KIRAN E  KE

National Institute of
Bank Management
Dashboard  My courses  CRD MGMT  MODULE II : CREDIT OPERATIONS  EOM II: TEST: 10-03-2024

CREDIT MANAGEMENT EOM II: TEST: 10-03-2024

Started on Sunday, 10 March 2024, 1:15 PM

State Finished
Completed on Sunday, 10 March 2024, 2:15 PM
Time taken 1 hour
Grade 37.50 out of 60.00 (62.5%)
Question 1 Correct Mark 0.50 out of 0.50

Bank loans to PACS and LAMPS are recognized as

Select one:

a. Farm credit
b. Agriculture infrastructure
c. Ancillary activities
d. None of the given options

Question 2 Correct Mark 0.50 out of 0.50

Banks are mandated not to accept collateral security from micro and small enterprises for loans
up to

Select one:

a. Rs 15.0 lakhs
b. Rs 10.0 lakhs
c. Rs 5.0 lakhs
d. Rs 20.0 lakhs
Question 3 Correct Mark 0.50 out of 0.50

Which one of the following committees proposed adoption of cluster based approach for financing
MSME sector

Select one:

a. Ganguly Committee
b. Nayak Committee
c. Chakrabarty Committee
d. Kapur Committee

Question 4 Correct Mark 0.50 out of 0.50

Which one of the following is necessary for banks in order to offer a clean loan

Select one:

a. Purpose to be clearly specified

b. Guarantor
c. Primary security
d. Secondary security
Question 5 Correct Mark 0.50 out of 0.50

Banks are required to report credit information to CRILC on all borrowers having aggregate
funded/non funded exposure

Select one:

a. Rs 1 crore and above

b. Rs 2 crore and above
c. Rs 5 crore and above
d. Rs 10 crore and above

Question 6 Correct Mark 0.50 out of 0.50

For taking over a home loan, a bank must ensure that

Select one:

a. Borrower is a deposit customer of the bank

b. Borrower is residing in the property
c. The loan is provided by another bank only
d. The loan is a standard asset
Question 7 Correct Mark 0.50 out of 0.50

The number of debits in a month in KCC is limited to

Select one:

a. 25
b. 15
c. No limits
d. 20

Question 8 Correct Mark 0.50 out of 0.50

What does the acronym EPC stands for

Select one:

a. Engineering and Purchase Contract

b. Engineering and Project Company
c. Engineering, Procurement and Construction
d. Engineering and Procurement Consultants
Question 9 Correct Mark 0.50 out of 0.50

Which one of the following is a internal source of finance for a corporate

Select one:

a. Leasing
b. Hire purchase
c. Bank loan
d. Debt collection

Question 10 Incorrect Mark 0.00 out of 0.50

Which one of the following is not included in the calculation of MCLR

Select one:

a. Risk premium
b. Marginal cost of borrowings
c. Return on networth
d. Tenor of the loan
Question 11 Incorrect Mark 0.00 out of 0.50

Which one of the following is not required for the appraisal of a housing property

Select one:

a. Map of the property

b. Title deed
c. Approved plan by local body
d. Registered sale agreement

Question 12 Correct Mark 0.50 out of 0.50

Which one of the following must be the last repayment as per the the Waterflow Diagram for a
project

Select one:

a. Reserves
b. Service debt
c. Service interest
d. Available for shareholders
Question 13 Correct Mark 0.50 out of 0.50

Which one of the following retail loans does not require disclosure of income by borrower

Select one:

a. Home loan
b. Vehicle loan
c. Gold loan
d. Credit card

Question 14 Correct Mark 0.50 out of 0.50

Except one of the following, all other Retail Loans are sanctioned and disbursed for a specified
purpose

Select one:

a. Home Loan
b. Credit Card
c. Educational Loan
d. Vehicle Loan
Question 15 Correct Mark 0.50 out of 0.50

Usually Banks due diligence about the Applicant "DOES NOT" cover

Select one:

a. Verification of documents required under KYC

b. Verification of the occupation of the Applicant
c. Verification of the occupation of the liabilities of the Applicant
d. Verification of the health condition of the Applicant

Question 16 Correct Mark 0.50 out of 0.50

Which one of the following is a "Revolving Credit"?

Select one:

a. Jewel Loan
b. Salary Loan
c. Loan against Bank's Own Fixed Deposit
d. Credit Card
Question 17 Correct Mark 0.50 out of 0.50

Which one of the following is "NOT a Fixed Term" Credit?

Select one:

a. Overdraft Facility against Fixed Deposit

b. Housing Loan
c. Educational Loans
d. Vehicle Loans

Question 18 Correct Mark 0.50 out of 0.50

Which one of the following is "NOT TRUE" regarding the repayment of a Retail loan ?

Select one:

a. It is recovered either through EFT mandate or PDCs

b. It is recovered in EMI
c. It is linked to the source of Income
d. It is linked to the Net worth of the borrower
Question 19 Incorrect Mark 0.00 out of 0.50

Usually one of the following charges is "NOT" levied for Fixed Term Retail Credit

Select one:

a. Processing Fees
b. Prepayment Charges
c. Delayed Repayment Charges
d. Commitment Charges

Question 20 Correct Mark 0.50 out of 0.50

DRA in the process of recovery of loans means

Select one:

a. Debt Restructuring Agency

b. Debt Reassessment Agents
c. Debt Recovery Agents
d. Debtor Rehabilitation Arrangement
Question 21 Incorrect Mark 0.00 out of 1.00

For which one of the following is the cover under CGTMSE is not available:
(i) Self Help Groups
(ii) Retail traders
(iii) Educational institutions
(iv) All the above

Select one:

a. (i) only
b. (iii) only
c. (ii) only
d. (iv) only
Question 22 Incorrect Mark 0.00 out of 1.00

A bank must invoke the guarantee in respect of credit facility from date of NPA, and after lock-in
period, within a maximum period of

Select one:

a. 60 days
b. 180 days
c. 90 days
d. One year

Question 23 Correct Mark 1.00 out of 1.00

For arriving at the crop loan limit under KCC, what is the additional increase over cost of cultivation
allowed for the purpose of farm maintenance

Select one:

a. 20%
b. 10%
c. 15%
d. 25%
Question 24 Correct Mark 1.00 out of 1.00

In which one of the following retail loans is the primary security is not the asset purchased with the
loan

Select one:

a. Vehicle loan
b. All the given options
c. Home loan
d. Gold loan

Question 25 Correct Mark 1.00 out of 1.00

Service fee is paid to the credit guarantee fund trust by the

Select one:

a. Both borrower and bank

b. There is no service fee
c. Individual borrower
d. Lending bank
Question 26 Correct Mark 1.00 out of 1.00

The JLA scheme is applicable for lending to a single borrower with aggregate credit limits

Select one:

a. Rs 250 crores and above

b. Rs 150 crores and above
c. Rs 100 crores and above
d. Rs 200 crores and above

Question 27 Correct Mark 1.00 out of 1.00

What is the minimum share of a lending bank under Joint Lending Arrangement if the working
capital limit is upto Rs 1000 crores

Select one:

a. 15%
b. 5%
c. 10%
d. 20%
Question 28 Correct Mark 1.00 out of 1.00

Which one of the following is considered to be an allied activity for the purpose of bank credit to
agriculture

Select one:

a. Dairy farming
b. Cold storage development
c. Watershed development
d. Vermi-composting

Question 29 Correct Mark 1.00 out of 1.00

Which one of the following is not a feature available to a project company in a BOT model

Select one:

a. Operating the facility

b. Transferring the project
c. Owning the facility
d. Raising the required finance
Question 30 Correct Mark 1.00 out of 1.00

Which one of the following is not likely to impact the credit score of a borrower

Select one:

a. Number of inquiries
b. Credit utilization rate
c. Annual income
d. Payment history

Question 31 Correct Mark 1.00 out of 1.00

According to RBI guidelines, what is the minimum of infrastructure loan eligible for takeout
financing

Select one:

a. Rs 5000 crore
b. Rs 1000 crore
c. Rs 2500 crore
d. Rs 500 crore
Question 32 Incorrect Mark 0.00 out of 1.00

Bank can disburse part of housing loan to a builder based on

Select one:

a. Any of the given options

b. As per agreement
c. As per stage of completion
d. As per demand made by builder

Question 33 Correct Mark 1.00 out of 1.00

Creation of charge against the security of movable assets, wherein the possession of the security
remains with the borrower itself is known as

Select one:

a. Possession
b. Pledge
c. Hypothecation
d. Mortgage
Question 34 Correct Mark 1.00 out of 1.00

In order to become eligible for a bank loan, the minimum credit score that a borrower must obtain
in CIBIL Report is

Select one:

a. 450
b. 750
c. 600
d. 500

Question 35 Correct Mark 1.00 out of 1.00

In which one of the following retail loans can the borrower pay the entire interest and principal at
the end of the tenure

Select one:

a. Gold loan
b. Personal loan
c. Home loan
d. Vehicle loan
Question 36 Correct Mark 1.00 out of 1.00

Margin for education loan of greater than Rs 4 lacs for study in India is

Select one:

a. 10%
b. Nil
c. 15%
d. 5%

Question 37 Correct Mark 1.00 out of 1.00

The acronym PERT for a project relates to

Select one:

a. Project Management
b. Project Ownership
c. Project Revenues
d. Project Finance
Question 38 Correct Mark 1.00 out of 1.00

The CGTMSE scheme is a

Select one:

a. Closed scheme
b. Targeted scheme
c. Open scheme
d. Limited scheme

Question 39 Incorrect Mark 0.00 out of 1.00

The insurance premium under KCC is shared between the bank and borrower in the ratio of

Select one:

a. 1:2
b. 1:1
c. 2:1
d. 1:3
Question 40 Incorrect Mark 0.00 out of 1.00

The main purpose of setting up an SPV for a project is

Select one:

a. Create a company for a new line of business

b. Insulate the sponsor company from any risks arising in the project
c. Bring together project management expertise
d. All the given options

Question 41 Correct Mark 1.00 out of 1.00

Which of the following information is not the purpose of a Search Report

Select one:

a. Verifying the status of construction on a property

b. Verifying the current ownership of a property
c. Verifying the existence of a property
d. Verifying the history of transfer of a property
Question 42 Incorrect Mark 0.00 out of 1.00

Which of the following insurance is not available with a KCC

Select one:

a. Health Insurance
b. Accident Insurance
c. Crop Insurance
d. Life Insurance

Question 43 Correct Mark 1.00 out of 1.00

Which one of the following mode of finance is most closer to renting a asset

Select one:

a. Trade credit
b. Leasing
c. Mortgage
d. Hire purchase
Question 44 Incorrect Mark 0.00 out of 1.00

Which one of the following types of risk does the CPM method aim to manage

Select one:

a. Cost overrun
b. Time overrun
c. Ancillary supplies
d. Offtake risk
Question 45 Incorrect Mark 0.00 out of 1.00

Which one of the following is "NOT" a reason for Banks to be keen to extend the Retail Loans ?

Select one:

a. Specific appraisal expertise is not required since the Retail Loans are appraised on 'score card
basis'

b. Repayment is linked to the known source of Income

c. Credit Risk is evaluated easily due to the structured appraisal methods

d. The Rate of Interest on Retail Loans is Higher than the Business loans

Your answer is incorrect.

Question 46 Incorrect Mark 0.00 out of 1.00

Which one of the following cannot be said to be a factor behind the explosive growth of retail
credit in India

Select one:

a. Increase in household income

b. RBI directives forcing the banks to lend more to retail segment
c. Robust and consistent growth of Indian economy
d. Demographic dividend i.e. proportion of working population in the total population is high

Question 47 Incorrect Mark 0.00 out of 1.00

Which one of the following is "NOT" a source for verification of the financial liabilities of the
Applicant?

Select one:

a. Income Certificate (salary slip)

b. Copy of Pan card
c. Applicant's Assets & Liabilities Statement
d. Statement of Bank Account
Question 48 Correct Mark 1.00 out of 1.00

Margin means the amount to be contributed by the borrower as part of the

Select one:

a. The process fees of the Bank

b. Resalable value of the asset financed
c. Invoice/Purchase/Market price of the asset financed
d. Sanctioned loan amount

Question 49 Incorrect Mark 0.00 out of 1.00

Which one of the following is "NOT" a feature of 'Revolving'credit facility ?

Select one:

a. The sanctioned credit limit gets automatically reinstated after each operation
b. Allows multiple withdrawals within the sanctioned credit limit
c. Allows multiple deposits in the credit account
d. The interest is charged on the Sanctioned limit
Question 50 Correct Mark 1.00 out of 1.00

Generally the Interest is charged "Uniformly" to all borrowers availing the same category of retail
loan (same portfolio) NOT because

Select one:

a. The relative value of individual account is small

b. It is a market strategy decision to charge uniform interest for all borrowers in one portfolio
c. The cost of evaluating the risk perception of each account is prohibitive
d. The risk of the portfolio is passed on to all the borrowers irrespective of risk attached to individual
borrower

Question 51 Correct Mark 2.00 out of 2.00

Which one of the following can be the action taken for force majeure events in a project

Select one:

a. Standby debt and equity available from sponsors

b. Cash flows stress tested under downside scenarios
c. All the given options
d. Financial protection from insurers
Question 52 Correct Mark 2.00 out of 2.00

According to Nayak Committee method, working capital credit limits may be computed as
minimum 20% of their estimated annual turnover for SSI units whose credit limit is upto

Select one:

a. Rs 7.5 crore
b. Rs 10 crore
c. Rs 5 crore
d. Rs 2 crore

Question 53 Correct Mark 2.00 out of 2.00

Pari-passu charge in regards to the assets of a borrowing company means

Select one:

a. Equal rights for charge

b. Equal rights for charge and proportionate amount
c. Equal rights for charge and equal amount
d. None of the given options
Question 54 Correct Mark 2.00 out of 2.00

Partial credit enhancement is essentially a

Select one:

a. Working capital loan

b. Term loan
c. Bridge loan
d. Contingent line of credit

Question 55 Incorrect Mark 0.00 out of 2.00

The Title Deed is different from a Sale Agreement in regards of

Select one:

a. Registration with Land Registry Office

b. All the given options
c. Counter parties related to the property involved
d. Transfer of ownership of the asset
Question 56 Incorrect Mark 0.00 out of 2.00

Which one of the following is the correct representative for FOIR

Select one:

a. Equated Monthly Installment to Gross take home salary

b. Equated Monthly Income to Net take home salary
c. Equated Monthly Installment to Net take home salary
d. Equated Monthly Income to Gross take home salary

Question 57 Correct Mark 2.00 out of 2.00

Usually the common conditions for an individual to be eligible for Retail Loan "DOES NOT" include

Select one:

a. Should have source of Income

b. The borrower could be an individual or more than one individual jointly
c. A borrower must be an Indian citizen
d. Should have Indian Passport
Question 58 Incorrect Mark 0.00 out of 2.00

Which one of the following is the "MOST" important factor considered by Bank while doing Due
Diligence of the Guarantor ?

Select one:

a. Verification of the occupation

b. Verification of the income
c. Verification of documents required under KYC
d. The Net worth

Question 59 Incorrect Mark 0.00 out of 2.00

Exceptionally some Banks charge Differential Rate of Interest for borrowers in one portfolio based
on

Select one:

a. As a marketing strategy to attract a particular class of borrowers such as Senior

citiens,Women,etc.
b. Larger down payment than the minimum prescribed by the Bank
c. Individual Risk perception linked to credit score
d. The political affiliation of the borrower
Question 60 Incorrect Mark 0.00 out of 2.00

Which one of the following is "NOT TRUE" regarding the Bank's Loan documentation?

Select one:

a. It is a process of drawing the written agreement of terms & conditions of the loan extended
b. It attracts stamp duty
c. It does not offer choice to the customer to modify any wording in the document
d. It is filled in by the Bank officials after the disbursement of the loan

◄ Chapter 7: Indian
Accounting Standards (Ind
AS) converged with Chapter 1:
Jump to...
International Financial Documentation ►
Reporting Standards
(IFRS)