Banking
&
Financial
Awareness
1
India Infrastructure Finance Company
Ltd (IIFCL), a state-owned infrastructure
lender. His term will be for 5 years)
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2 CURRENT AFFAIRS
1) National Stock Exchange (NSE)
during December 2013 completed how
many years of its establishment? – 20
years (NSE was founded in 1992 and
started trading operations in 1993. It
was the first in India to start electronic
trading and was successful in bringing
about a paradigm shift in the way
trading and settlements were done.
NSE has a market capitalisation of more
than US$989
billion
and
1,635
companies listed as on July 2013 and is
the largest stock exchange in India)
2) Who was appointed as the new
Chairman of the National Bank for
Agriculture and Rural Development
(NABARD) during December 2013? –
Harsh Kumar Bhanwala (Bhanwala
succeeds Prakash Bakshi, who retired
as NABARD Chairman in September
2013.
Before
this
appointment
Bhanwala was an Executive Director at
3) Who was appointed as the new
Finance Secretary of India on 10
December, 2013? – Sumit Bose (Bose
takes place of R.S. Gujral, who retired
during November 2013. Gujral was also
looking
after
the
expenditure
department. Sumit Bose is an IAS
officer of Madhya Pradesh cadre (1976
batch) and was the senior-most
secretary in the Finance Ministry that
has two other secretaries- Arvind
Mayaram (economic affairs) and Ratan
P Watal (expenditure). He is due to
retire in March 2014)
4) Top 30 loan defaulters of public
sector banks (PSBs) account for more
than one-third of total gross nonperforming assets (NPAs) of state-run
lenders. This information was given in
the Parliament on 10 December, 2013.
According to this information what is the
ratio of top 30 NPAs as a percentage of
gross NPAs, in respect of public sector
banks, as on September 2013? –
35.5% (This figure stands at 38.8% for
all banks in India. The gross nonperforming assets (GNPA) amount of
top 30 accounts of public sector banks
(PSBs) stood at Rs. 72,174 crore, while
for all banks it was Rs. 91,667 crore at
the end of September 2013. In case of
nationalised banks, the top 30
defaulters contributed 43.8 per cent to
the GNPA with Rs. 55,663 crore. The
GNPAs of the SBI Group, comprising
SBI and its five associates, were worth
Rs. 71,620 crore at the end of first
quarter of the current fiscal)
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3 CURRENT AFFAIRS
5) Which private sector bank during
December 2013 joined hands with the
National Payments Corporation of India
(NPCIL) to introduce eKYC (electronic
Know Your Customer) norms in its
branches? – HDFC Bank (The eKYC
procedure will enable a consumer to
walk in with an Aadhaar number and
open an account by getting his
fingerprint scanned. HDFC Bank will
install biometric readers for scanning
fingerprints at most of its branches in a
few months. The banks systems will pull
all data stored online with the Unique
Identification Authority of India (UIAI)
including name, address, birth date and
photograph)
6) The United Forum of Bank Unions
(UFBU), in its memorandum given
during December 2013 to the Finance
Minister, has kept which demand
prominently which has huge support of
bank employees all over the country? –
Working
for
five-days
in
a
week (Trade unions in the banking
sector have raised this demand as part
of their bipartite wage negotiations with
the Indian Banks’ Association. With
alternative channels such as ATMs,
Internet and mobile banking in place,
the unions feel that the time is ripe for
moving to a five-day week. Unions
argue that not only Central and State
Government ministries/departments but
even the Reserve Bank of India follows
the five-day work schedule. However,
another section of bankers were of the
opinion that five-day week was not
advisable as it would come in the way of
efforts towards financial inclusion)
7) Which
natural
gas
pipeline
inaugurated by the Prime Minister on 3
December, 2013 is the first one to
connect Southern India to the national
grid? – Dabhol – Bangaluru Gas
Pipeline of GAIL (The Dabhol –
Bangaluru gas pipeline is 1,000 km long
and has been put-up with an investment
of around Rs. 4,500 crore. The pipeline
starts at Dabhol in Maharashtra and
passes through Belgaum, Dharwad,
Gadag,
Bellary,
Devanagere,
Chitradurga, Tumkur, Ramanagaram,
Bengaluru Rural and Bengaluru Urban
districts)
8) More than a year after allowing FDI
in multi-brand retail, the government on
17 December 2013 received the first
application to open stores under this
category. Which company gave this
application to set-up multi-brand retail
stores in India with an Indian group? –
Tesco Plc. (Tesco Plc. is a UK-based
retailer and it has sought approval to
open retail stores in India with an
investment of $110 million in joint
venture with Tata Group. The jointventure Trent Hypermarket, will trade in
products under 14 categories and plans
to open three to five stores every
financial year. The government in
September 2012 had allowed 51% FDI
in multi-brand retail with certain riders)
9) Which public sector bank is the only
Indian bank to have a branch in
Bangkok (Thailand) and it during
December 2013 received the Reserve
Bank of India (RBI’s) approval for
opening a second branch here? –
Indian Overseas Bank (IOB) – IOB
will open the second branch before the
end of March 2014. IOB had few years
back roped in Deloitte to devise a
strategy for the bank’s overseas
expansion)
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4 CURRENT AFFAIRS
10) State-run Indian Oil Corp has
emerged as the country’s biggest
company in terms of annual revenue,
followed by Mukesh Ambani-led private
sector giant Reliance Industries at the
second place, as per an annual list of
Fortune 500 companies in India in
Fortune magazine’s Indian edition
released during December 2013.
Among the top ten companies in this
list, the highest number of companies is
from
which
sector?
– Energy
Sector (There are as many as seven
energy companies in the top 10 list.
Indian Oil Corp (IOC) was the biggest
with annual revenue of Rs 4,75,867
crore, followed by Reliance Industries
(RIL) with a full-year revenue of Rs
4,09,883 crore. This is followed by
Bharat Petroleum (Rs 2,44,822 crore) at
the third place and Hindustan Petroleum
(Rs 2,17,771 crore) at fourth. Other
entities in the list are State Bank of India
(5th rank), Tata Motors (6th), ONGC (7th),
Tata Steel (8th), Essar Oil (9th) and Coal
India (10th))
Banking & Financial Awareness
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5 Banking & Finance
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1) The committee constituted by the
Reserve Bank of India (RBI’s) to
promote financial inclusion headed by
Nachiket Mor in its report, presented to
the RBI on 7 January 2014,
recommended universal electronic
bank accounts to all Indian citizens
above the age of 18 years. What is the
deadline for opening these bank
accounts as recommended by the
committee? – 1 January 2016 (The
committee has recommended that an
instruction to open the bank account
should be initiated by the Unique
Identification Authority of India (UIAI)
after the issue of an Aadhaar number
to an individual over the age of 18. It
also recommended that the RBI
should issue a circular indicating that
no bank can refuse to open an
account for a customer who has
adequate KYC proof which specifically
includes Aadhaar)
2) Which
country
became
the
18th member of Eurozone on 1 January
2014? –Latvia (The former Soviet
republic on the Baltic Sea recently
emerged from the financial crisis to
become the EU’s fastest-growing
economy. Latvia was given final
clearance to join Eurozone on 9 July
2013 by finance ministers of the 28nation European Union. It should be
noted that 28-member EU is a political
entity and represents the interest of all
of Europe whereas Eurozone is a
currency block of 18 nations that have
accepted Euro as a common currency.
Not all countries of EU use Euro as
currency (Britain still uses Pound as its
currency))
3) The Reserve Bank of India (RBI) on
31 December 2013 dismissed rumours
that it has stopped banks from
accepting scribbled currency notes
from 1 January 2014 and announced
that banks will continue to accept
currency
notes
with
scribbling.
However, it reiterated that writing or
scribbling on banknotes works against
its policy to keep currency notes clean
and sought co-operation from public,
institutions and others in keeping the
banknotes clean by not writing
anything on them. What is the name of
this policy which was released during
2013? – ‘Clean Note Policy’ (RBI in
2013 had said it has been noticed that
at certain branches of banks, the
practice of writing/scribbling on the
body of the bank notes continues to
remain in vogue. Under the present
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6 Banking & Finance
system of mechanised processing of
banknotes inscription or scribbling on
any part of the banknote would render
it to be classified as unfit for reissue)
4) The Reserve Bank of India (RBI) on
23 December 2013 warned users,
holders and traders of virtual
currencies, including bitcoins, of
financial, operational, legal, customer
protection and security related risks.
Why was this warning given by the
RBI for bitcoins type currency, which is
digital or virtual currency that uses
peer-to-peer technology to facilitate
instant
payments?
– Because
bitcoins as a medium for payments
are presently not authorised by any
central bank or monetary authority
in India (Bitcoin is an alternative
currency, which uses cryptography for
security, making it difficult to
counterfeit. Bitcoin issuance and
transactions are carried out collectively
by the network, with no central
authority. The central bank said it was
keeping watch at the developments
relating to certain electronic records
claimed to be decentralised digital
currency such as bitcoins, litecoins,
bbqcoins, dogecoins and their usage
or trading in the country)
5) Union
government
during
December 2013 announced decision
to covert the National Institute for
Micro, Small and Medium Enterprises
(NIMSME) into the National SME
(Small and Medium Enterprises)
University. NIMSME is situated at –
Hyderabad (This
decision
was
announced at the golden jubilee
celebrations of NIMSME held on 21
December 2013 at Hyderabad)
6) Who on 20 December 2013 was
appointed as the first woman
managing director of the Life
Insurance Corporation of India (LIC)
by
the
Government?
– Usha
Sangwan (She became the first
woman MD in corporation’s history
since its establishment in 1956. With
this appointment, LIC is set to function
at its full strength of four MDs after
almost two years. These would be S B
Mainak, Sushobhan Sarkar, Sangwan
and V K Sharma)
7) Indian financial markets were left
surprised by Reserve Bank of India
(RBI’s) mid-quarter monetary policy
review released on 18 December 2013
as all key policy rates were left
unchanged in this review presented by
RBI Governor Raghuram Rajan. The
short-term lending rate was kept
unchanged at 7.75%, while the cash
reserve ratio (CRR) remained at 4%.
Why markets were left surprised with
this move? – Because markets had
expected another 25 bps hike in the
short-term lending rate due to
persistent high inflationary pressure
(The RBI said it will take calibrated
action in the future, based on
inflationary trends and action by the
US Federal Reserve)
Key highlights of RBI’s mid-quarter
review of monetary policy



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7 Banking & Finance

- Key policy rate, cash reserve ratio
unchanged
- Repo rate unchanged at 7.75%;
cash reserve ratio unchanged at 4%
- RBI to wait for more data before
taking policy action
- Outlook on global growth
continues to remain moderate
8) According to the statistics given by
the
Insurance
Regulatory
and
Development Authority (IRDA) during
December 2013, the average number
of policies sold by an agent of LIC was
almost 10 times that of his private
sector counterpart. LIC’s agents
managed their outperformance last
year too, when the life insurance
business was on a slide. What was the
average policy sale figure for an LIC
agent as disclosed by the IRDA? – 29
Policies (LIC has an agency force of
11.72 lakh while private companies
have 9.49 lakh agents working for
them)
9) The
much-anticipated
inflation
indexed bonds, linked to consumer
prices were made available for sale for
a week beginning 23 December 2013.
What was the name of these bonds
which sought to protect consumer
savings from price rise by offering
returns over and above inflation at the
retail level? – Inflation Indexed
National Savings Securities –
Cumulative
10) The Ministry of Environment and
Forests announced on 20 December
2013 that the ecologically-sensitive
Western Ghats will remain off-bounds
for mining, quarrying, sand mining and
other industrial activities. This move
comes after a high-level working group
recommended that all destructive
industrial activities, that include mining
and thermal power plants, should be
banned in the region. Who headed this
group? – K. Kasturirangan, Member
(Science), Planning Commission (The
group recognised about 37% of the
Western Ghats, covering about 60,000
square km, to be ecologically
sensitive)
Banking & Financial Awareness
3
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8 Banking & Finance
1) According to announcement made
by Union Finance Minister P.
Chidambaram on 12 January 2014 the
Centre has revised its target upwards
to opening 10,000 new bank branches
a year. This has been part of Centre’s
initiative of taking banking services to
rural areas. What was the earlier
target? – 7,000 branches (From the
coming financial year, it has been
revised to open 10,000 branches a
year and through this, an additional
55,000 new jobs are expected to be
created)
2) Which major bank during January
2014 came out with plans to outsource
the management of some of its ATMs
by taking calls from vendors? – State
Bank of India (SBI called for a
Request for Proposal (RFP) from
vendors to manage about 7,843 cash
dispensers (ATMs). Vendors will be
expected to have all capabilities to
remotely
capture
and
initiate
appropriate action in the event of any
problems
at
these
cash
dispensers. They will be expected to
ensure that the downtime of these
ATMs in metro and urban areas is less
than 3%, while it is less than 6% in
rural areas. SBI had 32,777 ATMs as
of 30 September 2013. It has
expanded its network steadily in the
past few years, adding about a third of
its network (about 11,000 ATMs) in the
past 18 months. ATM operations have
however not been profitable)
3) Retirement
fund-body
the
Employees’
Provident
Fund
Organisation (EPFO) on 13 January
2014 decided to increase the rate of
interest on Provident Fund deposits to
8.75 per cent for 2013-14, a move that
will benefit about 5 crore subscribers.
What was the present rate of interest
for EPFO subscribers? – 8.5%(The
Central Board of Trustees, which is the
apex decision-making body of the
Employees’
Provident
Fund
Organisation (EPFO), met on 13
January and approved the interest
rate. The EPFO’s recommendation will
now be vetted by the Finance Ministry.
Once the ministry approves the
decision, the interest would be
credited
to
the
accounts
of
subscribers. The EPFO is estimated to
have an income of Rs 20,796.96 crore
in the current financial year)
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9 Banking & Finance
4) The Reserve Bank of India (RBI)
during January 2014 clarified that the
provision of prior RBI nod applies for
establishments from Hong Kong and
Macau to set up business or related
activities in India. As per the existing
conditions this provision pertaining to
RBI’s approval applies on which 6
countries?
– Afghanistan,
Bangladesh, China, Iran, Pakistan
and Sri Lanka (As per the existing
conditions
under
the
Foreign
Exchange Management Regulations,
no entity or citizens of these 6
countries is allowed to set up any
branch office or a liaison office or a
project or any other such business
activity without prior permission of the
RBI)
5) The government Union on 10
January 2014 gave its approval to the
plan to form an Exchange Traded
Fund (ETF) comprising scrips of 11
bluechip
state-owned
companies,
which will be offered in the market with
a view to garnering Rs 3,000 crore this
fiscal. Which are the 11 state-owned
companies (PSUs) involved in this
ETF plan? – ONGC, Coal India
Limited, GAIL, Power Grid, REC, Oil
India
Limited,
Container
Corporation of India, Power Finance
Corporation, Indian Oil Limited,
Engineers India Limited and Bharat
Engineering Limited (ETF is a
security that tracks an index, a
commodity or a basket of assets like
an index fund, but trades like a stock
on an exchange. The PSU ETF would
comprise shares of various profitable
state-owned
companies.
The
composition of ETF and weightage of
the shares of individual PSU in the
index has been decided by the EGoM)
6) SEBI on 10 January 2014 notified
new norms empowering its Chairman
to order search and seizure operations
during investigations, while necessary
safeguards have also been put in
place to protect rights of affected
persons. This would add extra power
to
SEBI’s
crackdown
against
fraudsters. What is the name of the
ordinance promulgated by the Union
government in September 2013, which
had conferred explicit powers on SEBI
Chairman to authorise investigating
authority or any other officer of SEBI to
conduct search and seizure under the
SEBI
Act?
–Securities
Laws
(Amendment) Second Ordinance,
2013 (The new norms providing SEBI
with powers to conduct search and
seizure have been finalised after
taking into account suggestions from
public and other stakeholders to draft
regulations, which were issued in
November 2013)
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10 Banking & Finance
7) Which bank during January 2014
became the first Indian domestic
private sector bank to have a branch
presence in China? – Axis Bank (Axis
Bank recently opened its branch in
Shanghai after receiving permission
from the China Banking Regulatory
Commission (CBRC). The branch will
engage in foreign currency businesses
that includes all business approved by
the banking supervision and regulatory
authorities of the China. With opening
of Shanghai branch, Axis Bank’s
overseas presence has grown to eight
– one each in Singapore, Hong Kong,
Dubai, Colombo, and Shanghai, two
representative offices at Dubai and
Abu Dhabi and an overseas subsidiary
in London)
8) Which private asset management
company
(AMC)
January
2014
became the first private sector fund
house to launch an inflation indexed
fund that aims to provide inflationadjusted returns to investors? –
Deutsche Asset Management India
– DAMI (DAMI’s scheme, ‘DWS
Inflation—Indexed Bond Fund’ is an
open—ended debt fund and will open
for subscription on 16 January 2014,
and close on 27 January. Inflation
indexed bonds (IIBs) are instruments
where interest payment and principal
are linked to whole sale price index
(WPI) inflation and these bonds are
currently available at an attractive yield
of 3.6% above WPI. Government has
been issuing IIBs on a monthly basis
since June, 2013 and the current
outstanding issuance stands at Rs
6,500 crore as of now)
9) SEBI (Securities and Exchange
Board of India) Chairman UK Sinha’s
term was extended by 2 years during
January 2014. Sinha will now head the
regulatory body till 16 March 2016.
Among the last four chairmen, Sinha is
the only one whose term has been
extended. Who is the only SEBI chief
to have held the post for a longer
duration
than
Sinha?
– D.R.
Mehta (Mehta
served
as
SEBI
Chairman for 7 years (1995-2002).
Sinha’s three predecessors – GN
Bajpai (2002-2005), M Damodaran
(2005-2008) and CB Bhave (20082011) – had only got a three-year
terms)
10) The
three
day
12th Pravasi
Bharatiya Divas (PBD) was held
between 7-9 January 2014 at Vigyan
Bhawan, New Delhi. What was the
theme of this year’s PBD? – Engaging
Diaspora:
Connecting
Across
Generations (PBD is celebrated on
9th January every year to mark the
contribution of Overseas Indian
community in the development of
India. January 9 was chosen as the
day to celebrate this occasion since it
was on this day in 1915 that Mahatma
Gandhi, the greatest Pravasi (nonresident citizen), returned to India from
South Africa, led India’s freedom
struggle and changed the lives of
Indians forever)
Banking & Financial Awareness 4
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11 Banking & Finance
the bank will completely waive off the
requirement for collateral)
1) To
promote
women
entrepreneurship, the country’s first
women’s bank – the Bharatiya Mahila
Bank (BMB) – has chosen to do away
with collateral for loans availed by
women. The BMB will provide
collateral-free loans for amounts up to
Rs 1 crore. Which entity would cover
the risk under this initiative? – Credit
Guarantee Fund Trust for Micro and
Small Enterprises – CGTMSE (The
CGTMSE is a credit guarantee
scheme, where a premium is paid
either by the lender or the applicant,
provides a guarantee cover for up to
80% of loans availed by women
owned or operated micro- and small
enterprises. For loans availed for
smaller amounts such as Rs 20,000,
2) In a major overhaul of foreign
investment regime, the government is
considering splitting overseas inflows
into two categories – Foreign Portfolio
Investment (FPI) and Foreign Direct
Investment (FDI) – with a minimum
composite cap of 49%. The proposal
envisages an aggregate automatic
limit of 24% of FPI, which may be
raised up to the extent of FDI
permitted under the automatic route.
Constituting two categories for foreign
investments is considered by which
panel?
– Mayaram
Panel (The
government had set up a four-member
committee headed by Economic
Affairs Secretary Mayaram to define
FDI and FII and remove the ambiguity
between them. The Committee
submitted its final report during the last
week of January 2014)
12 Banking & Finance
Page
3) Who was the head of RBI’s
committee on strengthening monetary
policy framework, which in its
recommendations has suggested that
the target for inflation should be set at
4% with a band of +/- 2% around it? –
Urjit Patel, Deputy Governor of the
RBI (This inflation target is in view of
vulnerability of the Indian economy to
supply/external shocks and the
relatively large weight of food in
Consumer Price Index (CPI))
banking
industry?
–Tamilnad
Mercantile Bank – TMB (Tuticorinbased TMB took a decision to this
effect at a meeting held on 18 January
2014. This dividend stands at Rs. 900
per share of Rs 10 each, for the fiscal
ending March 2014. This is the second
year in a row that the bank has
declared such a high dividend. The
bank’s board had approved a dividend
of Rs 750 per share for 2008-09 and
Rs 1,000 per share the following year)
4) The Reserve Bank of India during
January 2014 constituted an 8member expert committee to review
the governance of bank boards in
India, which includes examining the
ownership and salary structure of
banks. Who heads this committee? –
PJ Naik, former Chairman and CEO
of Axis Bank (The committee will
review the regulatory compliance
requirements of the board of directors
of banks, judge what can be
rationalised and where requirements
need enhancements, examine the
working of the boards, including
whether adequate time is being
devoted to issues of strategy, growth,
governance and risk management)
6) Who retired as Deputy Governor of
the Reserve Bank of India (RBI) on 20
January 2014? – Anand Sinha (With
Anand Sinha relinquishing his charge
as Deputy Governor, the RBI reallocated his portfolios among the
remaining three Deputy Governors —
K.C. Chakrabarty, H.R. Khan and Urjit
Patel. Sinha was in-charge of eight
departments, including Departments of
Banking Operations and Development,
Risk
Management,
Information
Technology and Expenditure and
Budgetary Control)
5) Which bank came to highlight
during January 2014 for declaring an
interim dividend of 9000%, which is
said to be the highest in India’s
7) The Union Government on 20
January
2014
allowed
the
establishment of an ad hoc authority to
recommend the pricing of the
passenger and cargo segments. What
is the name of this authority? – Rail
Tariff Authority (Rail Tariff Authority
will have a Chairman and four
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13 Banking & Finance
members. The decision to have an ad
hoc
arrangement
through
a
government resolution was taken
because establishing it through an
executive order, as had been desired
by the Cabinet, was not feasible given
that under the Railway Act only the
Railway Board can decide on the
prices of rail services. For constitution
of the RTA, an amendment to the
Railway Act, 1989, is also necessary)
8) A prominent Indian credit rating
agency along with four other rating
agencies from Europe, Asia, Africa
and Latin America during January
2014 launched a new credit rating
outfit ARC Ratings S.A. The networkbased rating agency would provide
credit rating services to cross-border
corporates in terms of accessing
global capital. Which Indian rating is
involved in this initiative? – CARE –
Credit Analysis and Research (ARC
Ratings will be an equally held entity
and have its operational headquarters
in
London.
Each
partner’s
shareholding is capped at a maximum
of 25%. ARC will rate sovereign debt,
financial institutions, non-financial
corporations as well as structured
products)
9) China’s economy grew by 7.7% in
2013, which is far below the standards
of China – world’s second-largest
economy. The economic growth rate
of 2013 is the lowest since which
year? – 1999 (2013’s growth is the
lowest in 14 years. This marks the
slowest growth since 1999, when
China grew 7.6%. The previous
decade saw record double-digit
growth, with the country defying the
global slowdown to grow 10.4% in
2010 as it unveiled a massive $ 586
billion stimulus. This declining growth
underlines the challenges faced by
China as it grapples with rebalancing
and reviving a slowing down economy)
10) Which stock exchange retained its
position as the world’s largest bourse
in terms of equity trades for the
second consecutive year in 2013? –
India’s National Stock Exchange
(NSE) – NSE recorded almost 145
crore equity trades on its platform last
year, a gain of 3% from 2012, making
it the biggest among 51 global peers,
according to data with the World
Federation of Exchanges (WFE). Rival
exchange BSE slipped one place to
eighth position. Although it has more
than 4,000 listed companies, the BSE
recorded 34.46 crore trades last year,
a drop of 3% compared to 2012.
China’s Shenzhen Stock Exchange
recorded 129 crore trades, climbing
three places to become the secondlargest bourse in the world. Trades on
the Shenzhen SE, which pushed
NYSE Euronext to third place, rose
38% from 2012
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14 Banking & Finance
Banking & Financial Awareness 5
1) India
Post
(Indian
postal
department) during January 2014
announced an ambitious plan to install
as many as 3,000 ATMs and 1.35 lakh
micro-ATMs at its post offices across
the country for savings account
holders. This plan was rolled-out by
installing three ATMs in New Delhi,
Chennai and Bangalore on 5 February
2014 and ramping it up gradually.
What is the tentative deadline given by
India Post for installing these 3,000
ATMs and 1.35 lakh micro-ATMs? –
September 2015(Under this plan,
1,000 ATMs with the India Post
branding will be put in within the first
year, which will be ramped up
massively to 3,000 in the next 18
months. To start with, the ATMs can
be used only by 26 crore savings
account-holders who save with the
postal department but India Post
hopes that within six months of the
launch, it will get the interoperability
permission from the Reserve Bank of
India (RBI). Postal savings are worth
around Rs 6.05 trillion, which is half
the savings in the largest lender SBI
and more than double that of the
largest private sector lender ICICI
Bank)
2) What is the new Repo Rate after
Reserve Bank of India (RBI) Governor
Raghuram Rajan on 28 January 2014
increased it by 0.25% under RBI’s
third quarter monetary policy review? –
8% (This move is expected to
translate into higher EMIs and push up
the cost of borrowing for corporates.
Consequently, the Reverse Repo Rate
under the Liquidity Adjustment Facility
(LAF) will be revised to 7% and the
marginal standing facility rate and
bank rate to 9%. However, the RBI
kept the cash reserve ratio (CRR)
unchanged at 4% as liquidity seems to
be comfortable)
Page
15 Banking & Finance
3) The
RBI
released
the
Macroeconomic
and
Monetary
Developments Report along with the
third quarter monetary policy review on
28 January 2014. What is RBI’s broad
expectation about economic growth
rate (GDP Growth Rate) during 201313? – GDP growth rate will remain
below 5% (The RBI said the growth is
expected to fall below 5% in 2013-14
in absence of pick-up in manufacturing
sector, but likely to recover to 5.5% in
the next financial year (2014-15). In
the first half of 2013-14, the GDP
growth was at 4.6%)
4) What is the name of a new fund
announced on 27 January 2014 by the
National Innovation Council (NInC)
and the Ministry of Micro, Small and
Medium Enterprises to combine
innovation and the dynamism of
enterprise to solve the problems of
citizens at the bottom of the economic
pyramid in India? – India Inclusive
Innovation Fund – IIIF (The fund,
launched by Sam Pitroda, head of the
NInC, is an autonomous Rs. 500-crore
fund, with the Union Government
contributing 20%. The balance will
come from public sector banks,
financial
institutions,
insurance
companies,
multilateral/bilateral
development agencies, Indian & global
corporates)
5) What was the GDP growth rate
figure for Indian economy for 2012-13
declared by the Union Government on
31 January 2014? – 4.5% (This GDP
growth rate is 0.5% lower as
compared with the earlier estimate of
5%
on
account
of
subdued
performance in agriculture, mining and
manufacturing. Growth in 2012-13 is
the lowest in a decade, with the
previous low of 4% recorded in 200203. The estimates for 2012-13 were
released by the Central Statistics
Office (CSO) under the Ministry of
Statistics
and
Programme
Implementation)
6) The Cabinet Committee on Political
Affairs (CCPA) on 30 January 2014
raised the subsidised LPG cylinder
quota from 9 to 12 per year per
household. It also decided to put on
hold the direct benefit transfer scheme
for LPG which linked payment of
subsidy directly into the bank accounts
of the consumers under the Aadhaar
platform. After increase in the cap on
subsidized
LPG
cylinders what
percentage of LPG cylinders are now
covered by subsidisd cylinders? –
Around 97% (Petroleum and Natural
Gas
Minister
Veerappa
Moily
disclosed that 89.2% of the 15 crore
LPG consumers use up to nine
cylinders in a year and only 10% have
to buy the additional requirement at
Page
16 Banking & Finance
the market price. After the quota is
raised to 12, about 97% of the LPG
consumers would be covered by
subsidised LPG)
7) In a first of its kind venture, six
public sector undertakings (PSUs)
including state-run Bharat Heavy
Electricals Limited (BHEL) and Power
Grid Corporation of India Limited
(PGCIL) on 29 January 2014
announced joining hands to set up
world’s largest 4,000 MW ultra mega
solar power project in Rajasthan.
Where in Rajasthan this solar plant
spread across 19,000 acres is going to
be
established?
–Sambhar (The
project will be the largest single
location solar plant spread across
19,000
acres
at
Sambhar
in
Rajasthan. It entails an investment of
Rs. 7,500 crore in the first phase. The
JV will have equity of 26% from BHEL,
23% from SECI (Solar Energy
Corporation of India), 16% from SSL
(Sambhar Salt Ltd), 16% from PGCIL,
16% from SJVNL (Satluj Jal Vidyut
Nigam) and 3% from REIL (Rajasthan
Electronics & Instruments Limited))
8) India’s first monorail – Mumbai
Monorail was opened for the general
public on 2 February 2014 after being
inaugurated on 1 February. Which
authority owns and operates this
monorail
project?
– Mumbai
Metropolitan Region Development
Authority (MMRDA) – The Rs. 3,000crore Mumbai Monorail project is being
implemented in two phases. The
MMRDA has already spent Rs. 1,900
crore of Rs. 3,000 crore allocated for
the project, including the civil work for
the second phase. Commercial
operations of the 8.9-km first phase
connecting Wadala-Chembur stations
on the northeastern fringe of Mumbai
metropolis commenced on 2 February
with the first train leaving the Wadala
station at 7am. The Mumbai Monorail
is not just the first in the country, but
across the subcontinent. Monorails are
in operation in China, Japan,
Singapore, Australia, Dubai, Europe,
and the Americas
9) Vakrangee Ltd., which is engaged
in providing e-governance solutions,
recently came to news for banking
related activities. Why? – It has
received final authorization for
operating White Label ATM (WLA)
license from Reserve Bank of India
(RBI) – Under, the RBI license, the
company is entitled to set up and run
minimum 15,000 ATMs across the
country in next three years. White
label ATMs are those which are not
run by the Banks but by a nonbanking entity in its own brand name
(like Vakrangee ATM) after passing
through all the stringent qualification
and due-diligence process undertaken
by RBI)
10) Tata Chemicals on 23 January
2014 celebrated its platinum jubilee
(75th year) and on this occasion
company’s Managing Director R.
Mukundan rang the opening bell on
the Bombay Stock Exchange. At which
place 75 years back Tata Chemicals
established its first centre of salt and
soda ash production? – Mithapur –
Gujarat(Tata Group was associated
with Mithapur in 1939 when it took
over the Okha Salt Works at Mithapur
near Okha. Mithapur, situated between
Okha and Dwarka, is a small colony
supported by Tata Chemicals Limited,
which is one of the flagship companies
of the Tata Group)
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17 Banking & Finance
Banking & Financial Awareness 6
1) RBI Governor Raghuram Rajan
announced on 12 February 2014 that
in coming days Indian citizens without
a bank account would be able to
withdraw
cash
from
an
ATM
(automated teller machine) with the
help of mobile technology. Payment
banks will play important role in
facilitating this system under which a
payment system will facilitate funds
transfers from bank account holders to
those without accounts through ATMs.
Which
committee
had
recently
recommended
establishment
of
payment banks? – Nachiket More
Committee
on
Financial
Inclusion(The interesting proposal
essentially is that the sender can go to
an ATM with a participating bank and
ask the money to be withdrawn from
his account. The intermediary then
processes the payment and sends a
code via mobile to the recipient. The
recipient takes that code to the nearest
ATM of that participating bank,
punches in the code and withdraws
the money)
2) Till February 2014, the Reserve
Bank of India has issued the certificate
of authorisation to how many non-bank
entities for setting up and operating
white label ATMs (WLAs) in India? –
Four (The entities which got the
permission are Tata Communications
Payment Solutions; Prizm Payment
Services, Mumbai; Muthoot Finance ,
Kochi
and
Vakrangee
Limited,
Mumbai. In June 2012, the RBI issued
guidelines permitting non-bank entities
to set up and operate WLAs in the
country after seeking the RBI’s
authorisation under the Payment and
Settlement Systems Act, 2007. Prior to
this, only banks were permitted to set
up and operate ATMs in India. As
many as 17 entities had sought the
RBI nod for WLAs. WLAs serve
customers from all banks and will be
connected with the entire ATM
network in the country)
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18 Banking & Finance
3) Plastic notes in the denomination of
Rs. 10 will be introduced on a trial
basis in which five cities in the second
half of 2014, as stated by the Union
Government on 7 February 2014 in the
Parliament? – Kochi, Mysore, Jaipur,
Shimla and Bhubaneswar
4) Indian public sector banks went on
a two-day strike from 10 February
2014 after the conciliation effort made
by
the
Central
Chief
Labour
Commissioner to avert the all-India
bank strike scheduled failed. Which
bank union made a call for this strike?
– United Forum of Bank Unions –
UFBU (The talks between the UFBU
and the Indian Banks’ Association over
a five-year wage revision package,
held in New Delhi on 6 February 2014
failed as UFBU alleged that the bank
managements had nothing new to
offer)
5) What is the name of India’s first
public sector unit (PSU), the revival
plan for which was approved by the
Cabinet Committee on Economic
Affairs (CCEA) on 13 February 2014?
– ITI Limited, which was formerly
known as Indian Telephone Industries
Ltd (The company was established in
1948 and was incorporated in 1950
under the then Mysore Companies
Act, 1938 and later converted as the
first PSU of the country to assist the
Government in the sensitive and
strategic telecommunication field. The
company was referred to the Board of
Industrial and Financial Restructuring
(BIFR) in 2004-05 and declared a sick
company. BIFR had recommended a
revival plan for ITI Ltd. The revival plan
will be supported through financial
restructuring
by
fund
infusion
of Rs. 4,156.79 crore)
6) Which company will become India’s
first telecom player to be fully owned
by a foreign company following
approval of company’s FDI proposal
by the Cabinet Committee on
Page
19 Banking & Finance
Economic Affairs (CCEA) on 6
February 2014? – Vodafone (The
CCEA on 6 February approved the
telecom major Vodafone’s Rs 10,141
crore (or $1.6 billion) proposal to buy
out minority shareholders in its Indian
unit. This is the single largest foreign
investment in the telecom sector)
7) The Indian Banks’ Association (IBA)
during February 2014 issued an
advisory to banks to ensure business
continuity after Microsoft ends support
for its popular Windows XP operating
system on 8 April 2014. In its advisory
it drew the attention of banks to a
study by Microsoft in which it claimed
that very large number of Indian public
bank
branches
would
become
vulnerable following the U.S.-based
firm’s decision to stop support to
Windows XP. How many public sector
bank branches were claimed to be
affected? – 34,000 (The fiscal impact
of this could be as much as a loss of
business opportunity worth Rs.1,100
crore in a day and a loss of income
worth Rs.330 crore over a period of
three days. Windows XP – launched in
October, 2001 – is three generations
behind the latest operating system
Windows 8, which was launched in
October, 2012)
8) Who will head the 7th Central Pay
Commission which will revise salaries
of over 50 lakh central government
employees and remuneration of 30
lakh pensioners? –Justice Ashok
Kumar Mathur, former Judge of the
Supreme Court (The composition of
the 7th Central Pay Commission was
approved by the Prime Minister
recently. The other members of the
Commission, include, Oil Secretary
Vivek Rae (full time Member), NIPFP
Director
Rathin
Roy
(part-time
Member) and OSD in Expenditure
Department
Meena
Agarwal
(Secretary). The Commission has
been mandated to submit its report in
two
years
time
and
its
recommendations
would
be
implemented from January 1, 2016.
Earlier in September 2013, the Prime
Minister had approved setting up of
the 7th Pay Commission)
9) The National Organisation of Bank
Workers
(NOBW)
demanded
immediate
reconstitution
of
the
erstwhile
Banking
Services
Recruitment Board (BSRB) to save
banks from staff crunch and work
overload. NOBW claimed that due to
disbanding of BSRB recruitment
process in the banking sector has
almost come to a standstill and as a
result banking transactions have
suffered.
When
was
BSRB
disbanded? –in 2005 (This demand
was made at NOBW’s Golden Jubilee
Celebrations held at Nagpur on 3
February 2014. NOBW also claimed
that most of the staff in the public
sector banks was working beyond their
specific limit, thereby affecting not only
their output but also the overall
functioning of the institutions)
10) Who
took
over
as
Asian
Development Bank’s new Country
Director for India on 3 February 2014?
– Teresa Kho (She was heading the
Bangladesh Resident Mission of ADB
and replaced Hun Kim, who is now
Deputy Director General of ADB’s
South Asia Department in Manila)
Banking & Financial Awareness 7
Page
20 Banking & Finance
fiscal deficit has come down mainly on
account of expenditure compression
and higher realisation from the 2G
spectrum auction)
1) Union
Finance
Minister
P.
Chidambaram presented the Vote-onAccount on 17 February 2014, which
would take care of union expenses
until the government’s term ends in
May 2014. What the expected fiscal
deficit was for 2013-14, as announced
in this vote-on-account? – 4.6% of
GDP (The fiscal deficit, which is the
gap
between
expenditure
and
revenue, was 4.9% of GDP in the
previous financial year. Earlier fiscal
deficit was expected to be around
4.8%. As per current indications, the
2) What is the expected agricultural
growth rate for 2013-14, as announced
in the Vote-on-Account on 17 February
2014? – 4.6%
3) Union
govt.
announced
a
moratorium on interest for educational
loans
in
the
Vote-on-Account
presented on 17 February 2014. With
this announcement 9 lakh student
borrowers are expected to benefit to
the
extent
of Rs. 2,600
crore.
Educational loans taken before which
year would be given moratorium on
interest? – 2009
4) What is the total outlay for defence
for 2014-15, as announced in the
Vote-on-Account on 17 February
2014? – Rs. 2,24,000 crore, which is
10% more than that of 2013-14
5) A venture capital fund for scheduled
castes (SCs) with an initial capital of
Rs. 200 crore was announced in the
Vote-on-Account presented on 17
February 2014. Which financial entity
would set up this VC fund? – IFCI
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21 Banking & Finance
6) Which two business segments were
exempted from the service tax in the
Vote-on-Account presented on 17
February 2014? – Blood banks and
provider of rice warehousing
facilities
7) What is the name of the proposed
agency for better management of the
government’s borrowings which was
announced by the Union Finance
Minister P. Chidambaram in his voteon-account on 17 February? – Public
Debt
Management
Agency
–
PDMA (Chidambaram announced that
the Centre is ready with the Public
Debt Management Agency Bill and
that the proposed agency will be
established as a non-statutory body
and is expected to begin work in the
next fiscal. Former finance minister
Pranab Mukherjee had first announced
setting up of PDMA in his budget
speech of 2011-12. The PDMA is
expected to consist of RBI officials,
civil servants and people from the
private sector)
8) The Reserve Bank of India (RBI)
during February 2014 constituted a
committee
to
examine
the
recommendations of the Financial
Sector
Legislative
Reforms
Commission (FSLRC) relating to
capacity building in the banking sector.
The committee has been tasked with
the
responsibility
of
identifying
capacity
building
requirements
keeping in view the role of financial
sector and what it should deliver. Who
is heading this 9-member committee?
– G Gopalakrishna (G Gopalakrishna
is an Executive Director in the RBI.
The committee will examine the skills
required at various levels/operations to
deliver on the required role and also
identify qualifications relevant to
specific areas of operation in banks
and non-banks. Further, it will evolve
methodologies
for
prescribing
certification for required qualifications)
9) What is the name of the chairperson
and managing director of Kolkataheadquartered United Bank of India
(UBI), who took voluntary retirement
on 20 February 2014? – Archana
Bhargava (Archana Bhargava was
appointed as United Bank’s CMD in
April 2013 and her appointment was
up to February-end 2015. Her
retirement comes in the wake of a
surge in bad loans and the bank
posting a loss in the third quarter.
United Bank’s gross non-performing
assets jumped 194% to Rs. 8,545.50
crore
(includes
fresh
slippage
of Rs. 3,172 crore in the OctoberDecember quarter) as at Decemberend 2013 against Rs. 2,902 crore as at
December-end 2012)
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22 Banking & Finance
10) India Post (Dept. of Posts) on 13
February 2014 launched electronic
Indian Postal Order (e-IPO) for Indian
Citizens living in India. e-IPO facilitates
paying online fee for which purpose? –
For seeking information under the
RTI (e-IPO is a facility to purchase an
Indian Postal Order electronically for
paying RTI fee online through e-Post
Office
Portal
(https://www.epostoffice.gov.in) or
India
Post
web-site
(www.indiapost.gov.in). After paying
the fee online one just need to annex
the print-out of the receipt to the RTI
application. Earlier last year the
Department had launched the e-IPO
on 22 March 2013 for Indian
Citizens living
abroad across
the
globe)
11) Indian market regulator SEBI on
13 February 2014 cleared new
corporate governance norms that
require listed companies to justify CEO
salaries, put in place whistle-blower
policies and have orderly succession
plans. What is the main objective of
this new norm? – To exhort listed
companies and their top executives
to
follow
‘Good
Business
Practices’ (The new norms were
cleared by the SEBI board on 13
February and the relevant provisions
would be incorporated in the listing
agreement soon. The board also
cleared new KRA (KYC Registration
Agency) Regulations that would make
it easier for the investors to comply
with Know Your Client (KYC)
requirements across various segments
of the capital markets)
Banking & Financial Awareness 8
Page
23 Banking & Finance
1) The
Cabinet
Committee
on
Economic Affairs (CCEA) during
February 2014 gave its approval for
foreign equity participation up to 74%
of the paid-up capital of which private
bank based in Kerala? – Federal
Bank(The
74%
foreign
equity
permission comes with sub-limit of
49% for FIIs and 24% for NRIs)
2) State-run United Bank of India
(UBI), which is going through serious
financial mess on account of huge
increase in non-performing assets
(NPAs), is expected to be provided
with how much additional funds by the
union govt. to meet its capital
requirements? – Rs. 1,000 crore (The
bank will issue perpetual noncumulative preference shares to the
govt. to over the crisis created by its
ballooning NPAs. UBI’s CMD Archana
Bhargava had quit the post last week
citing health problems. The bank had
been earlier stopped from issuing any
loans above Rs. 10 crore by the RBI)
3) India’s first all-women bank –
Bharatiya Mahila Bank (BMB) during
February 2014 tied up with which
public-sector
general
insurance
company for launching 3 health
insurance products for women account
holders of the bank? – New India
Assurance (These
policies, BMB
Sakhee, BMB-Nirbhaya and BMBParivar Suraksha provide customised
package of health insurance policies
from New India Assurance. While
Sakhee Policy aimed at rural women,
offers covers up to Rs 50,000, the
Nirbhaya schemes offers cover limit up
to Rs 5 lakh. Parivar Suraksha offers
family floater facilities)
4) During February 2014 who became
the first Indian to be elected President
of Administrative Tribunal of the Asian
Development Bank (ADB)? – Lakshmi
Swaminathan (Swaminathan is the
seventh president of the Tribunal. She
is the first Indian to become the
president of the Tribunal. Of the
previous six presidents, two had been
from the US, two from Philippines, one
from Sri Lanka and one from the UK.
Swaminathan
is
a
jurist
in
administrative law and was the vice
chairman of the Principal Bench at
Delhi of the Central Administrative
Tribunal. Manila headquartered ADB
consists of 64 member countries,
including India)
5) India’s first Post Office Savings
Bank ATM was inaugurated on 27
February 2014 by Finance Minister P.
Chidambaram at – Chennai (India’s
first Post Office Savings Bank ATM
was inaugurated at Thiyagaraya Nagar
Head Post Office in Chennai. This
initiative of opening Post Office
Savings Bank ATM is part of the
government’s Rs. 4,909 crore IT
modernisation
scheme
for
the
Department of Posts specified in the
interim budget for 2014-15)
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24 Banking & Finance
6) Ennore port was on 26 February
2014 officially renamed as Kamarajar
Port Ltd. The decision, which came a
few days ago in the form of Union
Cabinet approval, was formalised with
Union Shipping Minister GK Vasan
unveiling a plaque at a function
organised by the port at Chennai on
26 February. Tamil Nadu has the
maximum number of major ports
(three) in India. Which are the other
two major ports in Tamil Nadu? –
Chennai and Tuticorin
7) What is the name of the volatility
index launched by the National Stock
Exchange on 26 February 2014 which
has been based on the index options
prices of Nifty? –India VIX (India VIX
would provide future contracts facility
to investors and would help investors
hedge near-term volatility risks in their
equity portfolio. India VIX indicates the
investor’s perception of the market’s
volatility in the near term. The index
depicts expected market volatility over
the next 30 calendar days. A high
India VIX value would suggest that the
market expects significant increase in
volatility, while a low value indicates
the reverse. India VIX and Nifty have a
negative correlation)
8) Who was appointed as the new
Chairman and Managing Director of
Oil and Natural Gas Corporation
Limited (ONGC Ltd.) on 26 February
2014? – Dinesh K. Sarraf (The
Appointments Committee of the
Cabinet
(ACC)
approved
the
appointment of Sarraf, who at present
is the Managing Director of ONGC’s
overseas arm, ONGC Videsh Limited
(OVL). Sarraf replaces Vasudeva who
turned 60 on 25 February and retires
on 28 February. The Union Govt.
earlier rejected Oil Minister M.
Veerappa Moily’s proposal to give
Sudhir Vasudeva a post-retirement
extension. ONGC Ltd. is India’s most
profitable company)
9) What is the name of the bitcoin
exchange, which was once the largest
bitcoin exchange in the world and
which on 25 February 2014 came to
news for virtually disappearing from
the internet with many millions of
dollars of customer deposits? – Mt.
Gox (Mt. Gox’s website was down on
25 February and its founder was
unaccounted-for during the day.
MtGox is a Tokyo-based exchange
which allowed users to trade Bitcoins
for US Dollars and several other
currencies. MtGox was going through
some serious problems after news
surfaced that almost 750,000 bitcoins
(currently worth more than £200m)
were missing in the exchange and this
theft went unnoticed for several years)
10) Which public sector undertaking
(PSU) was during February 2014 kept
out of the proposed Central Public
Sector Enterprises (CPSE) Exchange
Traded Fund (ETF)? – PowerGrid
Corporation (With the exit of
PowerGrid Corporation the CPSE ETF
would now consist of 10 PSU firms.
These 10 PSUs are – ONGC, Coal
India Limited, GAIL, Indian Oil
Corporation (IOC), Rural Electrification
Corporation (REC), Oil India Limited
(OIL), Container Corporation of India
Limited (CCIL), Power Finance
Corporation (PFC), Engineers India
Limited (EIL) and Bharat Electronics
Limited (BEL). The proposed CPSE
ETF will serve as an additional
mechanism for the government to
monetise its shareholdings in those
CPSEs that eventually form part of the
ETF basket)
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25 Banking & Finance
Banking & Financial Awareness 9
1) Which
round
of
Inflation
Expectations Survey was launched by
the Reserve Bank of India (RBI) on 3
March 2014? – 35th (These inflation
expectations are to be based on
subjective assessments of about 5,000
households across 16 cities. The
survey seeks qualitative responses
from households on price changes
(they foresee in general prices as well
as prices of specific product groups) in
the next three months as well as in the
next one year and quantitative
responses on current, three-month
ahead and one-year ahead inflation
rates)
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26 Banking & Finance
2) The Reserve Bank of India (RBI) on
3 March 2014 extended the deadline
for the public to exchange currency
notes printed before 2005 up to which
date? – 1 January 2015 (Now the
public would be able to exchange
currency notes printed before 2005 by
1 January 2015. The RBI on 22
January 2014 had announced that it
would withdraw from circulation all pre2005 currency notes from 1 April 2014.
Post-2005 notes have added security
features and help in curbing the
menace of fake currency)
3) Which PSU bank sold its entire
stake in credit information provider
Credit Information Bureau of India
Limited
(CIBIL)
to
Transunion
International Inc (TII) during March
2014?
– Central
Bank
of
India (Central Bank had 5% stake in
CIBIL while TII is the majority
shareholder in CIBIL at 27.5%. State
Bank of India and ICICI Bank carry
10% each, while rest of 2.5% is with
Sundaram Finance Ltd. Among others,
Bank of Baroda, Bank of India, Punjab
National Bank, Union Bank, Citicorp
Finance (India), HSBC, Standard
Chartered Bank, Indian Overseas
Bank and HDFC Ltd each hold 5%
stake in CIBIL)
4) Union Government on 28 February
2014 approved the proposal to ensure
Rs. 1,000 minimum monthly pension
under a scheme of Employees
Provident Fund Organisation (EPFO).
This pension would be provided under
which EPFO scheme? – Employees’
Pension Scheme-95 (EPS-95)
5) The Union government on 4 March
2014 announced raising the interest
rates on select fixed deposit schemes
offered by post offices. Maximum
increase of 0.2% per annum (20 basis
points) was announced on which two
schemes offered by post offices? – 1year term deposit and 2-year term
deposit (The interest on these two
schemes was raised from the present
8.2% per annum to 8.4% per annum.
On the other hand rate of interest was
raised by 0.10% (10 basis points) on
3-year term deposit, 5-year term
deposit and 5-year recurring deposit
schemes. This increase would come
into effect from 1 April 2014)
6) Reserve Bank of India (RBI) on 13
March 2014 hiked the trade related
remittance limit from Rs. 2 lakh to Rs.
5 lakh per transaction. What was the
reason for this increase? – Increase
in the number of transactions
handled by exchange houses (There
is a rapid increase in the number of
the permitted transactions under the
Rupee Drawing Arrangements (RDAs)
due to rapid developments in the
communication facilities)
7) Nishi Vasudev on 1 March 2014
became the first woman to become
head of a prominent blue-chip PSU.
Which PSU is this? – Hindustan
Petroleum Corp Ltd. – HPCL (She
replaced Subir Roy Choudhury)
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27 Banking & Finance
8) Who took over as the new
Chairman and Managing Director
(CMD) of Allahabad Bank on 11 March
2014? – Rakesh Sethi (Prior to this
elevation, Sethi was an executive
director at Punjab National Bank)
9) Which two state-owned companies
on 14 March 2014 bought 10%
government stake in Indian Oil Corp
(IOC) for Rs 5,340 crore? – Oil and
Natural Gas Corp (ONGC) and Oil
India Ltd (OIL) – In off-market
transactions, ONGC and OIL bought
5% stake each at Rs. 220 per share.
This stake sale doubled government’s
disinvestment proceeds for the current
fiscal to Rs 10,434 crore. An
Empowered Group of Ministers
(EGoM) headed by Finance Minister P
Chidambaram had on 28 February
2014 decided to sell the stake in IOC,
the nation’s largest oil firm, at a
discount of 10% through an off-market
deal)
10) Which state was ranked as the
most industry-friendly state in a
Deloitte Touche Tohmatsu study
sponsored
by
the
Planning
Commission? – Haryana (This study
shows that Haryana, Gujarat and
Madhya Pradesh are the top three
industry-friendly states in the country.
Orissa occupied fourth positioned
whereas fifth place was given to
Andhra Pradesh. Bihar ranks sixth,
while Kerala, Rajasthan, Tamil Nadu
and Nagaland followed it. Among the
bottom five states West Bengal,
Maharashtra,
Assam,
Goa
and
Jharkhand occupied top five places
respectively.
This
study
was
commissioned
by
the
Planning
Commission in 2013 and consultancy
firm Deloitte Touche Tohmatsu was
asked to rate states based on certain
parameters that would help them
improve the regulatory ecosystem for
the manufacturing sector. However the
report was not officially released due
to the Model Code of Conduct
imposed by the Election Commission
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28 Banking & Finance
Banking & Financial Awareness 10
1) Who headed the committee on
Credit Information Reports (CIRs),
which submitted its report to the
Reserve Bank of India (RBI) during
March 2014? – Aditya Puri, Chairman
of HDFC Bank (This committee
recommended that customers should
be given a free copy of their credit
profile as it would help in promoting
financial
discipline
among
loan
seekers.
The
committee
also
recommended use of common data
formats and a common data quality
index that could assist credit
institutions in determining the gaps in
data)
2) Which
infrastructure
finance
company during March 2014 received
RBI approval to set up a minimum of
9,000 white label ATMs (WLAs) in the
next three years in rural India? – SREI
Infrastructure
Finance
Ltd (The
company received a certificate of
authorisation from the RBI to set up,
own and operate a payment system
for WLAs effective 25 March 2014.
Through
these
WLAs,
the
infrastructure financial institution will
be able to take financial products and
services of the sponsor bank to the
doorstep of the rural population)
3) What is the name of the prepaid/remittance provider associated
with the m-Pesa platform, which during
March 2014 started a pan-India interbank money transfer service by joining
hands with the Immediate Payment
Service (IMPS) of the National
Payments
Corporation
of
India
(NPCI)?
– Mobile
Commerce
Solutions Ltd (MCSL) – With this tieup, an MCSL (m-Pesa) user can send
money to customers of any IMPSenabled bank using NPCI’s remittance
platform. The National Payments
Corporation of India (NPCI) is the
umbrella organisation of all retail
payment systems in India, set up with
the support of the Reserve Bank of
India and Indian Banks’ Association
(IBA). Immediate Payment Service
(IMPS) is a remittance processing
platform offered by NPCI that offers
instant, 24X7, electronic funds transfer
through mobile, Internet or ATM
between
banks
and
pre-paid
providers)
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29 Banking & Finance
4) Union Government on 21 March
2014 sold its 9% stake in which private
sector bank? – Axis Bank (The stake
was divested through the Specified
Undertaking of UTI (SUUTI), which
was formed in 2003 is an offshoot of
erstwhile UTI and held 20.72% in Axis
Bank. The other promoters of the bank
are Life Insurance Corporation,
General Insurance Corporation, New
India
Assurance
and
National
Insurance Company)
5) The Reserve Bank of India (RBI) on
19 March 2014 allowed five domestic
private banks to import gold. This
decision is expected to give a boost to
gold supplies and bring down
premiums gold prices in India, which is
the world’s second-biggest consumer
after China. Which 5 banks are these?
– HDFC Bank , Axis Bank, Kotak
Mahindra Bank, IndusInd Bank and
YES Bank (Experts of the global gold
market believe that this could be a
significant step towards easing of
tough curbs on the metal imposed last
year to cut the country’s trade deficit)
6) Which state scored the highest in
monthly
per
capita
consumer
expenditure (MPCE) report rankings
for urban areas which was released
during March 2014 by the National
Sample Survey Organisation (NSSO)?
– Haryana (Haryana’s MPCE stood at
Rs. 3817 and it was followed by Kerala
(Rs. 3,408) and Maharashtra (Rs.
3,189). Among urban areas, Bihar (Rs.
1,507) shows the lowest monthly per
capita consumption expenditure. The
68th round survey on level and pattern
of consumption expenditure was
conducted by the NSSO between July
2011 and June 2012)
7) Which state scored the highest in
monthly
per
capita
consumer
expenditure (MPCE) report rankings
for rural areas which was released
during March 2014 by the National
Sample Survey Organisation (NSSO)?
– Kerala (Kerala’s MPCE stood at Rs.
2,669 and it was followed by Gujarat
(Rs. 2,581) and Punjab (Rs. 2,345).
Among rural areas, Orrisa (Rs. 1,003)
displayed the lowest MPCE. The 68th
round survey on level and pattern of
consumption
expenditure
was
conducted by the NSSO between July
2011 and June 2012)
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30 Banking & Finance
8) What is the name of the Deputy
Governor of the RBI who resigned on
20
March
2014?
– KC
Chakrabarty (He
resigned
on
personal grounds three months ahead
of completion of his term. Chakrabarty
was appointed as Deputy Governor in
June 2009 for a period of three years.
In 2012, he got an extension of two
years)
9) Indian market regulator SEBI on 19
March 2014 passed an order against
Financial
Technologies
(FTIL),
declaring it as not fit and proper to
hold any shares directly or indirectly in
any stock exchange or clearing
corporation. FTIL presently holds
equity
stakes
in
which
stock
exchanges of the country? – MCX
Stock Exchange (MCX-SX), National
Stock Exchange (NSE), Delhi Stock
Exchange (DSE), Vadodara Stock
Exchange (VSE) and MCX-SX
Clearing
Corporation
(MCX-SX
CCL) – As per this SEBI order, all
these holdings will need to be
disposed of within 90 days. In
December 2013, the Forward Markets
Commission (FMC) had declared FTIL
as not fit and proper to hold two per
cent or more of the equity share
capital in the Multi Commodity
Exchange of India Ltd (MCX))
10) Union Govt. on 18 March 2014
launched the exchange traded fund of
Central public sector enterprises
(CPSE-ETF) hoping to raise Rs 3,000
crore. The long awaited CPSE-ETF is
an open-ended scheme comprising of
shares of 10 Central public sector
enterprises and it includes ONGC,
Coal India Limited, GAIL, Indian Oil
Corporation (IOC), Rural Electrification
Corporation (REC), Oil India Limited
(OIL), Container Corporation of India
Limited (CCIL), Power Finance
Corporation (PFC), Engineers India
Limited (EIL) and Bharat Electronics
Limited (BEL). Which financial entity is
managing this ETF? – Goldman
Sachs India MF (The CPSE-ETF
tracks an index fund but trades like a
stock on the exchange and is yet
another avenue for the Union Govt. for
selling its stake in CPSEs)
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31 Banking & Finance
Banking & Financial Awareness 11
1) The Reserve Bank of India on 2
April
2014
granted
in-principle
approval of bank licences to which two
entitites?
–IDFC
Limited
and
Bandhan Financial Services Private
Limited (These two firms pipped to
post 23 other applicants, which
included some well-known financial
and industrial houses like Muthoot
Finance, Reliance Capital, Tata Sons,
IFCI, Aditya Birla Nuvo, Bajaj Finserv,
LIC
Housing
Finance, L&T
Finance Holdings and Shriram Capital.
IDFC was established in 1997 and
acts as a specialized financial
intermediary for infrastructure projects.
Bandhan Financial is India’s largest
micro finance institution with over 4.5
lakh borrowers and was set up in
2002)
2) Who was appointed as the new
Deputy Governor of the Reserve Bank
of India (RBI) on 3 April 2014? – R.
Gandhi (He was appointed by the
Union Govt. for a period of three
years. The appointment follows Anand
Sinha relinquishing his charge as
Deputy Governor in mid-January 2014.
The RBI now has four Deputy
Governors – KC Chakrabarty, HR
Khan, Urjit Patel and R. Gandhi.
However, KC Chakrabarty too had
announced his retirement and RBI is
also seeking a replacement for him)
3) The Finance Ministry released a
draft of the Direct Taxes Code (DTC)
on 1 April 2014. This draft focuses on
raising more revenue from high net
worth individuals, while leaving the
slabs unchanged for others. In this
draft high slab of income-tax has been
proposed for individuals and Hindu
Undivided Family (HUF) belonging to
‘super-rich’ category. What is the
criterion of income for this ‘super-rich’
category? – Annual income above
Rs. 10 crore
4) What is the proposed tax slab for
super-rich individuals and Hindu
Undivided Family (HUF) in the draft of
the Direct Taxes Code (DTC), which
was released on 1 April 2014? – 35%
5) What is the proposed additional tax
on those earning over Rs 1 crore
through dividend income in the draft of
the Direct Taxes Code (DTC), which
was released on 1 April 2014? – 10%
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32 Banking & Finance
6) In its first bi-monthly monetary
policy statement issued on 1 April
2014, the RBI announced which major
relief for saving bank account holders?
– It asked banks to cut down
services on low-balance accounts
and do away with fines (In this
regard the RBI said that it proposes to
frame
comprehensive
consumer
protection regulations based on
domestic experience and best global
banking practices. Instead of levying
penal charges for non-maintenance of
minimum balance in ordinary savings
bank accounts, banks should limit
services available on such accounts to
those available to basic savings bank
deposit accounts and restore the
services when the balances improve to
the minimum required level)
7) Private sector bank Axis Bank on 27
March 2014 launched its own Kisan
Credit Card, which is aimed at helping
farmers access liquidity round-theclock. The bank claimed that it is first
new generation private sector bank to
launch an electronic Kisan Credit Card
on the RuPay platform. In which year
the Kisan Credit Card scheme was
launched? – in 1998 (The scheme
was introduced in August 1998 and
since then, a host of banks, a majority
of them in the state-run space, have
launched such cards)
8) The capital market regulator, the
Securities and Exchange Board of
India (SEBI) on 29 March 2014 got
back the power to act against ponzi
schemes, illegal deposit schemes and
assess call data records in securitiesrelated offences after the SEBI
Ordinance was re-promulgated. This
happened after the Finance Ministry
managed to get the nod of the Election
Commission and Cabinet on repromulgation of the SEBI Ordinance
and finally from the President. Under
this ordinance, which pooled money
schemes would be compulsorily
registered with the SEBI? – Schemes
with deposits over Rs. 100
crore (This Ordinance lapsed on 17
January 2014 after the Government
failed in getting the Securities (laws)
Amendment Bill passed in the
monsoon, winter and extended winter
session of the 15th Lok Sabha, which
was adjourned sine die on 21
February 2014)
9) The Reserve Bank of India (RBI) on
27 March 2014 extended the deadline
for implementation of Basel III norms
by the Indian banks to 31 March 2019.
What was the earlier deadline for
implementation of this norm? – 31
March 2018 (Under this norm Indian
banks need to have a core capital ratio
of 8% and a total capital adequacy
ratio of 11.5% against the present 9%.
The norm has been devised to
strengthen the regulation, supervision
and risk management of the banking
sector)
10) Who was appointed as the new
President of the Confederation of
Indian Industry (CII) during March
2014? – Ajay S. Shriram (Ajay S.
Shriram is the Chairman and Sr.
Managing Director of DCM Shriram
Ltd and he was elected as the
President of CII for 2014-15. He
succeeds S Gopalakrishnan of Infosys
as the new President. Naushad
Forbes, Director, Forbes Marshall, has
been elected as the Vice-President)
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33 Banking & Finance
Banking & Financial Awareness 12
1) How much amount was collected by
India’s largest banking group the State
Bank of India (SBI) recently in
overseas debt sale through a dual
tranche bond programme, which make
it the largest ever offering from a
domestic issuer? – $1.25 billion (The
bank raised $750 million in 5-year
money at US treasury interest rate
plus 205 basis points, while it priced
the 10-year $500 million issue at 225
bps over the treasury. The overseas
debt sale programme was completed
on 10 April 2014)
2) Which country during 2013 overtook
Mauritius as the top gateway of money
being brought in by overseas investors
through the foreign direct investment
(FDI) into Indian markets? – The
United States (According to the data
available with the Indian capital
markets regulator SEBI during April
2014, the US accounted for the largest
chunk of assets under the FDI mode
being invested in the Indian equity and
debt markets at the end of 2013 with
over Rs 4.37 lakh crore worth funds.
The US was followed by Mauritius with
over Rs 3.31 lakh crore worth ‘assets
under custody (AUC)’ of FIIs and their
sub-accounts as on 31 December
2013)
3) Which
international
financial
institution on 11 April 2014 completed
Page
34 Banking & Finance
its first global rupee bond programme
worth $ 1 billion? – International
Finance
Corporation
(IFC) –
Washington D.C. headquartered-IFC
completed this huge issue in three
rounds and the third and final round of
bond issue totalling Rs 12 billion
(about $ 194 million) was completed
on 11 April. Under its global rupee
bond programme, IFC has also issued
three-year bonds totalling Rs 30 billion
and five-year bonds totalling Rs 20
billion. This issue was launched to
strengthen India’s capital markets and
attract greater foreign investment)
4) According to the data released by
World Bank Group’s International
Comparison Program (ICP) during
April 2014, India became the third
largest economy in the world. This was
a rapid climb for India as it was ranked
at 10th spot in 2005. However, this
ICP study was not based on
evaluation of actual GDPs of
countries. On which basis was this
ranking
done
by
ICP?
– On
Purchasing Power Parity – PPP (The
GDP of various countries was
evaluated on PPP and it was
evaluated that the purchasing power
parities -based world GDP amounted
to $90,647 billion)
5) With the implementation of new
Companies Act from 1 April 2014, a
majority of the top 200 listed
companies will need to change their
auditors over the next three years.
According to the new Companies Act,
it is now mandatory for the companies
to change their auditors after how
many years? – 10 years (The latest
notified section 139 of the Companies
Act 2013 makes it mandatory for audit
firms to be changed after every 10
years. This has been done in a bid to
ensure objectivity and prevent the
alleged cozy relations between
management and auditors)
6) India retained the top spot in the
world in foreign exchange remittances
from its migratory workforce during
2013. How much remittance was
received by India during the year? –
$70 billion (India was followed by
China ($60 billion), Philippines ($25
billion), Mexico ($22 billion), Nigeria
($21 billion), Egypt ($17 billion),
Pakistan ($15 billion), Bangladesh
($14 billion), Vietnam ($11 billion) and
Ukraine ($10 billion) in the top 10
remittance recipient nations in the
world. This data was disclosed in a
World Bank report on remittances,
which is an annual exercise that
underscores the point that remittances
are an important source of foreign
exchange. One important fact is that
remittance received by India was more
than the $65 billion it earned from
country’s flagship software services
exports)
7) Which two international cement
companies announced their merger on
7 April 2014, which would now create
world’s largest cement manufacturing
company? – Holcim of Switzerland
and Lafarge of France (Holcim and
Lafarge would merge to create a new
company which would be called
“LafargeHolcim”. It would have cement
manufacturing operations in around 90
countries and sales of around $44
billion. The deal will give the group a
market value of close to $60 billion)
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35 Banking & Finance
8) Who was appointed the new
Finance Secretary on 15 April 2014? –
Arvind Mayaram (Arvind Mayaram is
presently
the
Economic
Affairs
Secretary and replaced Sumit Bose
who retired on 31 March 2014)
9) Which famous American bank came
to news during April 2014 for
miscalculating a measure of the capital
on its books which reduced its capital
level by $4 billion? – Bank of
America (Bank of America (BoA) is
the second-largest U.S. bank. It on 28
April 2014 announced that regulators
had suspended its plan to buy back
more shares and raise its dividend
after the bank realized it had
miscalculated a measure of the capital
on its books. The bank said fixing the
mistake reduced a capital level by $4
billion, or about three-quarters of the
extra money that the Federal Reserve
had approved its returning to
shareholders over the next year.
10) Which leading banking luminary
was appointed as the special advisor
of the interim President of BCCI-IPL
Sunil Gavaskar on 11 April 2014? –
Deepak Parekh, Chairman of HDFC
(Parekh will be a special invitee during
the IPL governing council meeting as
his vast experience in financial affairs
will enable Gavaskar to ensure smooth
functioning if IPL for next two months)
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36 Banking & Finance
Banking & Financial Awareness 13
1) RBI Deputy Governor R Gandhi
during May 2014 said that the RBI is
proposing to permit opening of small
bank accounts by merely filling up a
form without any document for
address or identity proof. This is being
proposed in a bid to increase access
to banking services. However, these
proposed small accounts would come
with some limitations. What are these
limitations?
* These accounts will have
limitations on credit/debit balances
* Will be available only at core
banking solution-enabled branches
* No foreign remittances will be
permitted
* Will be available only for 12
months — further extension on
application for officially valid
document
* The aggregate of all credits in a
financial year cannot exceed Rs. 1
lakh
* The aggregate of all withdrawals
and transfers in a month cannot
exceed Rs.10,000
* The balance at any point in time
should not exceed Rs.50,000
2) The Reserve Bank of India (RBI) on
21 May 2014 eased gold import norms
which were imposed during July 2013.
This
was
done
following
representations from jewellers, bullion
dealers, banks, and trade bodies.
What’s the main provision announced
under this? – Select trading houses,
in addition to already permitted
banks, have been allowed to import
gold (The RBI in July last year had
imposed severe restrictions on gold
imports in order to check the
burgeoning current account deficit and
sliding rupee. Now Star trading
houses/premier
trading
houses
(STH/PTH) have been allowed to
import gold under 20:80 gold import
scheme)
3) Shares of state-run banks rose as
much as 5% after an RBI panel report
said that the Government should
reduce the holdings in PSU lenders to
below 50%. Who headed this panel? –
PJ Nayak, ex-Chairman of Axis
Bank (The report was released on 13
May 2014 and had mainly stated that
Government should cut its holding in
public sector banks to below 50%,
criticising the way in which the lenders
are being governed)
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37 Banking & Finance
4) The Reserve Bank of India (RBI)
has put on hold its decision to make
Aadhaar-based
biometric
authentication
for
transactions
mandatory. The Supreme Court had
earlier asked the government not to
link Aadhaar with any social benefit
schemes and subsidies. What was the
main reason for this decision of the
RBI? – Huge time taken for
Aadhaar’s biometric authentication
and high set up costs (In the testing
phase, biometric authentication took
up to 30 seconds even on 3G
connections, as opposed to 5 seconds
otherwise. Banks were also worried
about huge set-up costs needed to
enable the required infrastructure for
biometric authentication)
5) What major relief was announced
by the Reserve Bank of India (RBI) on
7 May 2014 for takers of housing, auto
and personal loans? – It directed all
the commercial banks not to levy
any penalty on pre-payment of
loans under floating rate scheme
that cover housing, auto as well as
personal loans (The RBI advised that
banks will not be permitted to charge
foreclosure charges/ pre-payment
penalties on all floating rate term loans
sanctioned to individual borrowers,
with immediate effect. Floating loan
products include housing, corporate,
vehicle and personal loans. Two years
ago, RBI had barred banks from
levying foreclosure charges or prepayment penalties on home loans on
floating interest rate basis)
6) The Reserve Bank of India (RBI) on
6 May 2014 issued the guidelines
allowing minors to operate bank
accounts independently with a view to
promote financial inclusion and bring
uniformity in opening of such accounts
in banks. What is the prescribed age
for minors to operate bank accounts,
as announced by the RBI in this
guideline?
– Above
10
years (According to the guidelines
issued by the RBI, minors above 10
years of age can open and operate
independently savings bank account
and use other facilities like ATM and
cheque books)
7) A
high-level
committee
recommended recasting of the Index
of Industrial Production and (IIP)
Wholesale Price Index (WPI) with an
objective to present a more realistic
picture of the economy. Who is
heading this high-level committee
which recently submitted its report? –
Saumitra
Chaudhuri,
Member,
Planning Commission and Prime
Minister’s Economic Advisory Council
(The committee submitted its report on
the IIP and WPI during last week of
April 2014. The whole exercise of
recasting these indexes was aimed at
making the indices reflect each other)
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38 Banking & Finance
8) Which country was ranked as the
cheapest among the major world
economies in a latest report by
Germany’s
Deutsche
Bank?
–
India (According to this recently
released report India is the cheapest
major economy on the basis of prices
of products comparable across
countries. The report claimed that a
weaker rupee has allowed India to
remain the cheapest major economy
despite the highest inflation. Australia
was ranked as the most expensive
major economy while the United
States was ranked as the cheapest
developed country. Brazil was again
listed as the most expensive among
developing countries)
9) IPL franchisee Delhi Daredevils
during May 2014 launched a cobranded cricket credit card in
partnership with which commercial
bank? – The Ratnakar Bank Ltd(This
was the first time that a commercial
bank and a leading cricket franchise
came together to launch a co-branded
cricket credit card. The card brings to
its cardholders exclusive privileges like
meeting and greeting the Delhi
Daredevils team, personal and original
memorabilia, coaching camps, free
match tickets, talk shows, etc.)
10) The iconic Ambassador car of
India is almost on its way to become
history as its owner company the C.K.
Birla
Group-promoted
Hindustan
Motors (HM) on 24 May 2014
suspended work at its oldest factory
near Kolkota. Where is this famous
factory situated? – Uttarpara (The
work was suspended due to almost
negligible demand for Ambassador
car, which was once the lifeline of
whole India. Around 2,500 workers
working in the Uttarpara plant are
facing the risk of losing their jobs.
Ambassador was the first car to be
completely made in India some 6
decades back)
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39 Banking & Finance
Banking & Financial Awareness 14
1) The Reserve Bank of India (RBI) on
3 June 2014 announced its first bimonthly monetary policy review after
the new government took charge at
the Centre. RBI Governor kept the
most important repo rate unchanged at
8% and almost all other important
rates were also unchanged. Which is
the only rate which was changed? –
Statutory Liquidity Ratio – SLR (The
SLR of scheduled commercial banks
was reduced by 50 basis points from
23% to 22.5%. This reduction is
expected to infuse liquidity in the
economy by unlocking around Rs.
40,000 crore of bank funds)
2) The RBI in its bi-monthly monetary
policy announced on 3 June 2014
raised the eligibility limit for foreign
exchange remittances from $75,000 to
– $1,25,000 (It was earlier possible to
remit up to $2,00,000 under the
liberalised remittance scheme. This
was reduced to $75,000 last year, as a
prudential measure when the country
was going through a sudden
depreciation of its currency. However,
this limit was raised to $1,25,000, thus
acknowledging the recent stability on
the forex front. This effectively meant
that individuals would now be able to
spend upto $1,25,000 abroad)
3) The Reserve Bank of India (RBI) in
its
bi-monthly
monetary
policy
announced on 3 June 2014 allowed
both residents and non-residents
(except citizens of Pakistan and
Bangladesh) to take out Indian
currency notes up to Rs 25,000 while
leaving the country. What was the limit
for
this
at
present?
–
Rs.10,000 (Currently, only Indian
residents were allowed to take notes
up to Rs 10,000 out of the country)
4) Which country would become the
19th member of Eurozone and the last
Baltic nation to adopt the euro on 1
January 2015 as announced by the
European Commission on 4 June
2014?
– Lithuania (European
Commission announced that Lithuania
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40 Banking & Finance
has fulfilled all conditions to join the
Eurozone and it recommended that
the country would become the
currency bloc’s 19th member on 1
January 2015. Lithuania would be the
last Baltic nation to adopt the euro,
after Estonia did so in 2011 and Latvia
followed suit at the beginning of 2014)
5) Kotak Mahindra Bank shares
slipped after the RBI asked it to reduce
its promoters’ shareholding. The bank
is
to
reduce
its
promoters’
shareholding to what level by
September 2014 as directed by the
RBI? – 40% (Currently, the promoters’
shareholding in the bank is 43.58%.
Hence, the bank’s promoters are
required to shed 3.58% of their share.
In June 2012, the RBI had asked
Kotak Mahindra Bank to reduce the
promoters’ holding to 20% by 2018
and 10% by 2020 from the then
45.21%. This move is to diversify the
promoters’ shareholding and bring it in
sync with the new banking licence
regulations and thereby improve
corporate
governance.
Kotak
Mahindra Bank is a private-sector
bank owned by Uday Kotak)
6) India’s market capitalization during
June 2014 crossed which major
milestone after around 4 years, mainly
on the back of a strong government at
the Centre? –1.5 trillion dollar (The
recent spurt in the market has also
propelled India to be the 10th biggest in
terms of market cap, and the second
biggest in the BRIC group of countries,
behind China which is at $3.23 trillion.
In rupee terms, India’s market cap is at
an all-time high of Rs 89.8 lakh crore.
At the current level, India’s market
cap-to-GDP ratio is about 0.79.
However, this is much lower than the
levels seen during the last bull market
of 2007-08, when the ratio was nearly
2)
7) Curtains may be down on the UP
Stock
Exchange
(UPSE), Uttar
Pradesh’s only trading platform, as the
deadline issued by the Securities and
Exchange Board of India (SEBI)
expired on 30 May 2014. The SEBI
had fixed conditions for UPSE
according to which the annual turnover
of the exchange would have to be
around Rs. 1,000 crore and its networth should be at-least Rs. 100 crore.
In which city is the UPSE situated? –
Kanpur (Kanpur-based UPSE failed
to meet any of the two conditions
prescribed by the SEBI)
8) What is the name of Prime Minister
Narendra Modi’s mega-dream project
of India’s only International Financial
Services
Centre
(IFSC)
being
conceptualised as a global financial
and IT services hub, which on 3 June
2014 announced having achieved
financial closure for its Phase I
infrastructure development? – Gujarat
International Finance Tec-City (GIFT
City) – The GIFT City is being
designed to be at or above par with
globally-benchmarked
financial
centres like those at Shinjuku (Tokyo),
Lujiazui (Shanghai), La Defense
(Paris) and London Dockyards. A
consortium of banks agreed to provide
a loan of Rs 1,157 crore for this
project. The project, spread over 886
acres, including a 261-acre SEZ on
the outskirts of Gandhinagar, is
expected to involve investments of Rs
78,000 crore when completed by
2026)
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41 Banking & Finance
9) Al Hilal Bank, one of the fastestgrowing banks in the UAE, has
implemented
Finacle
e-Banking
solution. Finacle e-Banking solution is
a leading banking solution of which
Indian IT company? – Infosys (The
Finacle e-Banking solution would
enable Al Hilal to provide a range of
Internet banking services to its
corporate customers with highest
security. It would also allow the bank
to roll out new functionalities on a
regular basis and build upon the
existing products to provide an
enhanced banking experience, all at
reduced costs)
10) Prime Minister Narendra Modi on 8
June 2014 unveiled a new book titled
“Getting India Back on Track: An
Action Agenda For Reform”. The
book basically carries a series of
papers on different areas for
presentation to the new government
arguing out the case for the reforms
that would be necessary to get India
back on track. Who are the editors of
this book? – Bibek Debroy, Ashley J.
Tellis and Reece Trevor (The book
has been published by Carnegie
Endowment for International Peace.
The foreword of the book has been
written by Ratan N Tata and it contains
insightful
essays
by
eminent
academicians and public policy
experts)
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42 Banking & Finance
Banking & Financial Awareness 15
1) The Securities and Exchange Board
of India (SEBI) on 17 June 2014 came
out with a consultation paper on an
alternative funding source to help
start-ups struggling to raise funds.
Under this, funding (in small amounts)
is sought from multiple investors
through a web-based platform or a
social networking site for a specific
project, business venture or social
cause. What is the name of this
funding source which is quite popular
in developed countries? – Crowdfunding(According
to
SEBI’s
consultation paper SEBI wants the
issue fund-raising capped at Rs. 10
crore a year for each start-up. Only
national stock exchanges and SEBIregistered depositories are eligible to
set up a crowd-funding platform)
2) The Reserve Bank of India (RBI) on
17 June 2014 asked banks to make
sector-wise
disclosure
of
their
advances from 2014-15 onwards with
a view to encourage them to actively
manage
exposure
to
various
segments. This direction was based
on
which
committee’s
recommendation on this subject? – Dr.
Nachiket
Mor
Committee (The
Committee
on
Comprehensive
Financial
Services
for
Small
Businesses
and
Low
Income
Households under chairmanship of Dr.
Nachiket Mor had recommended that
banks
actively
manage
their
exposures to various sectors, including
priority sectors)
3) India’s capital market regulator
Securities and Exchange Board of
India (SEBI) on 19 June 2014
announced a slew of reforms that
included a proposal to hike public
holding
in
all
public
sector
undertakings (PSUs), new norms for
research analysts and ESOPs given
by listed firms. What is the minimum
public shareholding for PSUs as fixed
by the SEBI? – 25% or Rs. 400 crore
whichever is lower(Currently, PSUs
have to maintain 10% of minimum
public shareholding, while private
companies are required to maintain
25%. Now, the PSUs will be given
three years to achieve minimum public
shareholding of 25%)
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43 Banking & Finance
4) Which bank is organising ‘The
Banking and Economics Conclave
2014′ which was inaugurated by
Reserve Bank of India (RBI) Governor
Raghuram Rajan in Mumbai on 17
June 2014? – State Bank of India –
SBI (This conclave is a national level
banking conclave that has been
organized for the first time. The
conclave is on the lines of ‘Bancon’, an
event organised by Indian Bank’s
Association (IBA) each year. It is also
the first time that a commercial bank
has organised an event of this
magnitude)
5) The Tax Administration Reform
Commission (TARC) headed by
Parthasarathi Shome in its first report
endorsed the recommendations given
by the 1992 committee on tax reforms
for abolishing the post of Revenue
Secretary in the Ministry of Finance.
Who had headed that 1992 committee
on tax reforms which had advocated
path-breaking tax reforms for the
country – Raja J Chelliah (Raja J
Chelliah was instrumental in bringing
about the early reforms to the direct
taxation structure. He served as
chairman of Tax Reforms Committee
of Union govt. between 1991 and 1993
and he was often called ‘The Father of
Tax Reforms’)
6) The Delhi Government on 17 June
2014 announced that the national
capital has become the first ‘kerosenefree city’ in the country. Which scheme
was implemented in the city which
enabled it to do away with the sale of
non-subsidised kerosene in the city –
‘Delhi: A Kerosene-Free City
Scheme, 2012’ (The scheme was
launched in 2012 in collaboration with
three oil marketing companies and the
Union Ministry of Petroleum and
Natural
Gas
for
which
Delhi
Government
had
incurred
an
expenditure of Rs. 62 crores. With
delhi being kerosene-free, India is
expected to save upto Rs. 200 crore
annually)
7) The Wholesale Price Index (WPI)
for the month of May 2014 touched a
5-month high as higher food prices
and fuel costs fuelled price rise. What
was the WPI for May 2014 which was
released on 16 June 2014? –
6.01% (The WPI for April 2014 was
5.20%. As per the data released by
the government, core inflation was at
3.8% as against 3.4% last month.
Primary article inflation stood at 8.58%
as against 7.06% last month. Food
article inflation was at 9.50% as
against 8.64% last month while nonfood article index was up at 1.5%)
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44 Banking & Finance
8) AirAsia India, the Indian arm of the
Malaysian no-frills airline headed by
Tony Fernandes, on 12 June 2014
became the fifth budget carrier in India
as its maiden flight took off on the day.
This first flight of AirAsia was between
which two destinations? – From
Bangalore to Goa (AirAsia became
the fifth budget (no-frills) airline in India
after IndiGo, JetLite, SpiceJet and
GoAir. AirAsia India is a three-way
venture between the Malaysia-based
low-cost airline, India’s Tata Group
and
investment
firm
Telestra
Tradeplace)
9) The shareholders of Reliance
Industries Limited (RIL) got an
opportunity to cast their votes through
e-voting
system
at
company’s
40th Annual General Meeting (AGM)
held on 18 June 2014 at Mumbai. RIL
shareholders cast their votes by
touching the touch-pads of tablet
computers that were brought by
volunteers individually to them.
However, the Ministry of Corporate
Affairs had deferred mandatory evoting for shareholders till which date?
– 31 December 2014 (Thus e-voting
for shareholders would become
mandatory for companies from 1
January 2015. An advantage of evoting is that under it one share has
one vote while under the earlier
system one person has one vote. In
the traditional voting at company
AGM’s hands were shown or lifted in
support of a proposal and it was not
more than a mere formality)
10) Who was during June 2014
appointed the arbitrator from the Union
Finance Ministry in the Rs.20,000crore tax dispute case with U.K.
telecom major Vodafone? – Justice
(Retd.) R. C. Lahoti, Former Chief
Justice of India (The government’s
decision was in response to an
arbitration notice served by Vodafone
International Holdings B.V. in April
2014 under the Bilateral Investment
Protection and Promotion Agreement
between India and the Netherlands for
resolving the dispute. The Union
Cabinet had approved the conciliation
with Vodafone in June last year in a
bid to resolve the capital gains tax
dispute related to its 2007 acquisition
of Hutchison Whampoa’s stake in
Hutchison Essar)
45 Banking & Finance
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