Banking Loan Clerk Interview Preparation Guide

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A Bank rate is the interest rate that is charged by a country’s central or federal bank on loans and advances to control money supply in the economy and the banking sector. This is typically done on a quarterly basis to control inflation and stabilize the country’s exchange rates. A fluctuation in bank rates triggers a ripple-effect as it impacts every sphere of a country’s economy. For instance, the prices in stock markets tend to react to interest rate changes. A change in bank rates affects customers as it influences prime interest rates for personal loans.

Not a surprising question to ask a bank clerk. Reliability implies the ability to maintain confidentiality and never disclose any banking information to unauthorized persons outside work. Reliability and work ethics also imply the ability to perform customer operations honestly and with care.

Both are used for the transfer of the amount between two accounts of same banks or different bank. ‘Cheque’ is issued by an individual who holds the account in a bank, while ‘Demand draft’ is issued by the bank on request, and will charge you for the service. Also, demand draft cannot be cancelled, while cheques can be cancelled once issued.

Statutory Liquidity Ratio refers to the amount that the commercial banks require to maintain in the form of cash, or gold or govt. approved securities before providing credit to the customers. Statutory Liquidity Ratio is determined and maintained by the Reserve Bank of India in order to control the expansion of bank credit.

The bank earns profit in various ways

☛ a) Banking value chain
☛ b) Accepting deposit
☛ c) Providing funds to borrowers on interest
☛ d) Interest spread
☛ e) Additional charges on services like checking account maintenance, online bill payment, ATM transaction

The ‘balloon payment’ is the final lump sum payment that is due. When the entire loan payment is not amortized over the life of the loan, the remaining balance is due as the final repayment to the lender. Balloon payment can occur within an adjustable rate or fixed rate mortgage.

Availability Float is a time difference between deposits made, and the funds are actually available in the account. It is time to process a physical cheque into your account.

For example, you have $20,000 already in your account and a cheque of another $10,000 dollar is deposited in your account but your account will show balance of $20,000 instead of $30,000 till your $10,000 dollar cheque is cleared this processing time is known as availability float.

NABARD is the apex institution for the development of farm sector , cottage industries and small scale industries in rural areas.

Overdraft protection is a service that is provided by a bank to their customer. For instance, if you are holding two accounts, saving and credit account, in the same bank. Now if one of your accounts does not have enough cash to process the cheques, or to cover the purchases. The bank will transfer money from one account to another account, which does not have cash so to prevent check return or to clear your shopping or electricity bills.

The primary functions of a commercial bank include:
a) accepting deposits; and
b) granting loans and advances

Whenever the banks have any shortage of funds they can borrow it from the central bank. Repo rate is the rate at which our banks borrow currency from the central bank. A reduction in the repo rate will help banks to get Money at a cheaper rate. When the repo rate increases borrowing from the central bank becomes more expensive.The Reverse repo rate is the rate at which the central bank borrows from the banks, while the Repo rate is the rate at which the banks borrow from the central bank.

Besides being presentable in both appearance and demeanor, a bank clerk must be responsible, a quick and efficient worker, and committed to flawless performance. Clients are easily annoyed by mistakes when it comes to their bank accounts and money transactions.

In Derivative market the value of the instruments bought and sold is based on value of the underlying asset. The value of the instrument is ‘derived’ from the value of the underlying asset and hence it is known as Derivatives.

A pay-day loan is generally, a small amount and a short-term loan available at high interest rate. A borrower normally writes post-dated cheques to the lender in respect to the amount they wish to borrow.

‘APR’ (Annual Percentage Rate) can be ‘Fixed’ or ‘Variable’ type. In ‘Fixed APR’, the interest rate remains same throughout the term of the loan or mortgage, while in ‘Variable APR’ the interest rate will change without notice, based on the other factors like ‘prime rate’.

The Bank with a Network of 1176 Branches,1159 ATM centers,and 1408 Grameen vikas kendras as on 30th Sept 2010 .with 10 million coustomers across india.

Investment banking manages portfolios of financial assets, commodity and currency, fixed income, corporate finance, corporate advisory services for mergers and acquisitions, debt and equity writing etc.

Gross Domestic Product is the sum of all the goods and services produced within physical borders of a country in within a specific period of time.

Adjustment credit is a short-term loan made by the Federal Reserve Bank (U.S) to the commercial bank to maintain reserve requirements and support short term lending, when they are short of cash.

COFI is an index that is used to determine interest rates or changes in the interest rates for certain types of Loans.

Cash Reserve Ratio is percentage of customer's deposits with commercial banks that they need to deposit with RBI. Right now it's 4%.

It is the process of converting the physical share certificates into equivalent number of electronic holdings

Because this industry is growing steadily and there would be no limit to my career growth. Further I need stability in my career.

Rate at which RBI lends money to commercial banks without any security.

Policy by which a central authority attempts to control liquidity and interest aimed high growh rate and price stability.