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    Question

    Which of the following transactions will result in a

    Fund Based exposure for a Bank?  
    A Advising a Letter of Credit Correct Answer Incorrect Answer
    B Booking a Forex Forward Contract for export receivables Correct Answer Incorrect Answer
    C Collection of export documents under a Letter of Credit Correct Answer Incorrect Answer
    D Discounting export documents under a Letter of Credit Correct Answer Incorrect Answer
    E All of the above Correct Answer Incorrect Answer

    Solution

    Fund based business means a business transaction that leads to immediate flow of funds to borrowers of the bank. These are overdraft, Cash Credit, Bill finance, discounting of bills, term loans.  

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