Question

If a corporate borrower achieves an Altman Z-Score of 3.20, into which zone does it fall, and what is the recommended lending action for the bank?

A Distress Zone — Restrict lending, demand collateral, and consider exit
B Grey Zone — Apply a risk premium and conduct enhanced monitoring
C Safe Zone — Low default probability; proceed with standard lending and normal pricing
D Default Zone — Initiate SARFAESI proceedings immediately
E Neutral Zone — Reject loan application without evaluation
Practice Next

Hey! Ask a query

🎓
Think You're Ready for RBI Grade B?
RBI Grade B 2026 Phase 1 Memory Based Paper
  • 200 Questions with Detailed Solutions
  • Section-wise Coverage (GA, English, Quant & Reasoning)