MA0045 & BANKING MANAGEMENT

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DRIVE - SUMMER 2015

PROGRAM - MBADS (SEM 3/SEM 5) MBAFLEX/ MBA (SEM 3)

SUBJECT CODE & NAME - MA0045 & BANKING MANAGEMENT

BK ID - B1616

CREDITS - 4

MARKS – 60

Q1. Illustrate the transformation of the banking system in India in the post nationalization era. 10

Ans: Transformation of the banking system: A sound and effective banking system in India is necessary for a healthy economy. The banking system of a country should be able to meet the new challenges posed by external and internal factors. The external factors are competition from global players, new entrants from overseas, competition faced by Indian banks in foreign soil, etc. Internal factors include

Q2. Explain the strategies of pricing of business loans by commercial banks to enhance their credit portfolio.( Enhancement of credit portfolio through pricing of business loans by commercial banks) 10

Ans: Pricing Business Loans: Business loans form the core of credit portfolio of banks. Banks scout for enhancement of business loans as a strategy for growth and increase in market share. It may be noted that the major portion of a bank’s fund is employed by way of loans and advances, which is the most profitable employment of its funds. The major part of a bank’s income is earned from interest and discount on the funds so lent.

Q3. Generating Non-interest income and monitoring expenses are key factors for growth and profitability. What are the ratios banks use to evaluate these parameters ?( Ratios of measurement of growth of non-interest income and monitoring expenses) 10

Ans: Non-interest Income: Non-interest income means income other than the interest income. This is earned through commissions, exchanges, and service charges. The overall profitability of the bank depends on maximisation of non-interest income and reduction of overhead expenses. The derivatives of non-interest income are commissions charged on cheque collection, commissions earned through non-fund credits, and letter of credit. The exchanges charged for issue of demand draft and electronic funds transfer and service charges are

Q4. Illustrate the credit process of commercial banks. 10

Ans: Credit Process: Decision making with regard to credit in a bank is all about analysing the risk involved in such lending. In the present day, credit risk management is given more importance in banks. The credit appraisal process requires answering two questions:

·         What are the fund requirements of a applicant borrower and what are his credentials?

·         To what

·          

Q5. Explain some of the money market instruments having short maturity and promising high profitability(Short term and highly profitable money market instruments) 10

Ans: Money market instruments: Banks’ investment consists of different types of instruments. They include money market instruments which are of short maturities like treasury bills, and negotiable certificate of deposits and commercial papers. Capital market instruments have a longer maturity period. They include corporate bonds,

Q6. What are the benefits derived from leveraging technology by banks in India ? 10

Ans: Benefits of Leveraging Technology: Adoption of technology will assist in the increased entry of goods and services. Computerising processes have made banking products and services inexpensive and easy to use. At the same time, they have helped banks to improve operating margins due to the processes of customisation, which allows transactions to take place faster and reduce costs. Technology has increased the options

Dear students get fully solved assignments

Send your semester & Specialization name to our mail id :

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