M.B.A. DEGREE EXAMINATION, APRIL 2016
Second Semester
PRACTICE OF COMMERCIAL BANKING
(2012 onwards)
Time 3 Hours Maximum 75 Marks
Part A 3 15)
Answer all questions.
All questions carry equal marks.
1. What do you mean by commercial banks?
2. Write a note on NEFT.
3. What is meant by joint account?
4. What are government securities?
5. What is lien?
Part B 10 50)
Answer all questions choosing either or
All questions carry equal marks.
6. Explain the secondary functions of a commercial
bank.
Or
Discuss Indian banking system.
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7. Explain the principles of sound lending.
Or
Explain the precautions to be taken by a banker
while lending housing loans.
8. What are the precautions to be taken by a banker
while opening an account for a joint stock
companies?
Or
Explain procedures to be followed to open an
account in joint account.
9. Explain procedures to be followed while lending
against corporate securities.
Or
Write notes on
Loan against real estate and
Loan against fixed deposits.
10. State the points to be considered while advancing
loans against mortgage.
Or
Distinguish between pledge, hypothecation and
mortgage.
Part C 10 10)
Compulsory.
11. Mr. Saxena was a young officer in an industrial bank at
Chennai. He was approached by Mr. Mehrotra, owner of a
small textile plant, for a loan to renovate his plant.
Saxena gave him a loan of Rs.5,00,000. The bank's
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branch manager, who saw no future in textiles, was
shocked at the loan transaction. He told Saxena to stay
close to Mehrotra until the money was paid back. Saxena
stuck so closethat he became Mehrotra's financial
adviser. The loan was repaid but Saxena became
Mehrotra's partner and resigned his bank job. Within
three years Saxena set up another textile plant and after
two decades his textile unit became the second fastest
growing textile company in the country. Saxena's
management style was characterized by an emphasis on
innovation and tight control. To his employees Saxena
was a friendly and a highly visible boss. He always
walked around the plant and called the vast number of
his workers by their first names. He preferred to lead by
example rather than telling people how to do their jobs.
However, Saxena had a severe heart attack and died.
What is an Industrial Bank? What type of loans can
you get from commercial banks?
Mr. Saxena's wife took over the business and she
wanted to appoint a manager. Suggest a source to
recruit the manager. Give reasons why you selected
such a source.