Interview Questions for Banking

1. RBI Current Policy & Reserve Rates:

Repo Rate – 8%

Reverse Repo – 7%

CRR – 4%

SLR – 22%

MSF – 9%

Bank Rate – 9%

2. What is Bank?

Ans. Bank is financial institution which accepts deposits from the public for the purpose of lending.

3. Types of banks?

Ans. Nationalized banks, Private Banks, Foreign banks, Regional rural banks, Co-operative banks, Industrial banks etc..,

4. What is a nationalized bank?

Ans: Banks which are owned and run by government of India are called as nationalized banks.

=> Example: Canara bank, syndicate bank, Vijaya bank, etc..,

• There are total 21 nationalized banks at present.
• Bhartiya Mahila Bank is a new nationalized bank which starts operation in November.
• Private bank: Banks which are owned and run by individuals are called private banks.

=> Example: karnataka bank, karurvysya bank, lakshmivilas bank etc..,

Foreign banks: Banks which are foreign originated [based] are called foreign banks

=> Example: Citi bank, HSBC bank.

5. What is RBI [Reserve Bank of India], when it is established and what are its functions?

Ans: RBI established in 1935 and Nationalized in 1949 and its head office in Mumbai.

Present Governor of RBI “ Raghuram Rajan”.

Its functions:

1. Issues currency notes
2. Acts as bankers bank
3. Maintains foreign exchange reserves
4. Maintains CRR and SLR

Note: RBI is also called as "bankers bank", because all banks will have a/c's with RBI. It provides funds to all banks hence it is called as BANKERS BANK.

6. What are the Open Market Operations (OMOs)?

Ans: OMOs are the market operations conducted by the Reserve Bank of India by way of sale/ purchase of Government securities to/ from the market with an objective to adjust the rupee liquidity conditions in the market on a durable basis.

For Ex: When the RBI feels there is excess liquidity in the market, it resorts to sale of securities thereby sucking out the rupee liquidity. Similarly, when the liquidity conditions are tight, the RBI will buy securities from the market, thereby releasing liquidity into the market.

7. Types of accounts in banks?

Ans. Savings bank account [SB a/c]: The main purpose of SB a/c is to encourage small savings from the public. Interest paid on SB a/c is 4 percent. Any individual can open SB a/c. An Indian residing at abroad can open a NRI a/c. NRI represents non-resident Indians.

Current account: It’s a running and active account. No interest is paid on current a/c. Current accounts can be opened on firm names. Even individuals

can also open current a/cs. But on firm names you cannot open SB a/c.

Fixed Deposit account: Amount is kept for a fixed period. Higher rate of interest will be paid on this a/c. Recurring deposit [RD a/c]: A fixed amount can be deposited in monthly installments. Interest rate is same as fixed deposits.

8. What is Unclaimed Deposit Account?

Ans: Those saving or current accounts which have not been operated upon for 10 years or more, as at the end of each calendar year.

9. What is Inoperative /Dormant Account?

Ans: A savings as well as current account should be treated as inoperative / dormant if there are no transactions in the account for over a period of two years.

10. What is BSBDA Account (BASIC SAVING BANK DEPOSIT): Under the guidelines issued on August 10, 2012 by RBI: Any individual, including poor or those from weaker section of the society, can open zero balance account in any bank. BSBDA guidelines are applicable to "all scheduled commercial banks in India, including foreign banks having branches in India".

All the accounts opened earlier as 'no-frills' account should be renamed as BSBDA. Banks are required to convert the existing 'no-frills' accounts’ into 'Basic Savings Bank Deposit Accounts'.

The 'Basic Savings Bank Deposit Account' should be considered as a normal banking service available to all customers, through branches .

The aim of introducing 'Basic Savings Bank Deposit Account' is very much part of the efforts of RBI for furthering Financial Inclusion objectives.