign Documentary Bills Purchase.
533* Deemed exporter means (E-14)
** Direct exporter Egg exporter
Shrimp exporter Indirect exporter
534* What is the maximum tenure of PAD? (E-14)
** 30 days 21 days
45 days None
535 PAD (Payment Against Documents) is an example of- (FAVP-2018, 2020)
*** LIM (Loan Against Imported Merchandise) is an example of (EO-2020, 2017)
LTR (Loan Against Trust Receipt) is an example of (EO-2018)
FBPD (Foreign bill purchased and discounted) is an example of- (2016, 2017, 2018, F-16, F-17)
a Post import financing technique (EO-2020, b Pre import financing technique
2018)/Post shipment credit
c Pre shipment financing d Post shipment financing to the exporter
536 Which of the following is an export financing technique-? (EO-2016)
*** a Letter of credit b PAD
c LTR d Packing credit
537 Which of the following is a post import financing technique? (FAVP-2017)
*** FBPD BTBL/C
PC Letter of Credit/LTR
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538 LTR is an example of – (E-16)
***
Pre-Shipment Credit Post-Shipment Credit
Pre-import Credit None of the above
539 LTR means- (C-21)
***
Long Term Recovery Loan Against Trust Receipt
Liability Against Trust Receipt Loan Against True Receipt
540 Negotiation is an example of (EO-2020)
***
a Pre-shipment credit b Post-shipment credit
c Pre-import credit d Post-import credit
541 LTR is an example of: Post import finance (FAVP-2017)
***
542 According to UCPDC (Uniform Custom and Practices for Documentary Credit)-600, the reasonable
*** time to examine the documents: (AR)
Which is the time allowed in UCP-600 for honoring or refuse to honoring the documents (E-20).
a Not exceeding 2r banking days foilowing the b Not exceeding 7 banking days following the
day of receipt. clay of receipt.
c Not exceeding 5 banking days following the d Not exceeding 3 banking days foilowing the
day of receipt (AR)/ 05 banking days (E-20). day of receipt.
543 A document credit calls for the beneficiary’s invoice in three copies as per UCP. Which of the
*** following requirements is mandatory for a complying presentation? (EO-2020, 2015)
a At least one of the three must be signed b At least one of the three must be original
c All Must be signed d All must be original
544 As per UCP-600, bill of exchange should be drawn on- (EO-2018, AR)
***
a Importer b Exporter
c Issuing Bank d Reimbursing Bank.
545 Which one of the following guideline is not under ICC? (F-16, FAVP-2017)/
***
Which of the following is a domestic regulation? (E-19, FAVP-2019, 2020)
Which of the following is not a payment technique? (EO-2020, 2019)
a FERA 1947 b Inco terms 2020
c URC 522/ URR 725/ISBP 748 d UCP 600
546 As per UCP, documents must be submitted with (F-18)
*** 30 days after the day of shipment 21 days after the day of shipment.
14 days after the day of shipment 05 days after the day of shipment.
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547 Documents are in order in LC if documents are in accordance with – (E-16)
***
a LC terms b UCP 600
c ISBP 745 d All of the above
548 In UCP 600, Importer or Buyer is called as – (E-16)
***
a Beneficiary b Applicant
c Opening Party d All of the above.
549 Which of the is not an ICC regulation? (F-18)
***
FERA-1947 Incoterms
URC 522 UCDP 600
550 URR (Uniform Rules for Reimbursement under documentary credit) 725 (Total 17 articles) is the
*** regulatory frame work for (E-18, 17, F-19, 20)
a Reimbursement b Reimbursement in LC
c Bank to bank Reimbursement in LC operation d ash in advance
551 Exporter hands goods send to the country of importer which one inco-term 2020 means: (F-16, 17)
*** Exporters have maximum responsibilities in which of the following incoterm? (EO-2020)
a DDP (Delivery Duty Paid) b Ex-Work
c DAT d DAP
552 An exporter sells goods overseas on FOB and CIF Inco terms respectively. Who is responsible for the
*** freight and other charges in each (EO-2017)
a Importer (FOB)/Exporter (CIF) b Importer (FOB)/Importer(CIF)
c Exporter (FOB)/ Importer(CIF) d Exporter (FOB)/ Exporter (CIF)
553 Which of the following incoterms has been dropped by icc from the latest version? (F-20)
***
DAP DDP
DAT FOB
554* Which of the following incoterms has less risk and cost on the part of expoter? (F-20)
**
DDP FCA
FOB EXW
555* Which of the following is an ICC guideline? (E-16)
**
a FERA 1947 b Export Policy
c Import Policy d Incoterms 2020
556* Which one of the following guideline is not under ICC? (F-17)
**
FERA 1947 Inco terms 2010
C. UCP 600 URC 522
ISBP 748 URR 725
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557 In case of export, the responsibilities of exporter are minimum, in regards of Inco-Terms 2010 is:
*** (FAVP-2017)
FOB CFR
CIF CIP
558 Exporters hand over goods in importers country in which of the following inco terms (F-18)
***
In which of the following, exporter hands over goods in importer’s country? (EO-2020)
a EXW b FOB
c CPT d DAT (Delivered at Terminal)
559* In which of the following the responsibility of importer is the maximum? (EO-20, 19, F-20, 19, 18)
** a FCA (FAVP-2019) [Free Carrier (Rules for Any b DAT
Mode or Modes of Transportation,
INCOTERMS 2010)] (E-20)
c CFR d CIF
560 In case of import, the responsibilities of importer are maximum, in regards of Inco-Terms 2010 is:
*** (FAVP-2017, 20)
FOB CFR
CIF CIP
561 In case of Export, the responsibilities of exporter in the inco-terms 2010 is: (F-16, F-17)
***
a FOB b CFR
c CIF d CIP
562 In case of Import, the responsibilities of importer, in regards of inco-terms 2010 is: (F-16, F-17)
***
a FOB b CFR
c CIF d CIP
563 Who is responsible for issuing Bill of lading (EO-2017)
*** a Shipping company (Shipping Authority) b Shipping company agent (Shipping
Authority)
c Both (a) & (b) d None of these
564 Most commonly used transport documents is – (EO-2016)
*** a Airway Bill b Courier Receipt
c Bill of Lading d Railway Receipt
Note: A bill of lading is a legal document issued by a carrier to a shipper that details the type,
quantity, and destination of the goods being carried. A bill of lading is a document of title, a receipt
for shipped goods, and a contract between a carrier and shipper.
565 On transport documents which date is considered as the date of shipment: (E-20, AR)
***
a Date of issue of the transport document b Date of receipt of goods for shipment
c Day of shipped on board d Date of handing over the goods to
consignee
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566 An L/C that cannot be cancelled or amended without consent of the parties concerned is known as
*** (E-20)
a Confirmed L/C b Irrevocable L/C
c L/C d Back to Back L/C
567 Travel Quota for other than SAARC in Foreign Currency (FAVP-2017)
***
Personal travel quota for travelling abroad other than SAARC countries in a calendar year is (EO-
2020, FAVP-2018)
a USD 7000 b USD 5000
c USD 12000 d USD 3000
*** Annual travel quota for release of foreign currency for Non SAARC countries in a calendar year is-
USD 12,000.00 (E-14)
568 Legally, Nominated Bank is the agent of- (EO-2020, 2017, 2018, FAVP-2019, 2020)
*** a Issuing bank b Advising Bank
c Reimbursing Bank d Exporter
Note: The majority found that under UCP 600, a nominated bank can be an agent of the issuing
bank, to the extent of the issuing bank’s mandate.
569* Convertibility of currency means (EO-2020, 2015)
** a The ease with which a country’s currency can b The ease with which a country’s currency
be converted into gold can be converted into another currency
c The ease with which a cuntrys currency can be d Both A & B
converted into only US Dollar
570* Hedging means- (E-20)
**
Profit Maximization Risk minimization
Making investment to offset price fluctuation All of these
571 Making investment to offset price fluctuation– (2015, TD, FAVP-2017)
***
In the context of foreign exchange transaction, minimization risk means (EO-2020, 2016)
a Hedging b Arbitrage
c Speculation d None of the above
*** In the context of Foreign Exchange transaction Hedging is a counter action for the purpose of –
Minimization Risk (F-17)
What is Hedging: Hedging is a financial strategy that should be understood and used by investors
because of the advantages it offers. As an investment, it protects an individual’s finances from being
exposed to a risky situation that may lead to loss of value. However, hedging doesn’t necessarily
mean that the investments won’t lose value at all. Rather, in the event that happens, the losses will
be mitigated by gains in another investment.
Hedging is recognizing the dangers that come with every investment and choosing to be protected
from any untoward event that can impact one’s finances. One clear example of this is getting car
insurance. In the event of a car accident, the insurance policy will shoulder at least part of the repair
costs.
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Examples of hedging strategies: 1. Diversification, 2. Arbitrage, 3. Average down, 4. Staying in cash
In the context of foreign exchange transaction hedging is a counter action for the purpose
of=Minimization Risk. (F-16), The Opposite of Hedging is Speculation.
Hedging: Hedging considered as a financial toll, a strategy to reduces the risk. Hedging is very simple
to understand but still unpopular among the beginners in the market. The aim of hedging is to
reduce the losses from unexpected fluctuation arises in the market.
572 For export bill purchase under LC we use (E-20, 15, F-18)
*** a OD sight b TT clean
c TT Doc d OD Transfer
573 Which of the following exchange rate is applicable for LC-(EO-2017)
*** a OD sight b TT clean
c TT doc d TT docselling
574 Commercial Invoice is issued by (EO-2020, 2018, 2017)
*** a Applicant b Importer
c Issuing Bank d Exporter (EO-20,18)/Beneficiary (E-17)
Note: The seller or the exporter issues commercial invoices to the buyer or the importer. The invoice
acts as proof of sale.
575 Back to Back LC is a - (E-18)
***
a Financing Technique b Method guided by UCP 600
c Payment technique d Method guided by URC 522
576* Which one of the following is a financing technique: (E-16).
**
Irrevocable LC Revocable LC
Back to Back LC None of the above
577* Speculation means (F-18)
**
Targeting profit by undertaking risk Making investment to offset price
fluctuation
Risk minimization All of the above
578 Who are the main parties of a confirmed credit (EO-2019, 2017)
*** a Issuing bank b Confirming bank
c Beneficiary d All of above
Legally Beneficiary/Exporter and Issuing Bank (or in case of confirmed credit also confirming bank)
are the main parties the entire parties of Documentary Credit genearlly are: 1.
Importer/Buyer/Applicant, 2. Exporter/Seller/Benificiary/Shipper/Consignor, 3. Opening/Issuing
Bank, 4. Advising Bank, 5. Confirming Bank, 6. Negotiating Bank/Nominated Bank/Paying Bank, 7.
Reimbursing Bank.[Buyer Bank (Issuing Bank) & 8. Seller Bank (Advising/Confirming Bank)].
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579* Advising Bank is the agent of (E-19, AR)
**
a Remitting Bank b Collection Bank
c Issuing Bank (E-19)/The correspondent bank d Opening Bank
of issuing bank
580* Issuing Bank can Never be an/a (F-20)
**
Advising Bank Negotiating Bank
Confirming Bank All of the above
581 Which of the following is not true in international banking? (EO-2019, F-19)
***
a DA involves higher risk to an exporter than DP b Open account is the most popular payment
method in the globe
c An issuing bank can be an advising bank as d An issuing bank may directly advise a credit
well to the beneficiary
582* Which of the following is getting popularity as trade financing tool- (EO-2018)
**
a LTR b UPAS (Usance Payable at Sight)
c BPO d LIM
UPAS L/C can enjoy only manufacturer/Industrial Unit only (It is one kind of Refinancing and Tenor
180 days, they should have Bonded ware House License).
UPAS LC is an Usance LC where payment is made on a sight basis to the exporter (beneficiary) but
the payment of the buyer (applicant) will be made to issuing bank at the usance term. ... Buyers
Credit are using as a source of finance to settle the LC payment.
583* Charges of the advising bank is commonly beard by- (EO-2018, 2017)
** a Issuing bank b Importer
c Exporter (E-17)/Beneficiary (E-18) d Nominated bank
Note:In real life situations, the applicant pay only the issuing bank’s charges and remaining bank
charges will be paid by the beneficiary unless the beneficiary is in a very strong position against the
applicant.
584* Under which method of Payment an ------------------ has obligation to make payment against
** complying presentation? (F-20)
Open an Account Documentary collection and stand by LC
Documentary credit stand by LC and Demand Open an account & demand guarantees
Guarantees
585 In LC process documents are examined following the standard of (EO-2018)
***
a Honour b Negotiation
c Complying Presentation d None of the above.
586 Nominated bank cannot be- (FAVP-2018)
***
an Issuing Bank An advising Bank
a negotiating bank a confirming bank.
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587 In LC Bill of Exchange may be drawn on (FAVP-2018)
***
Importer Issuing Bank
Applicant Any of the party as required by LC
Parties to Bill of Exchange (section 7): 1. Drawer/writer/maker: Every person capable to contract
under section 11 of the Contract Act, 1872. Under section 30 of the Negotiable Instruments Act,
1881, Drawer agrees that Bill of Exchange shall be accepted on presentment and in case of dishonor
he shall be liable to compensate to the payee/endorser. 2.
Drawee/bank:
3. Payee/endorsee/acceptor: Payee is a person who accepts the bill.
Parties to Bill of Exchange: There are 3 parties involved in a typical bill of exchange transaction.
Drawer of a Bill of Exchange: Is the party that issues a Bill of Exchange in an international trade
transaction; usually the seller or exporter. Drawee of a Bill of Exchange: Is the recipient of the Bill of
Exchange for payment or acceptance in an international trade transaction; usually the importer, the
issuing bank or the confirming bank. Payee of a Bill of Exchange: Is the party to whom the Bill is
payable; usually the seller or his bank such as the advising bank. (Source: aib trade finance)
Step 1 : The exporter (drawer) draws the bill of exchange on the issuing bank (drawee) and send it to
the issuing bank for acceptance through the advising bank. Step 2 : The issuing bank (drawee)
accepts the bill of exchange and makes the payment to the advising bank (payee) at maturity. Step 3
: The advising bank transmits the payment to the exporter (drawer).
588 Foreign exchange SWAP means (EO-2020, 2015)
*** a SELLING ONE CURRENCY AGAINST ANOTHER b SALE WITH A PURCHASE OF THE SAME
CURRENCY CURRENCY/(E-2020, F-16, F-17)
c SWITCHING ONE CURRENCY WITH ANOTHER d ALL OF THE ABOVE
CORRENCY
589 Foreign Exchange SWAP means (F-18, F-17, E-20)
*** Combating spot against forward selling one currency against another
currency
switching one currency with another currency all of the above.
Note: What Is a Foreign Currency Swap: A foreign currency swap, also known as an FX swap, is an
agreement to exchange currency between two foreign parties. The agreement consists of swapping
principal and interest payments on a loan made in one currency for principal and interest payments
of a loan of equal value in another currency. One party borrows currency from a second party as it
simultaneously lends another currency to that party.
590 Nominated bank is the choice of- Exporter (F-18)
***
In LC process the nominated bank is (E-17)
a Advising bank choice b Importer’s choice
c Reimbursing bank choice d Exporter’s choice
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591 Which of the following banks purchase/discounts export bill under LC? (E-14, F-16, 17)
***
a Issuing Bank b Advising Bank
c Nominated Bank/Negotiation d Reimbursing Bank
592* An exchange rate is the price of (E-17)
**
a Local currency in terms of foreign currency b Foreign currency in terms of Local currency
c Other currency expressed in terms of another d All of these
currency
593 A credit opened on the basis of an original credit in favour of another beneficiary is called- (E-17)
***
a Revolving credit b Security credit
c Back to back credit d Transferrable credit
594 Back to Back LC should be- (EO-2017)
***
a Sight LC b Usance LC
c Stand by LC d All of the above
Validity of Usance LC: 30, 60, 90, 120, 180
Back-to-Back Letter of Credit Definition. Back-to-Back Letter of Credit is a negotiable instrument in
which the seller gets a Letter of Credit from the buyer and the seller further transfers the Letter of
Credit to its supplier.
595 Of the following which one is the most popular type of LC in Bangladesh? (E-16)
***
a Revocable LC b Transferable LC
c Standby LC d Red Clause LC
596* An LC has been opened for two months. The expiry date of the LC is to be counted from (F-20)
**
Date of issuance date of Shipment
date of negotiation 21 days after the date of shipment
597* Who is responsible for the charges of a presenting bank (F-20)
**
Beneficiary Principal
Collecting Bank Importer
598* Which of the following is not a risk faced by benificiary is a documentary bank? (F-20)
**
Failure of the issuing bank failure of the benificary to prepare
complaint documents
Failure of the applicant to pay Failure of the issuer in the event that the
documentary credit is issued by non bank
599* Remittances received against exports of goods should be certified and reported on… (tick
** appropriate answer) (E-14)
Advance cash receipt voucher IMP form
EXP form
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600* An incoming person may retain foreign exchange exceeding USD 5000 brought in by him/herself by
** making a written declaration in form of: (E-14)
FMJ FMG
FMIF None of above
601 The main service of the Offshore Banking Units in the country is – (EO-2016)
***
a Financing A Type Industry in EPZs b UPAS LC services
c Supporting B and C Type Industries in EPZs d Financing C TypeIndustries in EPZs
Note: Enterprise in the country may also enjoy FC loan from the OBU at lower interest rate subject to
the approval of the Board of Investment. OBU can finance mainly to Fully Foreign Owned Companies
at home and abroad, A-Type Farms/Companies in EPZ territory and in limited cases to Joint
Venture/Local Industrial unit in Bangladesh in the form of term investment provided permission
from Board of Investment (BOI).
602 LCAF (Letter of credit authorization form) means (EO-2016, AR)
***
a Letter of credit application form b Letter of credit authorization form/Refers
to authorization for effecting payment of
import bill in foreign currency
c Letter of credit application form d Letter of credit authorization form
Note: LCAF stands for Letter of Credit Authorization Form. It is mainly application for permission for
opening LC as well as importing of goods into Bangladesh and remittance there against. So it is used
for opening LC, releasing goods and remittance there against. It is used to allow opening LC (Letter of
Credit) to import from abroad. Though LCAF is required for the opening of LC, this is required, in
some cases, for import without LC as per IPO (Import Policy Order), Bangladesh.
Letter of Credit Authorization Form (LCAF) has three types of validity: i) Validity for opening LC-
within 180 days of issuance (Para 8(8) of Import Policy Order, 2015-18). ii) Validity for
shipment- 17 months for capital machinery and 9 months for other items from the date of
issuance (Para 8(9) of Import Policy Order, 2015-18). iii) Validity for payment-
18 months subsequent to the month of issuance for capital machinery and 12 months for other
items (Para 3(c), Chapter 7, Guidelines for Foreign Exchange Transactions Vol-1).
603 According to EXP, proceed needs to be realized within – (E-16)
***
a 8 months b 5 months
c 4 months d 3 months
604 Import policy order and Export Policy Order (2015-2018) are published by ( Import and Export
*** Control Act, 1950 )– (E-16)
Import & Export policy is issued by
a Ministry of Finance b Ministry of Commerce
c Central Bank d None of the above
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605 In Bangladesh LC can be issued by –(E-16)
***
a IDLC b Grameen Bank
c Authorized Dealer d Bangladesh Bank
606* If a credit states first shipment is to be effected on or about 20 august 2010 this means shipment can
** be effected during the period (2015)
a 14 August- 15 August b 15 August- 26 August
c 15 August- 25 August d 16 August- 25 August
607 For payment against imports the prescribed application form is ………..(2015)
***
a Form TM b Form EXP
c Form IMP d
Application for remittance on Form IMP: (a) Form IMP for private imports: All applications for
payments against imports into Bangladesh (including imports by enterprises of EPZs/EZs from
abroad) should be made on form IMP with separation of FOB value, freight, insurance and other
charges (See Appendix 5/16). The form IMP shall be submitted in one original by the importer or his
duly authorized representative. In cases where empowered to approve the remittances on behalf of
the Bangladesh Bank, the AD shall endorse its approval on the reverse of the form IMP in the space
provided for the purpose. In other cases, the AD shall submit the form IMP together with required
supporting documents to the Bangladesh Bank for approval.
(b) Form IMP for government imports: The AD should mark with a bold letter "G" the IMP
form for remittance against an import in the name of a government department or office for
which LCs are opened by the AD. In other cases, where LCAFs are issued to private parties and are
marked "On Government Account", the form IMP should be similarly marked with bold "G".
608 Under AMU Ads. May open Nostro accounts in which currencies (2015)
***
a ACU (Asian Clearing Union) Dollar b ACU Yen
c ACU GBP d ACU Euro
Note: ADs shall maintain nostro accounts in AMUs ( ACU Dollar, ACU Euro) with their correspondent
banks in ACU member countries for the purpose of settlements through ACU. Similarly accounts in
AMUs (ACU Dollar and ACU EURO) may be opened by the ADs in their books in the names of their
correspondents in ACU member countries. ADs may pay interest on the balance of Nostro Accounts
in AMUs as per mutually agreed terms and conditions with the correspondent(s). NOSTRO A/c: Our
Account with you. & Vostro A/c: Your Account with us.
609 Maximum Tenor of a ULCBB is (E-15)
*** a 90 Days b 120 Days
c 150 Days d 180 Days
The tenor of each advance is normally 90 days but the maximum tenor should not normally exceed
180 days. Value addition as per IPO: Knit-20%, Woven-20%, High Cost (Quota)-15%, High Cost (non
Quota)- 10%, Sweater-20% & Baby Garments-15%.
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610 Exchange rate means: (E-15)
***
a The value of one currency for the purpose of b The rate for exchanging commodity
conversion to another
c The rate for exchanging gold d All of the above
611 International ERQ (Exporters’ Retention Quota) cards may be issued in favour of top executives of an
*** exporting firm/organization holding ERQ accounts, the maximum number of executives are: (E-15)
a 3 b 4
c 5 d 6
Note: International Credit/Debit Card may be issued against the balances held in the exporters'
retention quota (ERQ) foreign currency account as per entitlement mentioned in Para 28, Chapter 13
of this Guidelines. International cards may be issued in favour of upto three (3) top level executives
of an exporting firm/organisation holding ERQ accounts. An exporting firm/organisation may avail of
the card facility from one card issuing bank only. It will be upto the card issuing bank to accept
or decline a request from an ERQ account holding exporting firm/organisation for issuance of
international cards. Cards issued against ERQ accounts may be used only for meeting the bonafide
business purposes of the exporting firm/organisation as mentioned in Para 29(i), Chapter 13 (
Section - IV) of this Guidelines.
612* SWIFT stand for: Society for Worldwide Interbank Financial Telecommunication (E-2015). The
** Society for Worldwide Interbank Financial Telecommunication (SWIFT), legally S.W.I.F.T. SCRL, is a
Belgian cooperative society that serves as an intermediary and executor of financial transactions
between banks worldwide. It also sells software and services to financial institutions, mostly for use
on its proprietary "SWIFTNet", and ISO 9362 Business Identifier Codes (BICs), popularly known as
"SWIFT codes".
SWIFT does not facilitate funds transfer: rather, it sends payment orders, which must be settled by
correspondent accounts that the institutions have with each other. To exchange banking
transactions, each financial institution must have a banking relationship by either being legally
organized as a bank or through its affiliation with at least one bank. While SWIFT transports financial
messages in a secure manner, it does not hold accounts for its members nor performs any form of
clearing or settlement.
613 EDF (Exporter Development Fund) interest rate: (2015)
***
a 6 month LIBOR + 1.5% b 6 month LIBOR + 2.00%
c6 Month LIBOR (London Inter-Bank Offered d 6 month LIBOR + 3.00%
Rate) + 1.5%
614* Total currency export of the country is (2015)
** a 31.20 Billion for the year 2014-2015 b 34.00 Billion for the year 2015-2016
c 30.60 Billion for the year 2017-2018 d
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615 Gross profit ratio for a firm remains same but the net profit ratio is decreasing. The reason for such
*** behavior could be: (E-15)
a Increase in costs of goods sold b If increase in expenses
c Increase in dividend d Decrease in sales
Note: Gross profit ratio is a profitability ratio that shows the relationship between gross profit and
total net sales revenue. It is a popular tool to evaluate the operational performance of the business.
The net profit percentage is the ratio of after-tax profit to net sales.
616 Which documents is must for getting the permission by the customs for the export of goods by sea
*** or air (E-15)
a SDF b SOFTEX
c Shipping Bill d Commercial Bill
Note: At seaport/airport: Shipping bill, At land customs station: Bill of export, For goods
transhipment: Bill of transhipment.
Must-have Shipping Documents for Exports:
1. Bill of Lading: The most important document in the shipping process for exporters. A bill of lading
(lading is the act of putting cargo on a ship) is a legal document that must be signed by the exporter,
the shipping line and the importer. For smooth transportation of goods from origin to destination,
the exporter must obtain a correct and complete bill of lading from the shipping line/freight
forwarder and send it to the importer.
2. Commercial Invoice cum Packing List: A commercial invoice is a contract of sale issued by the
exporter to the importer. It helps customs determine the value of the goods to assess the duties and
taxes due on them.
3. Shipping Bill/Bill of Export: A shipping bill or bill of export is a document submitted by the
exporter in the form of an application to obtain clearance from customs. It informs customs of
whether the exporter has availed of government incentives, such as: i).Exemptions/rebates/refunds
on various taxes, duties. ii). Benefits under various government export schemes
Must-have Shipping Documents for Imports:
1. Bill of Lading: This is the most important document not only for exporters but for importers too.
The exporter must share the bill of lading with the importer, who cannot receive the goods at his
end without it.
2. Commercial Invoice cum Packing List: Again, the importer needs this document just as much as
the exporter. This is because the commercial invoice cum packing list comes into play at the all-
important time of customs clearance.
3. Bill of Entry: The third must-have document for importers is a bill of entry. It is a declaration by
the importer on the basis of which customs authorities at the port of entry inspect and clear the
goods. The information in this bill is tallied with the sales invoice or insurance policy.
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617 NOSTRO account is – (E-20, 14)
***
A bank’s account with a correspondent A bank’s account with a correspondent
bank/branch abroad in the home currency of bank/branch abroad in foreign currency.
that country
A bank’s account with a correspondent A local currency account of a foreign
bank/branch abroad in account holder bank/branch
currency
What Is a Nostro Account: A nostro account refers to an account that a bank holds in a foreign
currency in another bank. Nostros, a term derived from the Latin word for "ours," are frequently
used to facilitate foreign exchange and trade transactions. The opposite term "vostro accounts,"
derived from the Latin word for "yours," is how a bank refers to the accounts that other banks have
on its books in its home currency.
What Is a Vostro Account: A vostro account is an account a correspondent bank holds on behalf of
another bank. These accounts are an essential aspect of correspondent banking in which the bank
holding the funds acts as custodian for or manages the account of a foreign counterpart. For
example, if a Spanish life insurance company approaches a U.S. bank to manage funds on the
Spanish life insurer's behalf, the account is deemed by the holding bank as a vostro account of the
insurance company.
618 A credit requires an “Invoice” without further definition. Which of the following “MUST” be
*** considered a discrepancy? (E-14)
Presentation of a document identified as a tax An invoice which is not signed
invoice
An invoice made out in a different currency to An invoice issued for an amount in excess
the credit of that permitted by the credit
619 In case the importer is new customer, the AD should obtain certificate from the AD through which
*** the applicant imported earlier to the effect that no ……… is …….. for submission by the importer. (E-
14)
Bill of lading & due Bill of exchange & overdue
Bill of entry & overdue
620 Which of the following is the major foreign currency earner in the country? (EO-2016)
***
a Leather b Handicraft
c RMG d Agricultural Commodities
621 Standby LC is guided by (F-20)
*** Incoterms 2020 URC 522
ISBP 745 None of the Above
Note: The global rule sets which govern standby letters of credit (SBLC) - both the Uniform Customs
and Practices current revision 600 (UCP 600) and International Standby Practices current revision
(ISP98) - define a SBLC as an “undertaking”. An undertaking provides the named beneficiary with an
“independent” assurance of payment from the undertaking’s issuer (issuers are most often banks).
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Previous year questions (without GK, ClassifiCation, resChedulinG and ProvisioninG)

5 The rate of interest payable on various deposits is determined by the: (E-16, G)

c Association of Banker’s Bangladesh d Bangladesh Bank

a Power of attorney b Standing instructions

13 Can illiterate person be issued debit card (C-18, 17)

63 Which one the following is not a method of money laundering? (C-21)

Artificial Person Undesirable Person

Letter of guarantee Letter of indemnity

a Guarantee bond b Treasury bond

a Offline clearing b BACH

Demand draft Payment order

224 Payment order can be encashed from- (C-21)

Quality weighting schemes Risk weighting schemes

Reduces costs Manages risks

2.90 [LADG = (Duration Assets - Duration 1.82

a BDT 1.92 b BDT 1.00

BANK DISCOUNT RATE YIELD TO MATURITY

a 27 (Ka Ka) "List of Defaulting Borrowers" b 15 (Ka Ka)

516* Which of the following is true? (EO-2019, FAVP-2019)

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