Effective For Banking, SBI, IBPS, LIC, NIACL, BoI Exams
When an order cheque is endorsed in blank, it is payable to bearer and transferable by mere delivery.
A cheque crossed “Not Negotiable”, is transferable.
As per section 138 of Negotiable Instruments Act,
there is a provision of penalty when the cheque issued in discharge of a
liability is dishonoured due to insufficient funds in the account and if
the cheque has been presented to the bank within a period of three months and
is not honoured due to insufficient funds.
The cheque on behalf of a partnership firm can
be stopped for payment by anyone partner whether he/she is authorized to operate the account
The marginal farmer is one who possesses
agriculture land upto 1.25 acres of irrigated land or 2.5 acres of
Registration of charge is not required in the
case of pledge, lien, set-off and appropriation.
Loans for construction of godown for own use of
farmers is not part of indirect finance to agriculture.
Nostro account is an account of a bank
established in India with a Foreign Bank in another country and the account is
maintained in foreign currency.
Resident Foreign Currency (RFC) account scheme
is available for home returned Non-resident Indians.
In an overdraft account, when the death notice of
partner is received the bank should stop the operations to avoid
application of Clayton’s case.
A company is not dissolved by lunacy of a
director or bankruptcy of a director or death of a director.
In the case of insolvency, the banker’s
obligation to honour customer cheques comes to an end when the customer is
A lien is the right to retain goods or
securities belonging to a debtor until he has discharged a debt due to the retainer
The shareholders of a Private Limited Co cannot
transfer the shares to any other individual other than the shareholders of the
The term banking has been defined by Banking
Regulation act – 1949
INFINET is – RBI’s VSAT based
The negotiable instruments act is applicable in
the entire part of the country.
If the cheque is drawn in favour of “Mother God” or
order, the cheque is to be returned with the reasons – “since drawn on
Under section 25 of Negotiable Instruments Act,
public holidays are declared by – the respective state governments by
notifications in the official gazettes.
By “General Crossing”, we mean two transverse
parallel lines on top left hand corner of a cheque.
Banks were nationalized under – Banking
Companies (Acquisition and transfer of undertaking) act-1970.
When an account shows debit balance, the
banker is a creditor and when the account shows credit balance, the banker is
The process of replacing paper securities into
electronic holding of shares is known as – dematerialization
Natural guardian under Hindu Minority and
guardianship act, 1956 will be – his father and after him the mother.
For banking transactions, an administrator is one
who is appointed by the court if the deceased has died intestate.
The right of set-off can be exercised by the banker
only when the relationship between the customer and the banker is that of
debtor and creditor.
Limitation period for availing the remedy under
Section 138 of Negotiable Instruments Act is one month from the date of
cause of action.
In Camel’s rating – E stands for earnings.
FIMMDAI means Fixed Income Money Market and
Derivative Association of India.
Chairman and Managing Directors of nationalized
banks are appointed by Central Government
Debt Service Coverage Ratio shows the number of
times the company’s surplus generation covers the payment of interest and
repayment of principal of long debt.
A NRE depositor has issued a power of attorney in
favour of his wife i.e., a resident Indian. She can withdraw cash, issue cheques-crossed
for local payments and deposit into the account a foreign DD favouring the
deposit, however, she cannot deposit foreign currency notes/foreign
The maximum period allowed for FCNR deposits
is- three years
A letter of credit in which the terms and
conditions cannot be amended without the agreement of opening bank, applicant
and the beneficiary is called – Irrevocable letter of credit