Latest Commercial Banking question papers, test pattern and Placement papers 02.Mar.2024

Percentage ratio of a financial institution's primary capital to its assets (lo and investments), used as a measure of its financial strength and stability. According to the Capital Adequacy Standard set by Bank for International Settlements (BIS), banks must have a primary capital base equal at least to eight percent of their assets: a bank that lends 12 dollars for every dollar of its capital is within the prescribed limits.

Central banks are normally government owned and assigned with regulatory responsibilities, such as supervising commercial banks or controlling the cash interest rates etc.

Islamic Banks are established in accordance of concepts of Islamic Law. This form of banking revolves around several well established principles based on Islamic canons.

  1. Commercial Banks
  2. Community Banks
  3. Credit Union Banks
  4. Postal Saving Banks
  5. Ethical Banks

Cash Reserve Ratio (CRR) is a specified minimum fraction of the total deposits of customers, which commercial banks have to hold as reserves either in cash or as deposits with the central bank. CRR is set according to the guidelines of the central bank of a country.

Profitability is the relationship between profits and capital (the "static" resources set aside to earn those profits). Measuring profitability me that you have to relate a profit figure (from the Profit and Loss Account) to a resources figure (from the Balance Sheet).

Liquidity may be defined as the ability of a firm to meet its financial obligations as they fall due. The balance sheet (defined as "a structured statement of assets and liabilities")measures these resources and claims.

The first Narasimham Committee was appointed by Manmohan Singh as India's Finance minister on 14th August 199@And the second one was appointed by P.Chidambaram Finance minister in December 1997.

An investment bank (IB) is a financial intermediary that performs a variety of services. Investment banks specialize in large and complex financial tractions such as underwriting, acting as an intermediary between a securities issuer and the investing public, facilitating mergers and other corporate reorganizations, and acting as a broker and/or financial adviser for institutional clients.

Sources of Funds:

  • Share Capital
  • Reserves and Surplus
  • Deposits
  • Borrowings

Application of Funds:

  • Cash and cash Balance with RBI
  • Cash balance with other banks
  • Investments
  • Advances Source

(1) Primary Function:

  • Accepting Deposits
  • Advancing of Lo
  • Credit Creation

(2) Secondary Function:

  • Agency Functions
  • Public Utility Functions

  1. Mobilizing Saving for Capital Formation
  2. Financing Industry
  3. Financing Trade
  4. Financing Agriculture
  5. Financing Consumer Activities
  6. Financing Employment Generating Activities
  7. Help in Monetary Policy

A loan or lease that is not meeting its stated principal and interest payments. Banks usually classify as nonperforming assets any commercial lo which are more than 90 days overdue and any consumer lo which are more than 180 days overdue. More generally, an asset which is not producing income.

  1. To study all aspects relating to the structure and procedures of the financial systems.
  2. To recommend improvements in their efficiency and productivity.
  3. To reform the Indian Banking sector.

Combined Banks are also called as Universal banks. These are commonly known as financial services companies; engage in several of diversified financial services.

  1. Liquidity
  2. Profitability
  3. Safety
  4. Diversity
  5. Stability of securities

  • Commercial Banks are the organizations which cater certain financial tractions.
  • Its aim is to earn profit.
  • Tractions are socially and legally approved.
  • Responsible for customer deposits in the bank.
  • Established and operated under the control of central bank of a nation.

An establishment authorized by a government to accept deposits, pay interest, clear checks, make lo, act as an intermediary in financial tractions, and provide other financial services to its customers.

A commercial bank is a financial institution that provides services, such as accepting deposits, giving business lo and auto lo, mortgage lending, and basic investment products like savings accounts and certificates of deposit.

List of Commercial Banks in India:

  1. Reserve Bank of India 
  2. Abu Dhabi Commercial Bank 
  3. Allahabad Bank. 
  4. Andhra Bank 
  5. Bank of India 
  6. Bank of Madura 
  7. Bank of Punjab 
  8. Canara Bank 
  9. Chinatrust Commercial Bank 
  10. Citibank 
  11. City Union Bank 
  12. Corporation Bank