Dedicated to the Young and Energetic Force of Bankers
Sign In/Sign Out

WELCOME

   ABM-Case Studies

   ABM-Recollected

   ABM-Last Minute

   BFM-Case Studies

   BFM-Recollected

   BFM-Last Minute

   Important Circulars

   Master Circulars

   Bank DA Rates

   Bank Holidays

   Life Ins Companies

   List of PSBs

   List of Private Banks

   List of Foreign Banks

 

CAIIB-BFM-RECOLLECTED QUESTIONS FROM JUNE 2018


Friends, Updating here the recollected questions from June 2018 Exams. Wish you all the very best for your exam.

..................................................................................................

Calculation of Economic Value of Equity
Net Worth = 1350.00
Risk Sensitive Asset (RSA) = 18251.00
Risk Sensitive Liability (RSL) = 18590.00
Weight Modified Duration of Asset (DA) = 1.96
Weight Modified Duration of Liability (DL) = 1.25

01. What is Weight (W)?

a. 1
b. 1.02
c. 1.33
d. 1.66

Ans - b

Solution:
Calculate weight (W) = RSL/RSA
=18590/18251
=1.018
=1.02
.............................................

02. What is DGAP?

a. 0.33
b. 0.48
c. 0.69
d. 0.81

Ans - c

Solution
DGAP (modified duration gap) = DA - (W*DL)
= 1.96 - (1.02*1.25)
= 1.96 - 1.1275
= 0.685
= 0.69
.............................................

03. What is Leverage Ratio?

a. 12.33
b. 13.22
c. 13.52
d. 13.66

Ans - c

Solution
Leverage ratio= RSA/ Networth
= 18251/1350
= 13.52
.............................................

04. What is Modified Duration of Equity?

a. 6.33
b. 7.33
c. 8.33
d. 9.33

Ans - d

Solution:
Modified duration of equity (MD) = DGAP * leverage ratio
= 0.69 * 13.52
= 9.3288
= 9.33 years
.............................................

05. If there is 200 bp change in Rate what is drop in Equity Value?

a. 18.66
b. 20.33
c. 22.66
d. 24.33

Ans - a

Solution
Equity value=Change in rate (BP)*MD
=200*9.33/100
=18.6576
=18.66%
.............................................


WEBSITES

  Bank Promotion exams

  Only for Bankers

  RBI

  IIBF

  IRDA

  SEBI

  BCSBI

  CIBIL

  Banking and Insurance

  Ministry of Finance

  Excise & Customs

  Income Tax Department

  NSE

  BSE


       

Copyright @ 2017 : www.jaiibcaiibmocktest.com