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      Question

      Which of the following transactions will result in a

      Fund Based exposure for a Bank? Β 
      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. Β 

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