Banking & General Financial Awareness
Banking & General Financial Awareness Multiple Choice Questions (MCQs) and Answers with explanation for All Banking Exams of 2024-25 such as IBPS Bank PO, IBPS Bank Clerical, RRB PO and Clerical, SBI PO and SBI Clerical, IBPS Recruitments, RBI Grade B and RBI Banking Examinations.
1. What was the name of State Bank of India (SBI) before it was created by SBI Act?
[A] Imperial Bank of Hindustan
[B] Imperial Bank of Bengal
[C] Imperial Bank of Madras
[D] Imperial Bank of India
Show Answer
Correct Answer: D [ Imperial Bank of India ]
Notes:
The Presidency banks viz. Bank of Bengal, Bank of Bombay and Bank of Madras amalgamated on January 27, 1921 and the Imperial Bank of India was formed under the Imperial Bank of India Act, 1920. After Independence, the Imperial Bank of India was nationalized under the State Bank of India Act, 1955 and State Bank of India (SBI) was formed.
2. Who was the first Governor of Reserve Bank of India?
[A] Sir James Taylor
[B] Sir Vincent Eyre
[C] Sir Osborne Smith
[D] Reginald Macdonald
Show Answer
Correct Answer: C [ Sir Osborne Smith ]
Notes:
Sir Osborne Smith was the first Governor of the Reserve Bank. A professional banker, he served for over 20 years with the Bank of New South Wales and 10 years with the Commonwealth Bank of Australia before coming to India in 1926 as a Managing Governor of the Imperial Bank of India.
3. India’s Foreign Exchange Reserve is maintained by which of the following institutions?
[A] RBI
[B] NABARD
[C] Central Government
[D] IMF
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Correct Answer: A [RBI]
Notes:
Reserve Bank of India Act and the Foreign Exchange Management Act, 1999 set the legal provisions for governing the foreign exchange reserves. Reserve Bank of India accumulates foreign currency reserves by purchasing from authorized dealers in open market operations.
4. SMERA has been registered under which of the following Acts?
[A] Securities and Exchange Board of India Act, 1992
[B] Reserve Bank of India Act, 1934
[C] Banking Regulation Act, 1949
[D] Securities and Exchange Board of India (Credit Rating Agencies) Regulations, 1999
Show Answer
Correct Answer: D [Securities and Exchange Board of India (Credit Rating Agencies) Regulations, 1999]
Notes:
SMERA has been registered under Securities and Exchange Board of India (Credit Rating Agencies) Regulations, 1999.SMERA is registered with the Securities and Exchange Board of India (SEBI) as 6th Credit Rating Agency in India.
5. Who pays for the Credit Ratings in India?
[A] RBI
[B] Government of India
[C] Issuer
[D] SEBI
Show Answer
Correct Answer: C [Issuer]
Notes:
Most credit rating agencies across the world use a revenue model where the issuer pays for the credit rating. In India, the issuer company pays for the credit rating.
6. The idea of providing factoring services was first thought of in India by which of the following?
[A] Tandem Committee
[B] Patel Committee
[C] Malhotra committee
[D] Vaghul committee
Show Answer
Correct Answer: D [Vaghul committee]
Notes:
Invoice factoring for startup companies is a flexible financing solution that is a good way for new businesses to get the cash they need to cover essential operating costs. It was suggested by Vaghul Committee in India.
7. Which of the following banks launched the first mutual fund in India?
[A] State Bank of India
[B] Canara Bank
[C] Indian Bank
[D] Bank of India
Show Answer
Correct Answer: B [Canara Bank]
Notes:
Canara Robeco Mutual Fund is the oldest Mutual Fund in India, established in December 1987 as Canbank Mutual Fund. It is a joint venture between Canara Bank and Robeco of the Netherlands, a global asset management company that manages about US$180 Billion worldwide.
8. Which of the following clearly defines Price Checking?
[A] A prospect calls on the phone and ask for your rental rates.
[B] A supervisor checks your knowledge of rental rates.
[C] Both a and b
[D] None of the Above
Show Answer
Correct Answer: A [A prospect calls on the phone and ask for your rental rates.]
Notes:
A price check is an investigation of the prices charged by different retailers for the same goods to find the best value. All the major supermarkets use price checks to benchmark their pricing against their competitors.
9. Which authority regulates and supervises NBFCs in India?
[A] SEBI
[B] RBI
[C] Ministry of Finance
[D] NABARD
Show Answer
Correct Answer: B [RBI]
Notes:
Reserve Bank of India regulates Non-Banking Financial Companies under Chapter III B and Chapter V of the Reserve Bank of India Act, 1934. The Department of Non-Banking Supervision (DNBS) under RBI was created in 1997 for NBFC regulation. RBI issues guidelines, licensing, and periodic regulation for all NBFCs in India.
10. Which nationalised bank sponsored the Prathama Bank?
[A] Syndicate bank
[B] Punjab National Bank
[C] State Bank of India
[D] Allahabad Bank
Show Answer
Correct Answer: A [Syndicate bank]
Notes:
Syndicate Bank sponsored Prathama Bank, the first regional rural bank in India by name, in Moradabad district, Uttar Pradesh in 1975.
