Practice Financial Management Questions and Answers

• Liquidity is the ability to accommodate ______ in liability and _____ in assets.
• What are the mismatch tolerance levels for time bucket of 15 – 28 days  in the ALM statement?
• XYZ Bank Ltd specializes in granting loans to firms in a specific line of business. Which of the following is true in this case?
• RBI increased the CRR requirement to 4.5% in May 2022. This action is expected to ________
• Risk faced by financial institutions in which advancement of technology does not produce savings in cost is known as _____
• What doe ‘I’ in SWIFT stand for?
• The bonds prices _____ with increase in interest rates.
• For market risk, the minimum capital requirement is expressed in terms of two separately calculated charges. Which of the following are those two risks cha...
• The LTV allowed on loans against gold jewellery or gold loans is _____
• A 16% bond with a face value of Rs. 250 is available for Rs. 200 in the market. The current yield on the bond is
• In Capital Asset pricing model, beta measures the
• A bank borrows Rs.50 crore from call money market on a daily basis. It invests in 5-year Government of India bonds with YTM of 7.10% having market value of...
• _________ is the risk of loss that arises due to breakdown in the internal procedures, people and systems or from external events
• Adequacy of a bankrsquo;s liquidity position depends upon ________
• Which of the following risks are considered as non financial risks faced by a bank
• Which of the following statements correctly represents capital?
• In ‘CAMELS’  what does C stand for?
• Pillar I of Basel III covers 3 types of risks. Which of the following is not one among them?
• The Asset-Liability Management committee (ALCO) deal with different types of ______
• Which of the following is a type of interest rate risk?
• Which of the following is correct regarding Risk Adjusted Returns on investment?       I.         It is the process where a Risk in a business...
• The bank bought a 5 year G-Sec with YTM of 7.6% and plans to sell them in 2 weeks. The bond could not be sold within 2 weeks due to over sight and as a res...
• Which of the following instruments do not contain Zero Risk?
• Which of the following is correct regarding Strategic Risk?               i.        A Risk arising from adverse business decisions   ...
• What is the alpha factor set by Basel Committee relating to the industry wide level of required capital for operational risk, under the Basic Indicator App...
• Which of the following is NOT an objective of Basel III guidelines?  A.    Improve risk management and governance in banks B.    Improve the ability...
• Which of the following type of Preference share will not be treated as Tier II capital?
• Which of the following best describes the position of an investor who is under an obligation to buy the underlying asset in a futures position?
• Which of the following measures reflects the ratio of change in the price of call option to the change in the price of the underlying stock?
• When the spot price of a Call Option is less than the strike Price of an Option, the Option is said to be _______
• In terms of banking capital reserve, Tier II's capital loss absorption capacity is____ that of Tier I capital.  
• HDFC Bank is a systemically important Bank. As such, it has to maintain additional Common Equity Tier 1 of ________ as a percentage of its Risk-Weighted As...
• If ABC Bank is encouraging its home loan borrowers to shift to a floating rate option, the bank is likely to be _______
• Which of the following investment of banks are not marked-to-market?
• The Asset Liability Management (ALM) Statement is to be prepared by every bank and is a regulatory requirement. It shows the maturity time-wise break-up of...
• Mr. Sumant imported mobile handset parts for his mobile assembling unit in Tamil Nadu from an exporter in China. He has to pay USD 1,00,000 to the exporter...
• YTM of a Bond is not affected by
• Which of the following is true about Duration of a bond?
• The Board of the Bank had set the tolerance levels for the interest rate risk. The bank assesses and monitors the risk against the guidelines. Who should t...
• In the case of a forward contract , the actual risk arises and is managed on: