Banking and Financial Awareness

Banking and Financial Awareness 67


1) The ambitious Pradhan Mantri Jan Dhan Yojana (PMJDY)was launched formally on 28 August2014 by the Prime Minister Narendra Modi at function held at Vigyan Bhawan in New Delhi. The scheme promoted mainly to end financial untouchability in India saw the opening of an estimated 1.5 crore bank accounts across the country on this single day. What are the main benefits for families opening accounts under PMJDY?

Explanation :Following are the main benefits for account holders of PMJDY

A RuPay debit card for every account holderRs. 1 lakh accident insurance coverRs. 5,000 overdraft facilityAn additional Rs. 30,000/- life insurance cover for those opening bank accounts before 26 January 2015.2) Which professional services firm was hired by the Union Finance Ministry to undertake a validation exercise of the number of basic bank accounts opened by the banks under the Pradhan Mantri Jan Dhan Yojana (PMJDY)? KPMGExplanation :KPMG would provide some comfort to the Finance Ministry that the numbers submitted by the banks pertaining to PMJDY were accurate and reflected the true picture. KPMGs confirmation of the number of accounts opened will help the Centre pitch for an entry into the Guinness Book of World Records for the maximum number of bank accounts opened in a day. On 28 August 2014, the launch date of the PMJDY, the banking system had opened around 1.5 crore bank accounts. KPMG has already commenced work for this purpose and have approached banks to share information on the number of accounts opened under the PMJDY. Under the PMJDY, the Government is looking to open at least 7.5 crore basic bank accounts for 7.5 crore unbanked families in the country.

.3) What is the slogan (punchline) of Pradhan Mantri Jan Dhan Yojana (PMJDY) which was launched on 28 August 2014? Mera khaata Bhagya vidhataa (which means My Bank Account The Good Fortune Creator)

.4) Which public sector bank on 5 September 2014 Pehla Kadam and Pehli Udaan two new Savings Bank products for children? State Bank of India (SBI)Explanation :

Pehla Kadam is a Savings Bank account for minor of any age operated jointly with his/her parent/guardian, while Pehli Udaan is a singly operated Savings Bank Account for a minor aged 10 years and above and who can sign uniformly. Specially branded passbook and cheque book have been designed for these products. All the account holders will be given an exclusively designed personalised photo ATM-cum-Debit Card. Other features bundled along with the two products include Internet banking with limited transaction facilities like bill payment, opening of fixed deposits, recurring deposits, etc. with per day transaction limit ofRs.5,000, and mobile banking with limited transaction facilities like bill payment, and top-ups with per day transaction limit ofRs.2,000.

.5)The Reserve Bank of India (RBI) during August 2014 notified that the two-step authentication for credit card transactions including card not present transactions is a must as mandated under the rules. This announcement was made by the RBI primarily to set right which anomaly? To bring under check the so-called customer-friendly payment model followed by certain service providersExplanation:

The toughening RBI stance on two-step authentication process is primarily aimed to set right an unintended wrong arising out of the so-called customer-friendly payment model followed by certain service providers. By doing so, they have managed to give the two-step authentication requirement a slip. According to the RBI, however, this is resulting in foreign exchange outflow. The non-adherence to the two-step authentication process has also made the field uneven for players especially in fields such as taxi operation. Frequent taxi users among credit card holders will prefer a cab provider who accepts a hassle-free payment process.

.6) The much-awaited minimum monthly pension ofRs.1,000 and a higher wage ceiling ofRs.15,000 for social security scheme run by retirement fund manager Employees Provident Fund Organisation (EPFO) came into effect from 1 September 2014. This Rs. 1,000 pension scheme is being made available under which scheme of EPFO? Employees Pension Scheme 1995 (EPS-95)Explanation :

The government has notified enhancement of wage ceiling toRs.15,000 per month, fixed minimum monthly pension atRs.1,000 under EPS-95 and enhanced the maximum sum assured under the Employees Deposit Linked Insurance (EDLI) Scheme toRs.three lakh. The governments decision to fix pension entitlement ofRs.1,000 under the Employees Pension Scheme 1995 (EPFS-95) will immediately benefit 28 lakh pensioners who get less than this amount at present. The move to enhance the minimum wage ceiling for becoming a subscriber of Employees Provident Fund Organisation toRs.15,000 per month is expected to bring 50 lakh additional formal sector workers under the ambit of the body.

.7) To strengthen warehousing facilities in the commodity futures market, regulator Forward Markets Commission (FMC) has come out with which important proposal during August 2014? Uniform norms should be established for the accreditation of warehousing service providersExplanation :

The draft rules, on which public comments have been sought by 15 September 2014, come in the wake of Rs 5,600 crore payment scam at the National Spot Exchange Ltd (NSEL) that surfaced in July last year, exposing loopholes in the system. The proposed changes are being made because at present no uniform norms are being followed by national level commodity exchanges for accreditation of warehousing service providers (WSPs).

.8) What is the most important recommendation of the Kelkar Committee on gas pricing, as disclosed in the second report of the committee presented during August 2014? Domestic gas prices should be linked to the marketExplanation :

The committee to recommend a new gas-pricing formula was constituted in 2013 under former Finance Secretary Vijay Kelkar. The suggestion of market-linked pricing for domestic natural gas came after a series of consultations by the committee. The committee in its recommendations said that natural resources should be priced at the highest price possible in the market, based on market-determined pricing. This will ensure energy security for the country by encouraging domestic exploration and production, efficient use of the resource and reduction in the import burden. The first report of this committee was brought out in January 2014.

.9) The Central Board of Direct Taxes (CBDT) on 28 August 2014 constituted a high-level committee to scrutinise all income tax cases arising out of the retrospective tax amendment. Which govt. official heads this committee? The Joint Secretary of the Foreign Tax and Tax Research Unit -1 of CBDTExplanation :

The announcement about this mechanism was announced by Finance Minister Arun Jaitley in his Budget 2014-15 speech on 10 July 2014. According to the terms of reference for the new committee, it would decide on such retrospective cases within of 60 days of receiving them from the Assessing Officer. Retrospective tax is the tax rate levied by income tax department which is perceived higher by the company being assessed, charged higher due to some unknown reasons.

.10) Ratan Tata, Tata Sons Chairman Emeritus, recently made personal investments in which online marketplace company? Snapdeal.comExplanation :

Snapdeal is the second largest online marketplace in India after Flipkart.com. The company has raised about $400 million since its inception and has invested about $100 million in logistics and operations to expand its presence in the $3 billion Indian e-Commerce market. Snapdeal currently houses over 5 million products across 500 diverse categories from over 50,000 sellers. Snapdeal claims that it had seen 600% growth year-on-year for the last two years.


Article Updated on 17 Sep, 2014 | Banking Awareness | RSS Feed for this Article

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1) Which public-sector bank declared Kingfisher Airlines, its promoter Vijay Mallya and three directors as wilful defaulters on 1 September 2014, with which it became the first bank to make such a declaration against Mallya? United Bank of India (UBI)Explanation : Kolkata-based United Bank of India (UBI) is a part of the State Bank of India-led consortium to have financed Kingfisher and has an exposure of around Rs. 400 crore to it. A wilful defaulter tag means Mallya cannot be on the board of any company nor can he raise money from the public. He can also be subjected to criminal proceedings under Sections 403 and 425 of the IPC, dealing with misappropriation and fraud.

..2) The Law Ministry of India has opined that the Government of India has all the powers to print currency notes of Re. 1 denomination. Why the opinion of Law Ministry on this issue was taken? The RBI was of the view that with the repeal of Section 2 of the Currency Ordinance, the Government of India is not empowered to issue note of denominational value of one rupeeExplanation:Section 4 of the Coinage Act of 2011 provides that the central government may authorise minting of coin of denomination not higher than Rs. 1,000. The definition of coin in the Act makes it clear that Government of India one rupee note is included in the definition of coin. The Law Ministry in its opinion stated that the Act, which consolidates the laws relating to coinage and the mints, does not bar the Government of India from printing one rupee notes. The printing of notes in the denominations of Re. 1 and Rs. 2 has been discontinued as these denominations have been coinised. However, such notes issued earlier are still in circulation.

..3) NIFTY, the 50-scrip benchmark index of the National Stock Exchange (NSE) crossed which milestone mark for the first time on 1 September 2014? 8,000 markExplanation : Nifty hit 8,000 level for the first time while Sensex hit a new high of 26,900 on 1 September mainly due to positive GDP growth figures released recently. The CSO had estimated 5.7% GDP growth rate during the first quarter of 2014-15, which is the best quarter performance since March 2012.

..4) The Reserve Bank of India (RBI) cancelled licences of five non-banking financial companies (NBFCs) on 2 September 2014. These NBFCs include Unichem Finance & Enterprises Pvt., Shimansu Vyaparik Kendra Ltd., Shree Bhagwati Marketing Private Ltd. and Sureka Teknik Private Limited. All these NBFCs are based in same city. Which city is this? Kolkata..5) The Competition Commission of India (CCI) during September 2014 initiated an investigation against public sector general insurers and their association. The PSU insurance companies against whom this investigation has been initiated include New India Insurance, Oriental Insurance, United India Insurance and National Insurance, as well as their combine, the General Insurers (Public Sector) Association of India (GIPSA). What is the reason for this investigation? Alleged anti-competitive practices relating to third-party administrators (TPAs) in health insurance committed by these companiesExplanation : The charges against these public general insurers are that they are not allowing TPAs to function independently and have created in-house TPAs to settle any claims. It is also alleged that GIPSA, an ad hoc and unregistered body, was providing a platform to the companies to share sensitive information with each other. This affects competition in the market and also provides space to them for exchanging information regarding claims ratios, marketing efforts and terms and condition of TPAs, among others.

..6) The Union Government during September 2014 asked Expenditure Management Commission (EMC) to suggest an effective strategy for meeting reasonable proportion of expenditure on services through user charges. The newly set up EMC will have to review the major areas of Central Government expenditure and suggest ways for creating fiscal space required to meet developmental expenditure needs. Who is heading EMC? Bimal Jalan (former RBI Governor)

Explanation:Bimal Jalan, who has been conferred with the status of a Union Cabinet Minister, has been asked to design a framework to improve the operational efficiency of expenditures through focus on utilisation, targets and outcomes. Union govt. has asked the EMC to review the fiscal responsibility and budget management (FRBM) rules to suggest improvements for enforcing better fiscal discipline. The EMC, which will be headquartered in New Delhi, will have to submit an interim report before Budget 2015-16.

..7) India has been ranked third in a list of countries most affected by online banking malware during the April-June quarter of 2014 as announced by security solutions provider Trend Micro on 6 September 2014. Which country has been ranked first in this list? JapanExplanation:Japan topped the list with the highest number of online banking malware infections during the April-June quarter of 2014. In May alone, it saw 13,000 malware infections. Japan was followed by U.S. in this list which saw about 5,000 malware infections during the month, followed by India with 3,000 attacks. Growing Internet penetration and rising popularity of online banking have made India a favourite among cybercriminals, who target online financial transactions using malware. These and many such incidents show that cybercriminals will always adapt to new trends and situations whether in the use of new malware or targeted attacks techniques to continue their attacks.

..8) After being in business for seven years, Future Generali Life Insurance has reported its maiden quarterly profit during the quarter ended 30 June 2014. Future Generali Life Insurance is the part of which group? Future GroupExplanation:Future Generali Life Insurance is life insurance venture between Kishore Biyanis Future Group and Italian insurance company Generali.

..9) Barring a few, most of the life insurance companies have disclosed lower persistency ratios for the first quarter of the current fiscal ended 30 June 2014 as also for the full financial year ended 31 March 2014. What is the reason for lower persistency ratio? A new standardised disclosure regime put in place for insurance sectorExplanation: The persistency ratio broadly measures the quantum of the customer retention by the life insurance companies, while determining the percentage of policyholders paying renewal premiums at the end of one year, or more years depending on the tenure of the policy. However, persistency ratio has been one of the most abused financial metric by many insurers, who tend to disclose their best possible persistency ratios without following any standard formula or any specific time period. The insurance sector regulator IRDA earlier this year made changes in norms for such disclosures and put in place a standard formula to be followed by all companies in reporting their 13th month persistency ratios. An analysis of the disclosures made by various life insurers so far this year shows that there has been a marked decline in the high level of persistency reported earlier by many companies.

..10) What is the name of a deadly Trojan virus which hacks and steals personal credit and debit card data and is prowling in the Indian cyberspace as announced on 3 September 2014 by Indian cyber security watchdog CERT-In? Backoff..Explanation : Backoff is being seen spreading through computer networks which use Windows as their operating systems. It targets Point of Sale (POS) systems and propagates by scanning for systems with remote desktop applications enabled. The virus is capable of stealing customer payment cards data like card holders name, account number, expiration data, CVV code among others from POS systems. The virus is so notorious that it is able to capture keystrokes and communicate with the command and control server for further hacking. CERT-In (Computer Emergency Response Team India) is the nodal agency to combat hacking, phishing and to fortify security-related defences of the Indian Internet domain.


Article Updated on 29 Aug, 2014 | Banking Awareness | RSS Feed for this Article

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1) The Reserve Bank of India (RBI) on 18 August 2014 constituted a 15-member inter-regulatory committee to monitor the growing phenomenon of shadow banking. Who has been appointed as the Chairman of this committee? P. Vijaya Bhaskar (Executive Director, RBI)Explanation : Shadow banking refers to banking-like activity by non-banking finance companies (NBFCs) that remain outside the regulatory net. They generally operate as intermediaries between investors and borrowers. The role of this newly constituted committee will be to find out the volume of money in shadow banks, who the investors are and direction of the money flow, etc. Also real estate dealings will be looked into very meticulously by the committee. The 15-member committee comprises of officials of the RBI, Securities and Exchange Board of India (SEBI), Central Economic Intelligence Bureau and the National Housing Bank (NHB).

2) What is the name of the new scheme announced by the Prime Minister Narendra Modi on 15 August 2014 to help the poor in opening bank accounts, which will come with the facility of a debit card and an accidental insurance cover of Rs. 1 lakh? Pradhan Mantri Jan Dhan YojanaExplanation : The Union Cabinet has already cleared the two-phase financial inclusion scheme under which bank accounts will be opened for 15 crore poor persons with an overdraft facility of Rs 5,000 and accidental insurance cover of Rs. 1 lakh. The scheme, to be pushed by the government in a mission mode, seeks to provide two accounts to 7.5 crore identified households by August 2018. The Prime Minister in his Independence Day address observed that people have mobile phones but not bank accounts and he hoped that the scheme will help in bringing the benefits of formal banking system to them.

3)The Reserve Bank of India (RBI) on 22 August 2014 released the charter of customer rights, which seeks to provide the right to be treated with courtesy to both the customer and the financial services provider. What are the important clauses of this charter?

- The customer should not be unfairly discriminated against on grounds such as gender, age, religion, caste and physical ability when offering and delivering financial products by the financial services provider- The key risks associated with the financial product as well as any features that may especially disadvantage the customer should be made known to him/her by the financial services provider- The financial services provider should provide customers with product terms and conditions that are in simple language, easily understandable, and with sufficient information that the customer could be reasonably expected to make an appropriate choice of product- The financial services provider may, however, have certain special products which are specifically designed for members of a target market group or may use defensible, commercially acceptable economic rationale for discriminating between customers4) The Reserve Bank of India (RBI) announced on 14 August 2014 that its board has given approval to create an additional post in the rank of Deputy Governor. For this RBI has approached the government for required legislative changes. Which post is this? Chief Operating Officer (COO)Explanation : The RBI, the central bank of India, is presently headed by a Governor and assisted by four deputy governors looking after different functions of the bank. It now wants to create a post of COO and re-allocate work among the five. The RBI has been deliberating on a broad HR restructuring exercise to align organisational resources and structures with the needs of the domestic economy and changes in the external environment.

5) Who took over as the fourth Deputy Governor of the Reserve Bank of India (RBI) during July 2014? Subhash Sheoratan Mundra or S.S. MundraExplanation : S.S. Mundra took the charge as the Deputy Governor of the RBI on 31 July 2014. Three other deputy governors of the RBI are Urjit Patel, HR Khan, and R. Gandhi. Before taking this responsibility at RBI, Mundra was the Chairman and Managing Director (CMD) of the public-sector bank Bank of Baroda (BOB). Mundra filled the vacancy created by the retirement of K.C. Chakrabarty in April 2014, two months before his five-year tenure was come to an end.

6) On 20 August 2014 the Finance Ministry ordered a forensic audit to be done at the branches of two banks in view of the reports of misappropriation of funds worth Rs. 436 crore. Which two banks are involved in this matter? Dena Bank and Oriental Bank of Commerce (OBC)Explanation : According to media reports, a Mumbai-based branch manager of Dena Bank mobilised fixed deposits (FDs), using middlemen, to the tune of Rs 256.5 crore from seven corporates, while in the case of OBC, misappropriation of funds to the tune of Rs. 180 crore was reported. In the wake of rising scams in public sector banks, the Finance Ministry is looking at various steps, including strengthening of risk management, appointment of bank chiefs for longer tenures, separation of posts and better quality of nominee and independent directors.

7) Which international finance entity launched a $2.5-billion onshore Indian rupee bond programme on 20 August 2014 so as to strengthen the capital market and support infrastructure development in India? International Finance Corporation (IFC)Explanation : IFC is a member of the World Bank Group. It finances and provides advice for private sector ventures and projects in developing countries in partnership with domestic financial institutions and banks. Under the rupee bond programme, IFC will use a combination of rupee-denominated bonds and swaps to raise local currency financing of up to $2.5 billion orRs.15,000 crore over the next five years. Proceeds from the programme will be used for infrastructure investments in India.

8) What is the name of the ambitious e-governance project of the Union Govt., which was approved by the Union Cabinet on 20 August 2014 and which aims to ensure that government services are available to citizens electronically? Digital India ProjectExplanation : The project, which has a total overlay of Rs 1 lakh crore, aims to ensure that government services are available to citizens electronically and help people gain benefits from the latest information and communication technology. Digital India project envisages bringing all the existing initiatives such as the Ebiz project, E-kranti, virtual classroom, e-visas and the National Optical Fibre Network project under a single umbrella. Other programmes include implementation of e-office to make Government departments paperless, encouraging domestic manufacturing of electronic products and kick starting Research & Development and entrepreneurship development fund. The project was unveiled in the Budget 2014-15 and is being directly monitored by Prime Minister Narendra Modi.

9) What is the name of the controversial survey conducted by the Telangana Government throughout the state on 19 August 2014 and due to which various sections of the state were scared and apprehensive? Samagra Kutumbh Survey or Intensive Household SurveyExplanation : The Intensive Household Survey, completed in one day across Telangana, was to identify genuine beneficiaries of government welfare measures. The surveyors sought to see bank account details and the Aadhar card. The government had declared holidays under the Shops and Establishment Act. Residents of Telangana, especially capital Hyderabad, who originally came from Andhra areas were scared with this survey as they felt that the information collected from them would be used against them at a later stage. As various sections of the state populace were apprehensive about this survey, the matter was taken to the Hyderabad High Court about validity of the survey. The High Court on 14 August 2014 permitted the Telangana government to go ahead with the survey on the assurance of the states Advocate General that the exercise was not mandatory and denizens could choose not to answer the queries of enumerators. The survey was conducted across the ten districts in the state with the help of four lakh government employees and a huge team of outsourced enumerators in the state.

10)Indias capital market regulator SEBI on 22 August 2014 ordered which NBFC entity to refund the money raised from some 58.5 million customers through collective investment schemes (CIS)? Pearls Agrotech Corp. LtdExplanation: Delhi-based Pearls Agrotech operates from 15 regional offices and had 3.35 million field associates in 2011-12. SEBI found Pearls Agrotech violating CIS regulations by mobilizing the money without being registered with the regulator. The company offered two kinds of plans- a cash-down payment plan and an instalment payment plan. Under the former, it offered to allot land to customers within 270 days of payment and under the latter within 90 days



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1) The Reserve Bank of India on 14 August 2014 announced its decision to reduce the number of mandated free transactions for savings bank account holders at other bank ATMs located in six metro cities from five to three per month. This reduction would come into effect from which date? 1 November 2014Explanation : The six metro cities (Mumbai, New Delhi, Chennai, Kolkata, Bengaluru and Hyderabad) were chosen first for reducing the number of mandated free transactions as they are well-served in terms of payment infrastructure. This reduction in the number of mandated free transactions will, however, not apply to customers having no-frills/small/Basic Savings Bank Deposit Account (BSBDA) type of accounts as well as for transactions done by savings bank account holders at ATMs situated outside these six metro cities. Banks are also free to offer free transactions above this mandated limit.

2) The Reserve Bank of India (RBI) on 6 August 2014 issued guidelines for asset reconstruction companies (ARCs) to increase their investments in security receipts (SRs) with the objective of strengthening the asset recovery sector. What is the minimum prescribed percentage of funds that ARCs would now have to invest in SRs as directed in this RBI guideline? 15%Explanation : This minimum investment requirement for ARCs was 5% at present. Public sector banks sell their bad loans or NPAs (non-performing assets) to these ARCs. Sale of bad loans to ARCs gained momentum in 2013-14 mainly because banks were able to obtain better prices for these sales. But this RBI directive is likely to dissuade ARCs from offering a better price, since they will now have to make a higher upfront payment.

3) The Reserve Bank of India (RBI) presented its bi-monthly policy review on 5 August 2014. It kept the policy repo rate under the liquidity adjustment facility (LAF) unchanged at 8.0%. It also left the cash reserve ratio (CRR) of scheduled banks unchanged at 4.0% of net demand and time liabilities (NDTL). However, which was the only major rate to be changed in this policy review? The Statutory Liquidity Ratio (SLR)Explanation : The SLR of scheduled commercial banks was reduced by 50 basis points from 22.5% to 22.0% of their NDTL with effect from the fortnight beginning 9 August 2014.

The major rates after this policy review are as follows: * Short-term lending (repo) rate unchanged at 8%

* Cash reserve ratio (CRR) unchanged at 4%

* SLR cut by 0.50% to 22% to unlock banking funds

* Lowers banks SLR holdings in held-to-maturity category by 0.5% to 24%

4) Indian Parliament on 12 August 2014 passed the bill to empower SEBI to act against ponzi operators and market manipulators more effectively. What is the name of this bill? The Securities Law (Amendment) Bill, 2014Explanation : The bill was passed by the Lok Sabha on 6 August 2014 and the Rajya Sabha passed it on 12 August 2014. It empowers SEBI to act against ponzi operators and market manipulators more effectively through search and seizure, attachment orders and recovery proceedings and with access to call data records. This marks a dilution from the direct powers granted to SEBI Chairman through as many as three ordinances in the past one year to authorise search and seizure operations. Under the act constituted (with the passing of this bill), a special SEBI court would be set up in Mumbai to fast track prosecution proceedings launched by SEBI, as also to clear search and seizure operations proposed by SEBI.

5) Indias capital market regulator SEBI cleared final guidelines for creation and listing of business trusts for key sectors of real estate and infrastructure on 10 August 2014. These guidelines have been cleared to help attract greater foreign and domestic investments into these sectors. What are the names of business trusts associated with real estate and infrastructure which would be created and listed with these SEBI guidelines? Real Estate Investment Trusts (REITs) and Infrastructure Investment Trusts (InvITs)

Explanation : Finance Minister Arun Jaitley had outlined the proposal for establishment of Real Estate Investment Trusts (REITs) and Infrastructure Investment Trusts (InvITs) in the Union Budget 2014-15 presented on 10 July 2014. The new norms would enable listing and trading of REITs and InvITs as any other security on the stock exchange platforms and would also help create new platforms for raising of funds by real estate and infrastructure companies. Along with foreign investors, domestic institutions like insurers, pension funds and provident funds would also be allowed to invest in these trusts.

6) In order to solve the ongoing tussle between India and the WTO (World Trade Organisation), India during August 2014suggested fixing of the base year for food subsidies on the basis of average of last three years. What is the year proposed by the WTO to be taken as the base year? 1986-87Explanation : India is of the view that taking 1986-87 as a base year in 2014-15 is completely illogical and it has hence suggested a more scientific calculation for base year calculation. Indian Government had vetoed the adoption of a WTO treaty to simplify, standardise and streamline the rules for shipping goods across borders, having previously agreed to its terms at a ministerial conference in Bali (Indonesia) during December 2013. India wanted more attention paid to its concerns over WTO limits on stockpiling of food which will ultimately hit its subsidised food distribution programme, the worlds largest, targeted at nearly 850 million people.

7) SEBI gave its approval to single registration for stock brokers during August 2014. What would be the main benefit for brokers with this approval? Now the brokers would not need to obtain multiple certificates from SEBI for operating in the different segments of equity, equity derivatives, currency derivative and debtExplanation : Under the proposed regime, initial certificate of registration as stock broker/clearing member will be granted by SEBI and subsequent permissions to act as stock brokers/clearing member of other stock exchanges/clearing corporations will be granted by respective stock exchange/clearing corporation after following the prescribed procedure. The latest SEBI move will also obviate the need for separate certificate for each category of operations trading member, trading-cum-self clearing member and professional clearing member.

8) Petroleum Ministry during August 2014 accorded its in-principle approval for stake-sale in ONGC which may fetch the government aboutRs.18,000 crore to meet disinvestment target for the current fiscal. For this how much stake-sale in the company is proposed? 5%Explanation : As per the Budget 2014-15, the disinvestment target isRs.58,425 crore including receipts from disinvestment of government stake in the non-government companies. The Department of Disinvestment (DoD) has kickstarted the process of stake sale in ONGC and has invited bids for appointing merchant bankers to manage the share sale.

9) Indian Railways during August 2014 launched a contact-less smart card enabling passengers to pay for reserved as well as unreserved travelling train tickets as part of a pilot project. What is the name of this smart card with lifetime validity? Go-IndiaExplanation : The Go-India Card has been launched to be used at nominated UTS counters and Automatic Ticket Vending Machines (ATVMs) and nominated PRS counters for reserved tickets. The card will enable passengers to pay for tickets for long distance reserved, unreserved and suburban journeys. It is part of a pilot project to be implemented on two sectors New Delhi Howrah and New Delhi Mumbai. On New Delhi Howrah sector this card could be used at 6 railway stations New Delhi, Kanpur, Allahabad, Dhanbad, Asansol and Howrah whereas on New Delhi Mumbai sector the card could be used at New Delhi, Kota, Vadodara, Ratlam, Surat and Mumbai Central. The card would be of pre-paid nature and can be bought for Rs. 70 where passenger can get a value of Rs. 20 balance. After that the card can be recharged for Rs. 20 or in multiples of Rs. 50 up to Rs. 5,000. Maximum recharge value for Go-India Card would be Rs. 10,000.

10) What is the name of the proposed airline of Tata-SIA Airlines Limited (TSAL), a joint-venture between Tata Group and Singapore International Airlines (SIA)? VistaraExplanation : The much-anticipated name was announced on 11 August 2014 by TSAL amid the release of the aubergine and gold logo of Vistara. Vistara is derived from the Sanskrit word, which means limitless expanse and draws inspiration from the brands domain the limitless sky.It would be a full service airline service and may take to the skies in October 2014.



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1) The Union Govt. on 26 July 2014 launched a web portal for enabling government-citizen discussions on several issues. What is the name of this portal which was inaugurated by Prime Minister Narendra Modi? MyGovExplanation : The main objective of MyGov is to engage the youth of the country in the nations development. It presents an opportunity to citizens to both discuss and do constructive work. There are multiple theme-based discussions on MyGov where a range of people would share their thoughts and ideas. The portal is implemented and managed by National Informatics Centre (NIC) and the Department of Electronics and Information Technology (DeitY).

.2) Public sector based Central Bank during July 2014 announced its plans to sell 4% of its stake to LIC for Rs. 581 crore. This stake sale is planned to meet banks capital requirement of Rs. 2,000 crore this fiscal. With this proposed sale Union Govt.s holding in Central Bank would come down to 84%Explanation : Presently the Union Govt. holds 88% stake in Central Bank. Once the bank gets funds from LIC, it will then approach the government for around Rs. 1,500 crore of additional capital. The government has earmarked only Rs.11,200 crore for fund infusion into public sector banks this current fiscal, down from Rs.14,000 crore in the last fiscal.

.3) How many banks were fined by the Reserve Bank of India (RBI) on 25 July 2014 for violating central bank rules in the case of Deccan Chronicle Holdings? TwelveExplanation : These 12 banks are Andhra Bank (Rs 10 lakh), Axis Bank (Rs 15 lakh), Canara Bank (Rs 10 lakh), Corporation Bank (Rs 10 lakh), HDFC Bank (Rs 5 lakh), ICICI Bank (Rs 40 lakh), IDBI Bank (Rs 15 lakh), IndusInd Bank (Rs 10 lakh), Kotak Mahindra Bank (Rs 10 lakh), Ratnakar Bank (Rs 5 lakh), State Bank of Hyderabad (Rs 10 lakh) and Yes Bank (Rs 10 lakh). The RBI had carried out a scrutiny of the loan and current accounts of Deccan Chronicle Holdings Ltd., in certain branches of these banks in late 2013. After this scrutiny it came to the conclusion that some of the violations were substantiated and warranted imposition of monetary penalty.

.4) The government of Portugal on 4 August 2014 announced how much relief package for countrys largest listed bank Banco Espirito Santo (BES) to bill out the beleaguered bank? 4.9 billion euros ($6.58 billion)Explanation : This relief package was announced just months after Portugal exited an international bailout and is therefore expected to test the Euro Zones resilience to another banking crisis. The rescue of Banco Espirito Santo would include split of the bank into a good bank, renamed Novo Banco, and a bad bank, which will house BES exposures to the troubled Espirito Santo business empire as well as its subsidiary.

.5) Which telecom company during July 2014 became the first in India to have a combined subscriber base of over 300 million? Bharti Airtel

Explanation : Bharti Airtels subscriber base across mobile, fixed line and DTH services crossed 300 million recently. Companys latest 100 million subscribers were added in less than 2 years. Bharti Airtel has been ranked as the fourth-largest mobile service provider globally and second-largest globally outside of China. It started its operations in 1995 and had touched 100-million customer mark in 2009 and the 200 million mark in 2012.

.6) S.K. Jain, who was arrested by the CBI on charges of allegedly accepting a bribe of Rs 50 lakh to enhance the credit limit of some companies, was the Chairman and Managing Director (CMD) of which public-sector bank? Syndicate BankExplanation : He was arrested on 2 August 2014 by the CBI and was suspended by the Union Govt. on 4 August 2014. Jain was appointed CMD of state-owned Syndicate Bank in July last year for a period of five years. He was one of the youngest CMDs of a public sector bank and was due to retire in 2020.

.7) What is the name of the mission announced by the Union Govt. on 28 July 2014 envisioned to protect the indigenous breeds of cows in the country? Rashtriya Gokul MissionExplanation : Rashtriya Gokul Mission (RGM) was announced as part of BJPs poll promise to protect the cow and its progeny. To protect indigenous breeds, such as Punganur, Vechur and Krishna Valley, the Government plans to set up Gokul Grams (cow sanctuaries), for which public-private partnerships as well as NGOs will be involved. The Government has kept aside Rs. 500 crore for the mission out of the Rs. 1,200 crore allocated for cattle and dairy development during the 12th Plan. Of this Rs. 150 crore will be spent this fiscal.

.8) Which Indian online retailer, during July 2014 raised $1-billion (Rs 6,013 crore) of fresh funds in one of the largest funding for any e-commerce company globally? FlipkartExplanation : Flipkart is the largest online retailer of India with around 22 million registered users and five million shipments in a month. This massive funding was co-led by existing investors Tiger Global Management and Naspers. Singapores sovereign wealth fund GIC, along with existing investors Accel Partners, DST Global, ICONIQ Capital, Morgan Stanley Investment Management and Sofina, also participated in the fund-raising. The company will utilise the proceeds to make long-term strategic investments in India. It is estimated that the firm has, so far, raised over $1.7 billion from investors, including the current transaction.

.9) Palghar became the 36th and the newest district of Maharashtra on 1 August 2014. It was carved out from which district, which was Indias most populous district? ThaneExplanation : The proposal for a new, smaller and manageable Palghar district was hanging fire for over two decades. The proposal was finally cleared by the Maharashtra Cabinet on 13 June 2014. With a population of over 12 million, till 31 July 2014, Thane held the distinction of being the most populated district in the country, spread across 9,600 sq.kms of hills, forests and coastal areas.

.10) Which city would host the 21st Commonwealth Games of 2018? Gold Coast City (Australia)Explanation : Gold Coast City is situated in the Queensland province of Australia. The city would host the 21st Commonwealth Games from 4 to 15 April 2018. The hosting rights to Gold Coast City were awarded in November 2011. It thus would be the fifth hosting of these games in Australia, with the earlier stagings in 1938 (Sydney), 1962 (Perth), 1982 (Brisbane), and 2006 (Melbourne).



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1) What is the minimum paid-up capital limit recommended by the Reserve Bank of India (RBI) for those entities who wish to set up payments and small banks, as announced in the draft rules released by it on 17 July 2014? Rs. 100 croreExplanation : According to the draft guidelines, existing authorised non-bank pre-paid instrument issuers (PPIs), non-banking finance companies (NBFCs), corporate BCs (business correspondents), mobile telephone companies, super market chains, companies, real sector co-operatives and public sector entities are eligible for setting up a payments bank. The guidelines allow even banks to take equity position in a payments bank as permitted under the Banking Regulation Act, 1949. The promoters will have to have an initial minimum capital of at least 40%. It has prescribed a lock-in period of five years for promoters holding. The central bank has sought suggestions and comments on the draft guidelines by 28 August 2014.

..2) Which public-sector undertaking (PSU) on 23 July 2014 became the 17th Navratna status company? Container Corporation of India Limited (CONCOR)Explanation : The Ministry of Heavy Industries and Public Enterprises, Department of Public Enterprises, Government of India granted Navratna status to CONCOR on 23 July 2014. CONCOR is a PSU engaged in providing comprehensive logistics solutions. It has the largest network of 62 inland container depots (ICDs)/container freight stations in India. In addition to providing inland transport by rail for containers, it has also expanded to cover management of ports, air cargo complexes and establishing cold-chain. The Government of India (GoI) holds 61.80% stake in CONCOR (as per the shareholding pattern as on 30 June 2014).

..3) Which private sector bank has agreed to buy a 15% stake in beleaguered Multi Commodity Exchange of India Ltd (MCX), announcement of which pushed the stock value of MCX by more than 10% on 21 July 2014? Kotak Mahindra Bank

Explanation : The commodity market regulator, Forward Market Commission (FMC), had ordered MCX to reduce its promoter- Financial Technologies (FTs) stake from 26 to 2% in December last year after FT was found not fit and proper to own stake in any exchange, following the NSEL crisis. However, since the promoter repeatedly missed the deadline for reducing its stake, the regulator said it would not allow the exchange to issue any new contracts beyond August, unless they did so. The news of Kotak Mahindra Banks buyout has thus come at the right time. Prominent investor Rakesh Jhunjhunwala had also acquired nearly 2% stake in MCX for about Rs. 66 crore during July 2014.

..4) The Bank Employees Federation of India (BEFI) on 19 July 2014 released a list of 1,129 wilful corporate loan defaulters on the occasion of the Bank Nationalisation Day. All the companies mentioned in the list had defaulted loans over Rs. 10 crore. What is the approximate aggregate value of these defaulters? Rs. 54,000 crore

Explanation : The purpose of releasing the list by BEFI on the Bank Nationalisation Day was to put pressure on the defaulters and bank managements. BEFI claimed that a similar list released by unions about five years ago helped some recovery. This list claimed that during the year ended 2013-14, provisioning for Non Performing Assets (NPAs) accounted for Rs. 63,591 crore out of a total operating profit of Rs. 1,27,965 crore. Lanco Mandakini Hydro Energy, Sujana Group, Kingfisher, Progressive Construction, Viceroy Hotels, Regency Ceramics, Nav Bharat International, S Kumars Nationwide Ltd and Deccan Chronicle have been named in the list, among others.

..5) Who was during July 2014 chosen as the head of the committee formed to review the previous UPA governments decision to raise the price of natural gas that would have led to a cascading effect on power tariff, urea costs and retail price of piped cooking gas? Suresh PrabhuExplanation : Suresh Prabhu is a former Union power minister. An indicative terms of reference for the committee includes revisiting the Natural Gas Pricing Guidelines of 2014 (NGPG 2014) and the C. Rangarajan formula and the possibility of applying the same in its present form or with modifications.

..6) Which company on 23 July 2014 became the first Indian company to cross market capitalization value of Rs. 5 lakh crore? Tata Consultancy Services (TCS)Explanation : Market capitalization is the value of a companys outstanding shares and is used to determine a companys size. TCSs market capitalization crossed 5 lakh crore mark on account of appreciation in the price of TCS scrip following good financial results and record dividend declaration by the company. State-held ONGCs market cap of around Rs. 3.5 lakh crore is way behind that of TCS. It is worth mentioning that TCS market cap is more than the combined market cap of its nearest three rivals Infosys (Rs 1.90 lakh crore), Wipro (Rs 1.39 lakh crore) and HCL Tech (Rs 1.07 lakh crore).

..7) The Union Govt. on 19 July 2014 set up an expert committee to look into concerns raised by cost accountants over some provisions in the new Cost Records and Audit Rules. Who is heading this committee? R. S. Sharma, ONGCs former Chairman and Managing Director

Explanation : Following notification of the Companies (Cost Records and Audit) Rules 2014, the Council of the Institute of Cost Accountants of India (ICoAI) had expressed concerns over certain provisions of the rules, particularly coverage of sectors of economy under the rules. The other members of the committee will be R K Jain, Additional Secretary in Ministry of Health and Family Welfare, former ICWAI (Institute of Cost and Works Accountants of India) President Chandra Wadhwa, and Aruna Sethi, Adviser (Cost), Ministry of Corporate Affairs.

..8) Which country on 17 July 2014 became worlds first developed nation to repeal carbon laws that put a price on greenhouse-gas emissions? AustraliaExplanation : Australian upper Senate on 17 July voted 39-32 to scrap the carbon tax that was introduced by centre-left Labour government Prime Minister Julia Gillard in July 2012 and was introduced in November 2013. This tax imposed A $25 (US$23.45) tax per metric tonne of carbon dioxide on countrys worst greenhouse gas polluters. The tax was devised to penalize hundreds the countrys biggest polluters. Australia is one of the largest per capita greenhouse gas emitters due to its reliance on coal-burning power stations to power homes and industry. The carbon tax and plans for an eventual emissions market dominated Australian politics for years, gaining momentum in 2007, when former Labour Prime Minister Kevin Rudd called climate change the greatest moral challenge of our time and made signature of the Kyoto climate protocol one of his first political acts after taking office.

..9) Which country became the first in the world to legalise child labour during July 2014? BoliviaExplanation : While most of the world is trying to diminish child labour, Bolivia has become the first nation to legalise it from age 10. The Congress of this Latin American country had (during early July 2014) approved a legislation legalise child labour from the age of ten. Vice-President Alvaro Garcia signed it into law on 17 July 2014 in the absence of President Evo Morales, who was travelling. Under the legislation, 10-year-olds will be able to work as long as they are under parental supervision and also attend school. It sets 12 as the minimum age for a child to work under contract. They also would have to attend school. The bills sponsors say lowering the minimum work age from 14 simply acknowledges a reality: Many poor families in Bolivia have no other choice than for their kids to work. The bill offers working children safeguards.

..10) Which Southeast Asian country on 20 July 2014 allowed 100% foreign ownership in banks? The PhilippinesExplanation : The order announced on 20 July allows foreign banks to own 100% stock of an existing domestic bank or to open a fully owned subsidiary incorporated under Philippines laws. It replaces a cap of 60% on foreign ownership and abolishes previous rules that allowed just 10 foreign banks in the country. The new law is in preparation for the economic integration of members of the 10-country Association of South-East Asian Nations (ASEAN) in 2015.


Article Updated on 19 Jul, 2014 | Banking Awareness | RSS Feed for this Article

1) What is the definition of affordable housing loans as announced by the Reserve Bank of India (RBI) on 15 July 2014? Rs. 50 lakh in metros and Rs. 40 lakh in non-metros, given by banks from the proceeds of long-term bonds (of minimum seven years maturity)Explanation : This announcement was made by the RBI in a bid to boost the housing sector. The RBI also announced that the cost of a house cannot exceed Rs. 65 lakh and Rs. 50 lakh in the metros and non-metros, respectively, to qualify as affordable houses. There are six metros in the country: Mumbai, Chennai, Kolkata, Delhi, Hyderabad and Bangalore. Under the current regulatory regime, loans given by banks to individuals up to Rs. 25 lakh in metros and Rs. 15 lakh in non-metros for purchase/construction of a dwelling unit, per family, are considered as affordable housing loans. These loans fall under the priority sector lending category for banks. The RBI said that it will periodically review the definition of affordable housing, on account of inflation. This RBI move is expected to make housing loans up to Rs. 50 lakh cheaper.

..2) The fiscal deficit target for year 2015 (2014-15) has been retained at the level announced by former Finance Minister P.Chidambaram in his interim budget. What is this level? 4.1% of GDP (The fiscal deficit which had touched a high of 5.7% in 2011-12, was brought down to 4.8% in 2012-13 and further to 4.5% in 2013-14)

..3) In the Union Budget 2014-15, the govt. announced setting up of a commission to bring in reforms related to spending for achieving maximum output. What is the name given to this commission? Expenditure Management Commission EMCExplanation : The proposed EMC will review the allocated and operational efficiencies of government expenditure to achieve maximum output and will give its interim report within this financial year.

..4) The revival of the Kisan Vikas Patra (KVP) was announced in the Union Budget 2014-15 on 10 July 2014. The KVP was discontinued from November 2011 on the recommendation of which committees recommendations? The Shyamala Gopinath CommitteeExplanation : The Shyamala Gopinath Committee, in its report submitted on 7 June 2011, had recommended that the KVP be discontinued as it was prone to misuse, being a bearer-line instrument. It said the KVP was more popular than the National Savings Certificate (NSC) because of the ease of transfer and liquidity.

..5) What special feature has been proposed for currency notes in the Union Budget 2014-15 presented on 10 July 2014? These currency notes will now also integrate Braille-features to benefit the visually-disabled people..6) What is the proposed name of an integrated Ganga Development Project for which Rs. 2037 crore were allocated in the Union Budget 2014-15? Namami Ganga..7) What is the proposed name of a new 24X7 channel for northeast region that was announced in the Union Budget 2014-15? Arun Prabha..8) Rs. 4200 crore were set for an ambitious Jal Marg Vikas Project on river Ganga in the Union Budget of 2014-15. This project would be established between which two places on Ganga covering a distance of 1620 km? Allahabad (UP) and Haldia (West Bengal)..9) What is the name given to a dedicated TV channel for farmers that was announced in the Union Budget for 2014-15 and Rs. 100 crore was set aside for its establishment? Kisan Television (Kisan TV)..10) What GDP growth rate range for 2014-15 was estimated in the Economic Survey 2013-14, which was tabled on 9 July 2014 in the Lok Sabha? 5.4 to 5.9%Explanation : GDP growth slowed to below 5% for two consecutive years, i.e. 2012-13 and 2013-14. The Economic Survey envisages a better performance during 2014-15 on account of growth in sectors like manufacturing and mining)

..11) What was the fiscal deficit for 2013-14, as disclosed in the Economic Survey 2013-14? 4.5% of GDPExplanation : Fiscal deficitis the difference between the governments expenditures and its revenues. An important factor in the increase in the Centres fiscal deficit after 2008-09 has been the sharp increase in subsidies from 1.42% of GDP in 2007-08 to 2.56% of GDP in 2012-13. For 2013-14 the subsidy bill is 2.26% of GDP.

..12)The panel headed by C. Rangarajan, former Chairman of PMEAC (Prime Ministers Economic Advisory Council), has dismissed the Suresh Tendulkar Committee report on estimating poverty. The report submitted by Rangarajan to Planning Minister Rao Inderjit Singh recently stated that the number of poor in India was much higher in 2011-12 at 29.5% of the population. What was the poverty figure stated for the same year in the Suresh Tendulkar Committee report, which was severely criticized for its findings? 21.9% (According to the Rangarajan panel, poverty stood at 38.2% in 2009-10 and slid to 29.5% in 2011-12. This is at variance with the Tendulkar methodology under which poverty was estimated at 29.8% in 2009-10 and declined to 21.9% in 2011-12. This finding of C. Rangarajan committee means that 3 out of 10 persons in India are poor. The Planning Commission in May 2012 had constituted the expert group under C. Rangarajan to review the Tendulkar Committee methodology for estimating poverty)

..13) Which state has the highest number of people below poverty line according to the new definition of poverty that is part of the new poverty estimates that have been made by a panel led by C. Rangarajan? ChhattisgarhExplanation : According to these estimates 47.9% of Chhattisgarhs population is below poverty line. Chhattisgarh thus tops the list of states with the highest poverty count. On the other had just 6.3% of Goas population is below poverty line and it thus tops the list of states with the lowest poverty count. On a national level, the C. Rangarajan committee report estimated the number of poor at 45.46 crore at 2011-12 prices, which is much higher than the 35.47 crore estimate by the Suresh Tendulkar committee.

..14) What is the operating ratio of Indian Railways as announced in the Rail Budget 2014-15? 94 paise (This means 94 paise put of every Re 1 is utilized. So the surplus for the railways is just 6%)

..15) In how many years Indian Railways would be made paperless as proposed in the Rail Budget 2014-15? 5 years (Facilities like Mobile alerts for wake up calls, arrival alerts and digital reservation charts at station have also been proposed)

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