CAIIB Questions Case Studies
CAIIB Questions Case Studies
CAIIB Questions Case Studies
Commercial paper:
Certificates of Deposit(CD):
i) Bangladesh
ii) Myanmar
iii) Islamic Republic of Iran
iv) Pakistan
v) Srilanka
vi) Nepal
vii) Maldives
• A small exporter is defined as an exporter whose anticipated total
export turnover for the period of 12 months ahead is not more
than Rs.50 lacs
• Export Turnover policy is for the benefit of large exporters who
contribute not less than Rs.10 lacs per annum towards premium
• A Large Exposure is defined as any exposure to a counter party or
group of counter parties which is equal to 10% of bank’s eligible
capital base(defined as Tier I capital)
• The sum of all the exposure values of a bank to a single
counterparty must not be higher than 20% of the bank’s available
eligible capital base at all times
• The sum of all the exposure values of a bank to a group of
connected counterparties must not be higher than 25% of the
bank’s available eligible capital base at all times
• If the realizable value of security is less than 50% of the value
assessed by the bank then such account is classified under
doubtful category
• If the realizable value of security is less than 10% of the
outstanding in the borrowal accounts, the existence of security
should be ignored and the asset should be classified as loss asset
• The Basel Committee on Banking Supervision(BCBS) has published
13 principles under “Principles for Sound Liquidity Risk
Management and Supervision”
• As per the Basel II norms, total capital ratio should not be lower
than 8%
• The primary function of Treasury is to manage liquidity to meet
CRR requirement
• Front office is headed by Chief Dealer
• Downside potential only captures possible losses ignoring profit
potential
• Volatility captures both upside and downside deviations
• The key driver in managing a business is seeking enhancement in
Risk Adjusted Return on Capital(RAROC)