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101 Questions & Answers-Interview for Bank Promotions-VRK100-08Nov2010

101 Questions & Answers-Interview for Bank Promotions-VRK100-08Nov2010

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Rama Krishna Vadlamudi, Hyderabad has compiled answers to 101 Interview Questions for Bank Promotions. This is useful for banking professionals who are appearing for promotional examinations and interviews.
Rama Krishna Vadlamudi, Hyderabad has compiled answers to 101 Interview Questions for Bank Promotions. This is useful for banking professionals who are appearing for promotional examinations and interviews.

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Published by: RamaKrishna Vadlamudi on Nov 08, 2010
Copyright:Attribution Non-commercial No-derivs


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Dear Friend,I had on October 27, 2010 sent you a PDF file listing out 101 interview questionsfor bank promotions. I am sure by this time, you must have answered most of thequestions. I too have tried to answer those questions. I am attaching a new file with answers to those 101 questions.  With regards,Rama Krishna V HyderabadNovember 8, 2010
 Note: The answers are not in the order in which questions were set on October 27, 2010 in the file named “101 interview questions for bank promotions.”  Please read the disclaimer at the end of the answers.
Compiled by: Rama Krishna Vadlamudi, Hyderabad November 8, 2010
PAGE 2 OF 26 
 Answers to 101 interview questions for bank promotions:
81. What is ‘paripassu’ charge? A 
‘paripassu’ charge
gives lenders a right to the property on which a charge iscreated in proportion to the amount lent to the debtor. Let us assume two banks‘X’ and ‘Y’ have lent to a company with the outstanding at Rs 70 lakh and Rs 30lakh respectively and have ‘paripassu’ charge over the assets hypothecated. Incase of liquidation of that company, the lenders ‘X’ and ‘Y’ will share the proceedsfrom liquidation in proportion to the outstanding loan amount, that is, 70:30.71. What are SEZs?SEZ is an acronym for a
Special Economic Zone
. SEZs are a big success inChina. Based on the Chinese model, India too has set up several SEZs with a view to increasing economic activity, attracting foreign and domestic investment,creating employment opportunities and developing infrastructure in the country. As of now, there are 122 operational SEZs in India, out of a total 155 whichreceived ‘in-principle’ approval from the Government. The advantage with SEZsis that they can be set up with single-window clearance and simple rules.Some of the well-known SEZs are SEEPZ SEZ, Kandla SEZ, Madras SEZ and Visakhapatnam SEZ in the Government Sector; Mahindra City SEZ, Chennai,Surat SEZ, Mundra Port & SEZ and Infosys Technologies SEZ, Managaore in theprivate sector.61. Do commercial banks have freedom to raise/lower interest rate on SavingsBank account?Commercial banks in India do not have freedom to set
interest rate onSavings Bank deposits
. Reserve Bank of India decides rates on SB account.However, RBI is preparing a discussion paper to assess the pros and cons of deregulating interest rates on Savings Banks account. If RBI decides toderegulate and give freedom to banks to set rates on SB deposits ultimately, thensavers can expect better interest rate on their SB accounts. As of now, Savings Bank accounts carry interest rate of 3.5 per cent per annum with effect from March 1, 2003. From April 1, 2010, banks are giving interestrates on SB account based on daily product.
Compiled by: Rama Krishna Vadlamudi, Hyderabad November 8, 2010
PAGE 3 OF 26 
41. What is a no-frill account? As per the guidelines given by Reserve Bank of India and in line with theintentions of the Government of India, commercial banks have been opening no-frills accounts to large sections of underprivileged sections of the society. The
no-frills accounts
are an innovative concept to introduce banking to the masses.This concept is part of ‘financial inclusion’ drive started by the Government of India some time back.
Customers can open no-frills accounts with either a ‘zero’ balance or with bare minimum balance.
Even collateral-free loans of up to Rs 50,000 can be obtained by the no-frills accountholder.
Students from minority communities can open such accounts to receiveGovernment Scholarships
Banks can provide credit cards against no-frills accounts in rural andsemi-urban areas101. Why are gold prices rising?This is a most difficult question to answer. However, let me try. Gold is a preciouscommodity. From time immemorial, gold has fascinated man (man includes woman also). It is a malleable material and can be converted easily into any form.It has no economic value meaning it does not offer any regular return (like adividend from a stock or interest from a bond) except capital gains. Internationalgold price is hovering around USD 1,390 per ounce and in India around Rs19,700 per 10 gm. The reasons for
gold price rise
can be attributed to:
Investors around the world are worried about the growth of the worldeconomy 
They consider gold as better compared to the depreciating currencies,like, US dollar
Due to the global financial crisis of 2007/2008, investors have lost faith inGovernments who have been printing currency notes in thousands of crores devaluing their currencies
 As a result, purchasing power of currencies has come down
The sovereign debt crisis in Dubai and Greece have convinced investorsthat Governments are broke; so gold is a safe haven
Even central banks of several countries, including, India and China, have bought tonnes of gold from the IMF and international market
Rising prices bring in more investors to gold
Gold exchange-traded funds (ETFs) have made it easier for investors toput their money in gold
The price of any good or service depends on the principle of demand andsupply. However, sentiments matter a lot in markets rather thanfundamentals.

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