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      Question

      In the context of constitution of the Risk Management

      Committee of the Board (RMCB) in a financial institution, the Chairperson of the Board intends to become a member of the RMCB. Which of the following conditions must necessarily be satisfied for such membership to be permissible?
      A The Chairperson must also be the CEO of the entity Correct Answer Incorrect Answer
      B The Chairperson must have prior approval of RBI Correct Answer Incorrect Answer
      C The Chairperson must possess requisite expertise in risk management Correct Answer Incorrect Answer
      D The Chairperson must not be part of any other Board committee Correct Answer Incorrect Answer
      E The Chairperson can never be a member of RMCB Correct Answer Incorrect Answer

      Solution

      The provision allows flexibility but with a critical safeguard—the Chair of the Board can be a member of RMCB only if they possess adequate risk management expertise. This ensures that participation is based on competence rather than position.

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