PPTO 2019 CREDIT MONITORING PAPER I

1. Which among the following correctly explains the meaning of

bankruptcy?

A.Legal status of firm or individual who is unable to meet its debt

obligations

B.A bank not able to recover its due from borrowers

C.An economy not able to recover from recession

D.None of these

E.All of these

2. According to provisions of Insolvency and Bankruptcy Code 2016

(IBC, 2016), who can initiate insolvency resolution process (IRP)?
A. Debtor
B. Creditor
C. Government
D) Reserve Bank of India
Select the correct answer from the options given below:

A.Both A and B

B.Both B and C

C.Only A, B and C

D.All are correct

E.None of these

3. Who will act as regulator under IBC, 2016?

A.Reserve Bank of India

B.Insolvency and Bankruptcy Board of India (IBBI)

C.National Company Law Tribunal (NCLT)

D.All of these

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PPTO 2019 CREDIT MONITORING PAPER I

E.None of these

4. During insolvency resolution process, within how many days

creditor has to proceed with a revival plan failing with company force
to go for liquidation?

A.45 days

B.90 days

C.180 days

D.270 days

E.360 days

5. During insolvency resolution process, how much percentage of

creditors must agree for revival plan to make revival options
applicable?

A.25%

B.50%

C.60%

D.66%

E.75%

6. In case there is complexity in deciding the revival plan, how many

days of one time extension can be provided to creditors to decide on
the revival plan?

A.30 days

B.45 days

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PPTO 2019 CREDIT MONITORING PAPER I

C.90 days

D.100 days

E.120 days

7. Who will acts as adjudicating authority in case of insolvency

resolution for companies?

A.National Company Law Tribunal (NCLT)

B.Debt Recovery Tribunal (DRT)

C.Insolvency and Bankruptcy Board of India (IBBI)

D.Supreme Court

E.None of these

8. Who will acts as adjudicating authority in case of insolvency

resolution for individual or proprietor firms?

A.National law company tribunal

B.Debt recovery tribunal

C.Insolvency Bankruptcy board of India

D.Supreme Court

E. High court

9. In case a company goes for liquidation, which among the following

have the first claim to clear the debts?

A.Secured creditor

B.Workmen dues for 24 months

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PPTO 2019 CREDIT MONITORING PAPER I

C.Unsecured creditors

D.Government dues

E.A & B together

10. Which has become the first bankruptcy case in the country
resolved under Insolvency and Bankruptcy Code 2016?

A.Essar Steel Ltd

B.Monnet Ispat and Energy Ltd

C.Jaypee Infratech Ltd

D.Electro Steel Ltd

CV.Alok Industries

11. What is the minimum amount of default in case of companies to

initiate insolvency process?

A.Rs 1000

B.Rs 10000

C.Rs 100000

D.Rs 1000000

E. No limit

12. For taken over MSE loans external rating is exempted for exposure upto Rs.
A. 15 crores
B. 5 crores
C. 10 crores

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PPTO 2019 CREDIT MONITORING PAPER I

D. Less than 10 crores

E. None of these

13. What is the minimum amount of default in case of individual to

initiate insolvency process?

A.Rs 1000

B.Rs 10000

C.Rs 100000

D.Rs 1000000

E. No such limit

14. All loan accounts of --------------------------- where property is taken as security are to be
subjected to Legal Audit by getting the title deeds re-verified by another empanelled advocate
(other than the one who has given original opinion confirming genuineness of the title deeds) ?
A) Rs 5.00 crores and Above
B) Rs 1.00 crores and Above
C) Rs 2.00 crores and Above
D) Rs 2.50 crores and Above
E) Rs 10.00 crores and Above

15. As on date how many companies has been referred to NCLT

by Reserve Bank of India?

A. 6

B.12

C.18

D. 24

E. 36

16.SARFAESI Act 2002 does not concern which of the following aspects:

A. Securitisation of Financial Assets

B. Reconstruction of Assets
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PPTO 2019 CREDIT MONITORING PAPER I

C. Authority to enforce without the intervention of the court

D. Setting up of Central Registry
E. None of the above

17. In which of the following cases, the constitutional validity of the SARFAESI
Act 2002 was questioned before Supreme Court:
A. Manchester Chemicals vs ICICI bank
B.. Manchester Chemicals vs Union of India
C.Mardia Chemicals vs Union of India. 
D. Mardia Chemicals vs ICICI Bank
E.. none of the above

18. In case of Mardia Chemicals cases in the relation of SARFAESI  Act 2002,
which part was declared as invalid by Supreme Court:
A. pre-condition of deposit of 75% of the amount by the borrower before going to
the DRT
B. pre-condition of deposit of 75% of the amount by the borrower After going to
the DRT
C. pre-condition of deposit of 75% of the amount by the borrower if the bank
sells the immovable property and borrower wants to appeal the DRT
D. the condition of deposit of 75% of amount by the borrower after DRT decision
E. none of the above

19 Under the provision of SARFAESI Act 2002, where a transaction of

securitisation is registered:
A. Registrar of Companies
B. Registrar of Assurances
C. Registrar of Firms
D. Registrar of Central Registry
E. none of the above

20. Under the provision of SARAESI Act 2002 a charge on moveable property in
favour of secured without delivery of possession to the creditor is called:
A. mortgage
B. assignment
C. pledge
D. lien
E. hypothecation

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21. In the process of securitisation the non-liquid financial assets are converted
into markable securities in the form of:
A. shares
B. debentures
C. pass through certificates
D. security receipts
E. bonds

22. What norm has to be followed by a securitisation company regarding owned

funds and the acquired financial assets i.e. owned funds as % age of acquired
assets
A. 20%
B. 15%
C. 12.5%
D.10%
E. 5%
23. At the time of take over the bad loans from 3 banks it is found that these
banks have filed suits in different DRTs. Securitisation company wants to get
these cases in one DRT, which can be permitted by:
A. Central Govt.
B. Supreme Court
C. High Court
D. RBI
E. DRAT

24. When the securitisation company fails to realize the securitized assets, the
qualified institutional buyers holding _______ % of total value of the security
receipts can force the securitisation company for a particular decision:
A. 75%
B. 60%
C. 50%
D. 40%
E. 25%

25. Under the provision of SARFAESI Act 2002 which of the following is not part
of the financial asset reconstruction:
A. take over of management of the unit
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PPTO 2019 CREDIT MONITORING PAPER I

B. sale of the asset

C. re-schedulement of the dues payable by the borrower
D. taking possession of the assets
E.none of the above

26.What is the maximum period allowed to a securitisation company for

recovery of reconstructed financial asset:
A. 2 years   
B. 3 years
C. 4 years
D. 5 years
E. 6 years
27. Under the provision of SARFAESI Act 2002, what is meant by enforcement
of security interest:
A. sale of assets of the borrowing party by the bank
B. sale of charged assets by the secured creditor through DRT
C. sale of charged assets by the secured creditor without court intervention
D. getting bank's charge registered with Central Registry
E.None of these

28. An asset is sold by the secured creditor, what would be the order for the
appropriation of proceeds:
A. first towards costs, charge incidental towards the preservation of securities
etc
B. first towards the dues of the secured creditor
C. first towards costs and dues to the secured on prorate basis
D. secondly, if there is surplus towards other person entitled to the asset
E.None of these

29.If after sale of secured asset, the dues of the secured creditor are not paid
fully, what option does the secured creditor have:

A. he has to write off the same

B. he can file a suit in a civil court
C. he can file a suit in a DRT
D. he can file a suit in DRAT
E. A and C

30. What time period is to be given to the borrower as a notice before sale of the
secured asset?

A. 30 days
B. 45 days
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PPTO 2019 CREDIT MONITORING PAPER I

C. 60 days
D. 75 days
E. 90 days

31.CRILC main report on all borrower entities aggregate exposure of Rs.50

million and above will be submitted on a
A. weekly basis
B.monthly basis
C.Quaterly basis
D.Half yearly basis
E.bimonthly basis

32.The lenders shall report to CRILC all borrower entities in default (with
aggregate exposure of Rs.50 million and above on a
A. weekly basis
B.monthly basis
C.Quaterly basis
D.Half yearly basis
E.bimonthly basis

33.Objectives of credit monitoring are

A.All the laid down procedures of the bank are complied with
B.Ensure that asset in the standard category do not slip to SMA/NPA
C.Identify weak/stressed accounts and take corrective action to protect quality of
asset.
D. Only A & C are correct
E.A, B & C are correct

34. Which of the following are monitoring tools at branch level?

A.Sharp fall in share price

B. Adverse news paper, market reports
C.Monthly monitoring reports
D.A & B Only
E. A, B, & C

35.There is no need to prepare Due Diligence and Legal compliance certificate

for sanctions upto

A. 10 lakhs
B. 25.Lakhs
C. 50.Lakhs
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PPTO 2019 CREDIT MONITORING PAPER I

D.For all loans it has to be prepared.

E.None of the above

36.what is the periodicity and exposure limit for Regional Manger to conduct unit
visit
A.10 crores to fifty crores ,Half yearly
B.50 crores to 100 crores, yearly
C.100 crores above, half yearly
D. 100 crores above yearly
E. RM need not visit
37.AF1109 form is also called as
A.ADV 43
B.ADV 81
C.ADV 84
D.ADV 44
E. No such form exists
38.Delay in submission of stock statement ADV 44 shall not be more than

A.15 days
B. 30 days
C. 7 days
D.45 days
E. 60 days

39.The value in stock in the stock statements shall be cross checked with value
mentioned in…….

A. CCR Form II on the respective dates

B.Provisional/Audited balance sheet on the respective dates
C.A & B
D.Need not be compared
E.None of the above

40.Credit officer shall exclude the following stock from fixing drawing power

A. Stock purchased on credit

B.Stock received under Usance LC
C. Advance payment guarantee
D.A & B
E. A, B, & C

41.If the stock hypothecated are spread over at different places in the city the
branch official should carry out verification as far as possible
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PPTO 2019 CREDIT MONITORING PAPER I

A. At different dates
B.On the same day
C.Borrower should not keep at different places
D.At the convenient of branch official
E. None of the above

42.In respect of inspection of pledge stock which of the statement is not correct
a. The goods shall be inspected at least once in month by the branch official
b. The goods shall be inspected at least once in 3 month by the branch Manager
c.If the stock are held at different godowns in the city the stock should be
verified on different dates
d.The name of the bank should be engraved on the pad lock

A. a, b are not correct

B. a ,b & c are not correct
C. All are not correct
D.Only c is not correct
E. None of the above

43. During the inspection of plant and machinery the following aspects shall be
examined and observations on the same shall be recorded .

(a) Condition of the machinery – whether there has been any break down since the last
inspection and whether any machinery has remained idle - Reasons thereof.
(b The time and cost required to put the machinery into working condition.
(c) Whether there have been any additions or replacements and if so, details thereof.
A. Only A has to be examined

B.Only A & B has to be examined

C. A, B,& C are to be examined

D.None of the above

E. There is no such guidelines

44. The Branch Manager should verify the Inspection register to find out whether all
units have been inspected or not once in

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PPTO 2019 CREDIT MONITORING PAPER I

A.During the first week of every month

B.Every fortnight

C.Bimonthly

D.Quaterly

E Half yearly

45. Which of the following exposure is exempted from reporting CRILC

A. All agriculture Loans

B.Crop loans only

C.Inter Bank Exposure

D.Exposure to NABARD,SIDBI,EXIM Bank & NHB

E.Only B, C. & D exempted

46.The following shall be reported to CRILC

a.Current account balances 100 lakhs and above

b.Red Flaged accounts 50 crores and above

c.Non cooperative borrowers 5 crores above as decided Bank committee

A. Only a is to be reported

B.a & , b are to be reported

C.a, b,& c are to be reported

D. No such rule

E. As per discretion of bank

47.Which of the following Heads ,the validity period of credit limits is not one year

a)Export credit

b)SKCC

c) Synd vyapar scheme

d)ODD
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PPTO 2019 CREDIT MONITORING PAPER I

e) none of the above

48.Read the following statements and answer the below

a)Annual review/ rating is not required in respect of Agriculure loan & upto 1.00
crore loans of Synd Mortgage,SyndRent &,MSME loans

b) Annual review/ rating is required inrespect of all other term loans above 1.00
crore including Syndmortgage and Synd rent

Which of the above statement are correct

A.Only a is correct
B.Only b is correct
C.Both a & b are correct
D.None of them is correct
E.All loans required review/rating

49.Which of the following is not the objective of Bank credit policy

A) Capital driven credit growth

B).Earnings
C) Asset quality
D)Vertical growth
E.None of these

50. Interbank participation certificates are

A. Short term debt instruments

B. Long term debt instruments
C.May be short Term or long term
D.Money market mutual fund
E.None of the above

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PPTO 2019 CREDIT MONITORING PAPER I

KEY TO Credit Monitoring I SET

1 A 11 C 21 D 31 B 41 B

2 A 12 C 22 B 32 A 42 D

3 B 13 A 23 E 33 E 43 C

4 C 14 D 24 A 34 E 44 A

5 D 15 B 25 E 35 B 45 E

6 C 16 E 26 D 36 D 46 C

7 A 17 C 27 C 37 D 47 D

8 B 18 A 28 A 38 C 48 C

9 B 19 D 29 E 39 C 49 D

10 D 20 E 30 A 40 E 50 A

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