Lending Operations & Risk Management Questions, November, 2010

THE INSTITUTE OF BANKERS, BANGLADESH
Banking Diploma Examination- November, 2010

LANDING OPERATION AND RISK MANAGEMENT
[N.B. All questions are of equal value. Answer any five questions.]

1. a) Discuss the important components those arc to be taken in the consideration in formulating the lending operational policy of a bank.

b) List down the activities those are financed as included in the credit port-folio of your bank.

2. a) Distinguish between term credit and short-term credit. Why do the private commercial banks prefer short term lending? Explain.

b) Do you think that National economy will not flourish if all banks do not equally participate in financing the long-term investment projects? Elaborate your answer.

3. a) Discuss the importance of working capital loan for running an industrial project.

b) How would you assess the working capital requirement of a poultry industry? Prepare a case study assuming 5000 (Five thousand) birds in the poultry firm.

4. a) What do you mean by credit planning? What factors are to be taken into consideration while making a credit plan for a bank?

b) Discuss the important points to be looked into while selecting a prospective good borrower.

5. a) What do you mean by project appraisal? During appraisal of a project loan proposal, what factors does a banker take into consideration? Please explain.

b) Mr. Ali an entrepreneur of your branch area applied for a loan of Tk. 5,00.000 (five lakh) to establish a SME business to your branch. Please write an appraisal report explaining the following points:-

a) About the entrepreneur; b) Enterprise; c) Security; d) Credit need; e) Marketing aspect; I) Managerial ability; g) Recommendation.

6. a) What is fund flow? Discuss the importance of fund flow statement for a bank.

b) Discuss the differences between fund flow and cash flow statement. Please write a sample of a cash flow statement.

7. a) Explain why core risk management is getting so much highlighted for proper financing of a bank.

b) Explain different aspects of credit risk grading (CRG) with grading points.

a) Distinguish between flan write-off and loan rescheduling.

b) Discuss loan re-scheduling rules set by Bangladesh Bank.

9. Write snort notes on any five:‑

a) Debt; equity Ratio;

b) Non-Performing Asset;

c) Loan pricing;

d) Break-even Point;

e) Capital Market;

f) Micro-credit; g) Packing Credit;

g) Loan documentation;

h) Back-to-Back-LC

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Management of Financial Institutions Questions, December- 2013

Banking Diploma Examination, December- 2013

MANAGEMENT OF FINANCIAL INSTITUTIONS (MFI)

Time- 3 hours, Full marks- 100, Pass marks-5O

The figures in the right margin indicate full marks. Answer any five questions.

1. a) Write down the difference between Commercial Bank and Central Bank.

b) Explain the role played by commercial Banks in an

2. a) Explain the problems and prospects of interest rate liberalization.

b) "As compared to other sectors economy, the banking sector is more regulated- Why? What is the impact of such regulation on banking performance?

c) What are the processes of obtaining long-term loan?

3. a) XYZ has 10 percent coupon bonds on the market with nine years left to maturity. Par value of bond is Tk. 1.000 and make annual payment. If the bond currently sells for Tk. 1075, what is its YTM?

b) Determine the duration of the following securities:

Face Value = 1k. 1.000; Coupon Rate = 6% p. a.

Terms of maturity = 2 years YTM = 8%

Coupon payment are to be made semi-annually.

4. a) Why ALM strategy is important in the context of deregulated banking environment of Bangladesh?

b) If a bank has an ROA of 0.80% and Equity Multiplier (EM) of 12, what is the ROE?

How does Bangladesh Bank control its money supply through open market operation?

5. a) What is the financial intermediary? Briefly explain the function of a financial intermediary.

b)  Describe the different types of financial institutions.

c) Discuss the risk management process of a bank

6. The following information is for New Bank Ltd..:

(In millions Tk.)

Interest Income                                                                          Tk. 1875

Interest Expense                                                      Tk. 1210

Total Assets                                                             Tk. 15765

Securities Gain (Loss)                                               Tk. 21

Earnings Assets                                                        Tk. 12621

Total liabilities                                                         Tk. 15440

Taxes                                                                     Tk. 16

Number of Common Shares                                        Tk. 1.45,000

Non Interest Income                                                  Tk. 501

Non Interest Expense                                                          Tk. 685

Provision for Loan l.oss                                             Tk. 381

You are required to calculate: ROE, ROA. NIM. EPS, Net Non Interest Margin and Net Operation Margin.

b) Discuss the various principles of insurance on which insurance companies operate.

7. a) Discuss the important aspects that should be considered by a banker while financing an industrial project.

b) What are the process of measuring and evaluating the performance of a financial institution? Discuss briefly.

8. Write Short Notes (Any Four):

a) Risk Premium

b) Call Option

c) National Payment Switch Bangladesh

d) Portfolio Management

e) Risk weighted Assets

f) Loan Classification

g) Wages theory of profit

h) Marine Insurance

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SME and Consumer Banking Question Paper, June-2013

THE INSTITUTE OF BANKERS, BANGLADESH (IBB)
Banking Diploma Examination, June, 2013

DAIBB
SME & Consumer Banking (SME)
Time-3 hours

[NB.—The figures in the right margin indicate full marks. Answer any five questions.]

1.      Write short notes on any four of the following :—

a. Break-even Point;

b. Net Present Value (NPV);

c. Consumer Banking;

d. Cash-flow Analysis;

e. Venture Capital

f. Equity Entrepreneurship Fund (EEF).

2.     (a) Discuss the importance of SME in economic development of Bangladesh.

(b) Discuss the role of SME Foundation in SME development in the country.

3.     (a) What are the existing sources and areas of SME financing in Bangladesh?

(b) How would you identify and select entrepreneurs for       financing a SME project? Discuss.

4.     (a) Discuss the essentials of a business plan.

(b) Discuss the different cost elements of a SME project.    

5.     (a) What is meant by Project Appraisal?

(b) Discuss in details various aspects of a Project Appraisal.

6.     (a) 'Consumer Credit provokes inflation.' Do you agree with this statement? Discuss in the light of current monetary policy of Bangladesh Bank.

(b) SME is considered as an 'Employment Generating Machine.'-Explain this statement.

7.      Explain in details various methods of creating charge on securities.

8.     (a) What are the risks inherent in lending?

(b) Discuss the risk mitigation tools and techniques.

9.     (a)How would you assess the requirement of working capital of a SME project engaged in manufacturing?

(b) How a repayment schedule is prepared? Give an example.

10.     Discuss in details the procedures of loan recovery focusing on both legal and non-legal aspects.

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