| Q.1 |
Fill in the blanks: (10) |
i |
Suit for recovery of written-off Finance may
be filed by a Banking Company incorporated in Pakistan, after obtaining
the approval from _______________________.
|
ii |
ii) In case of default in payment of Finance
by a Customer the Bank may sell the Mortgaged Property without the
intervention of ________________________.
|
iii |
If a Customer dishonestly commits a breach
of the terms of Letter of Hypothecation, executed by him, the Bank
may initiate criminal action by filing a Complaint before _____________.
|
iv |
Suit for Recovery of Rs.50.00 M will be filed
by a Banking Company, before _________________ Court.
|
v |
A Charge created by a Company, incorporated
under the Companies Ordinance, 1984, on its Assets other than pledge,
requires Registration within ____________ days with the Joint Registrar
of Companies.
|
vi |
Partner of a Firm, who has not executed Guarantee
in his personal capacity _____________ liable for payment of the
Liability allowed in the name of Partnership Firm.
|
vii |
On tendering resignation by a Director of Limited
Company, he will ______________ absolved from his personal Liability
under the Guarantee executed by him.
|
viii |
A continuing Guarantee ________________ revoked
by the Surety for further Transaction, after giving Notice to the
Beneficiary.
|
ix |
A judgement creditor is a creditor who owes
money to the ________________
|
x |
A garnishee order in the first instance is
issued as a provisional order and is known as a __________ order. |
| Q.2 |
Please write the alphabate of selected answer
in the given space: (15) |
i |
Which of the followings are Promissory Notes:-
A) I, promise to pay Y or order Rs.1,000/- on demand.
B) I, promise to pay Y Rs.1,000/- after deducting
all such Sums which he may owe to me.
C) I, promise to pay Y Rs.1,000/-, one month after
my employment
D) None of the above |
ii |
What Liability the Customer incurs if the Cheque issued by him
in favour of his Bank for re-payment of Debt is returned un-paid
by the paying Banker for the reasons “insufficient funds”:-
A) civil liability B)
riminal liability C)
no liability D) None
of the above |
iii |
To defend a Suit filed by a Bank for recovery of Finance allowed
by it against the Guarantee of (B), from whom (B) will obtain permission
to appear and defend the Suit.
A) State Bank of Pakistan B)
Creditor
C) Banking Court
D) None of the above |
iv |
Maker of a Bill of Exchange is called:-
A) Surety B)
Drawer C)
Promissor D)
None of the above |
v |
The person named in the instrument to whom or to whose order
the money by an instrument is directed to be paid is called:-
A) Receiver B)
Beneficiary C)
Payee D)
None of the above |
vi |
To ensure a healthy and viable banking system SBP takes quantitative
and qualitative steps. Which of the following steps fall under the
quantitative steps:
A) Risk weighted
asset ,capital adequacy B)
Selective credit Control
C) Credit
Plan D)
Guidline for write
off E)
None of the above
|
vii |
Bad/Irrevocable loans may be continued to be written off by banks
themselves with the approval of their respective directors following
upon the permission given by :
A) Banking Company Ordinance
B) Banking
Companies’(Control) Act,1946
C) SBP ACT D)
Prudential Regulations
E)
None of the above |
viii |
Violation of KYC and ANTI-MONEY LAUNDERING policy is penalized
by SBP if the amount involved is more than:
A) Rs.
5 million B)
RS.10
million
C) Rs.15
million D)
RS.20
million and above E)
None of the above |
ix |
Micro financing is considered over the world as:
A) Undesirable
B)
Controversial
C) Excellent
mode of financing for deposit mobilization
D) Good
for developing countries ,only E)
None of the above |
x |
Implementation of Prudential regulations has strengthened:
A)
Financial development of banks
B) Credit
re-scheduling, restructuring
C) Capital
adequacy D)
None of the above E)
All
of the above |
xi |
Writing off of loans in the name of directors or their relatives/dependents/concerns
in which they have interest and in the names of C.E.s of the banks
require prior approval as instructed by:
A) Financial Institutions(Recovery
of finances) Ordinance 2001
B) Baking Companies(Recovery
of loans) Ordinance 1979
C) Prudential regulations
SBP D)
All of the above E)
None of the above
|
xii |
The key issues of nationalized banks were:
A) Inadequate Capital
B)
Insufficient
Reserves
C) Low Recovery D)
All of the
above E)
None of the above |
xiii |
Nomination:
A) Precludes banker’s
right of set off or general lien
B) Does not affect the right
or claim which any person may have
C) Cancels assignment
D) Supersedes the claim of the legal
heirs against the nominees
E) None of the above |
xiv |
Before removing the contents of any locker by any nominee or
by the nominee(s) and the survivors in case o locker held in joint
names, the banks will refer to :
A) Estate Duty Officer B)
Income-tax Officer
C) Court of Law
D) Prepare an inventory of the
contents of the locker which will be signed by the nominee(s) or
the survivor(s)
and the copy of the inventory so prepared will be given to the them/him
E) None of the above |
xv |
In deposits held in joint accounts:
A) Each party
can nominate a person B)
There cannot be more than one
nominee
C) Nomination
facility is not available D)
None of the above |
| Q.3 |
State True or False: (15) |
i |
The Advance allowed for agricultural purposes
is coverable as arrears of Land revenue: |
ii |
A Charge created by a Company on its Stock-in-Trade,
but possession is not Delivered to the Bank is called Pledge: |
iii |
The Bank is obliged to pay the proceeds of
the Draft drawn on it by an Exchange Company of U.A.E, when Cover
has not been provided, by the Drawer: |
iv |
Mortgage Deed executed by a Company, on its
Land, Building and Machinery, duly registered under the Registration
Act is valid against the Liquidator, though the Charge is not registered
with the Registrar of Companies. |
v |
In non-Interest based Financing Demand Finance
falls in the category of Financing by Lending |
vi |
Equity Participation and purchase of shares
is not permissible under NIB |
vii |
Rent sharing is an Islamic mode of financing
|
viii |
There is no difference in Banker’s Lien
and Charge |
ix |
Rule in Clayton’s Case is applicable
only to partnership firm account. |
x |
Anomalous mortgage is governed by Anomalous
Mortgage Act |
xi |
A Floating Charge on the assets of a company
can be likened to Hypothecation |
xii |
Repaying capacity of a borrower is independent
of his worth |
xiii |
Conversion of a cheque means mis-posting of
a cheque |
xiv |
An IOU and a promissory note are one and the
same thing |
xv |
A promissory note which is not stamped is not
valid for litigation and there is no remedy available in this regard
|
xvi |
A post-dated cheque cannot be negotiated |
xvii |
An Acceptor’s for Honour name is mentioned
in the Bill of Exchange |
xviii |
Not Negotiable crossing renders a cheque as
a Transferable instrument |
xix |
The Payee of a cheque is a Holder in Due course
|
xx |
There can be only one Holder in Due Course
at a time of a negotiable instrument |
xxi |
General Crossing is addressed to the collecting
banker |
xxii |
Cheques bearing endorsement in foreign language
should be returned unpaid |
xxiii |
A banker is responsible to the true owner if
he pays a cheque with forged endorsement |
xxiv |
A bank Draft cannot be issued without Account
Payee crossing |
xxv |
Without Recourse and Restrictive Endorsement
are synonyms |
xxvi |
Partial endorsement on a cheque is not possible
|
xxvii |
Banks can collect cheques for themselves without
any risk |
xxviii |
An open cheque cannot be crossed by the banker
unless he is a holder thereof |
xxix |
A collecting bank is discharged of its obligation
toward its customer as soon as the cheque passes to the Clearing
House |
xxx |
There is no difference in spot and ready rate
|
| Q.4 |
On receipt of documents
under a Credit established by the Bank, the documents on their face
do not appear to be in compliance with the terms of the Credit,
what action / steps will be taken by the Bank. (05) |
| Q.5 |
Will the Bank, having received
the Payment in good faith and without negligence of a crossed Cheque
for one of his Customer, having no Title or defective Title, incur
any Liability to the true Owner. Please give reasons and support
your answer with the relevant provision of Law, affording protection
to the collecting Bank. (05)
|
| Q.6 |
Q.6 Please discuss rights and duties of the
Banker in his capacity as:- (10) |
| |
(A) Pledgee B)
Mortgagee C)
Surety |
| Q.7 |
The Customer availed a Finance from your Bank
against:- (05) |
| |
(i) Hypothecation of Stock, ranking Pari-Passu
with ideal bank.
and
(ii) Equitable Mortgage of Property owned by it
by way of 2nd Charge.
The Customer committed default in re-payment of the Advance allowed
by ideal bank. In Liquidation proceedings the Customer has been
wound-up. Please discuss the position in respect of recovery of
your Advance. In what proportion the Sale proceeds of the hypothecated
stock and of the Mortgaged Property will be distributed, between
your Bank and Ideal Bank.
|
| Q.8 |
Discuss the banker and
customer relationship in the light of the definition of customer
given by the SBP with special emphasis on A) collection of cheques,
and B) effect on the management of assets and liabilities. (05) |
| Q.9 |
What are the legal processes
determining bank’s authority to pay cheques. Also discuss
the conditionalities under such processes. (05) |
| Q.10 |
List the precautions that should be taken while
opening and maintaining a Trust ACCOUNT. (05) |
| Q.11 |
Differentiate the following by giving a short
definition of each: (10) |
| |
A) Bearer B)
Holder C) Holder
for Value D)
Holder in DUE Course |
| Q.12 |
Following is an extract from the State Bank
of Pakistan’s circular dated April 03, 2007 (10) |
| |
“In terms of CBR’s Circular of June
27, 2006, the rate of withholding tax has been enhanced from 0.1%
to 0.2% of the amount withdrawn. Furthermore, the limit of Rs.25,000/-
per transaction has been changed to per day basis.
It has been observed that while implementing the
above instructions of CBR, banks are deducting withholding tax from
their customers by clubbing cash withdrawal transactions done on
different dates into a single posting date. This has resulted into
excessive deduction of tax in some instances.
In order to address this issue banks are advised
to immediately discontinue the practice of clubbing cash/ATM transactions
done on different dates into single posting date for the purpose
of determining the amount of withholding tax on such transactions.”
In order to implement these instructions draft
an explanatory note for the guidance of your staff.
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