269 Questions
What is a negotiable instrument according to the Negotiable Instrument Act 1881?
A promissory note, bill of exchange or cheque payable either to order or to bearer
What is the primary characteristic of a negotiable instrument?
It is transferable from hand to hand for value
What does the term 'Negotiable' mean in the context of negotiable instruments?
Transferable by delivery or by endorsement and delivery
What is the purpose of a negotiable instrument?
To settle a debt
What is a characteristic of a negotiable instrument similar to money?
It can be transferred from hand to hand
Who is the person on whom a bill is drawn?
Drawee or Acceptor
What is a characteristic of a cheque?
It is a bill of exchange drawn on a specified banker
Why is a cheque a popular mode of payment?
It can pass from one hand to another easily
What is the significance of a cheque in commercial transactions?
It is the most commercial and safe method of money transaction
What does 'material alteration' include in relation to a cheque?
An alteration of the date or sum
What is the status of the transferee's title if they can prove themselves as a holder in due course?
Not affected by the transferor's defective title
What is the primary characteristic of a Promissory Note?
An unconditional undertaking to pay
Who is the creditor in a Promissory Note?
The payee
What is the primary characteristic of a Bill of Exchange?
An unconditional order to pay
What is the direction of payment in a Bill of Exchange?
From the debtor to the creditor
What type of deposits require a fixed period and rate of interest?
Fixed Deposits
What is required to open an account with a bank?
A filled-in Account Opening Form, Proof of Identity, and a Specimen Signature Card
What is the purpose of a Know Your Customer (KYC) form?
To verify the customer's identity
What document is required for nominees?
Photographs of the nominee(s)
What is essential for a valid contract, as per the Contract Act, 1872?
The customer must be competent to contract
What is a trust according to the Trust Act, 1882?
An obligation annexed to the ownership of property, arising out of confidence reposed in a person or group of persons and accepted by them for the benefit of another or of another and the owner
What is the role of the author of the trust?
To repose or declare confidence
Which chapter of the manual primarily deals with Negotiable Instruments?
Chapter 4
What is the primary focus of Chapter 4 in the manual?
Negotiable Instruments
What is the beneficial interest of the beneficiary?
The right against the trustees as owner of the trust property
What is the Trust Deed according to the Trust Act, 1882?
A document that contains the terms and conditions of the trust
What is NOT a topic discussed in Chapter 4 of the manual?
Bills Collection and Remittance
What should a banker do when opening an account in the names of persons in their capacity as trustees?
Thoroughly examine the Trust Deed appointing the trustees
What is the main theme of the section that precedes Chapter 4 in the manual?
Opening and operations of bank accounts
What is NOT a topic discussed in the manual?
International Trade Finance
What happens to a cheque received in clearing if the order is received before the stipulated returning time of clearing?
It must be returned
Under what condition can a credit be cancelled and a cheque be returned unpaid?
If the credit is not advised and the transfer of amount is done internally in another customer's account
What is the consequence of a bank having a prior right to set-off?
The bank is not bound by the garnishee order
What should be included in a garnishee order received against a joint account?
The full details of the account, including all the names of the joint account holders
What happens if a garnishee order mentions only one of the joint account holders as the judgment debtor?
The bank seeks instructions from the Head Office
What is the rule regarding the attachment of a trust account?
The outstanding in the trust account cannot be attached
What is the liability of partners in a partnership account?
Partners are jointly and severally liable for the firm's debts
What happens to the excess over the lien marked on a Fixed Deposit receipt?
It is attached by the garnishee order
What should be done when a bank has a prior right to set-off and a lien is marked on a Fixed Deposit receipt?
The bank advises the court and the order is vacated
According to sec-13 of Negotiable Instrument Act 1881, what is a negotiable instrument?
A promissory note, bill of exchange or cheque payable either to order or to bearer
What is the primary characteristic of a negotiable instrument?
It is transferable from hand to hand by way of negotiation
What is the term 'Negotiable' mean in the context of negotiable instruments?
Transferable by delivery
What are the characteristics of negotiable instruments like?
Like money, transferable from hand to hand by way of negotiation
What is a written document by which a right is created in favor of some person?
An instrument
Who is the person to whom the amount is payable in a bill of exchange?
Payee
What is a characteristic of a cheque?
It is drawn on a specific banker
What is included in the definition of 'material alteration' in relation to a cheque?
Alteration of the date
What is the significance of a cheque in commercial transactions?
It is a popular and safe method of payment
What is the primary benefit of using a cheque?
It reduces the risk of loss
What is the effect on the transferee's title if the transferor's title is defective?
The transferee's title is not affected if he is a holder in due course
What is the characteristic of a Promissory Note?
It is an unconditional undertaking to pay on demand or at a fixed time
Who is the person who gets the money in a Promissory Note?
Payee
What is a characteristic of a Bill of Exchange?
It is an unconditional order to pay a certain sum of money
What is the direction of payment in a Bill of Exchange?
From the drawer to the drawee
What is the primary focus of Chapter 4 in the manual?
Negotiable Instruments
What is the main topic of Chapter 4 in the manual?
Negotiable Instruments
What is discussed in Chapter 4, along with features and characteristics of negotiable instruments?
Some other important issues
What is the main theme of Chapter 3 in the manual?
Opening & operations of different bank accounts
Which chapter of the manual discusses general banking activities?
Broad areas of the manual
What type of deposits require a fixed period and rate of interest?
Fixed Deposits
What is a common document required for opening a deposit account?
Duly filled in Account Opening Forms
What is the purpose of a Specimen Signature Card in opening a deposit account?
To authenticate the customer's signature
What is required to open an account with a bank?
The customer must be competent to contract as per Contract Act, 1872
What is a characteristic of a time deposit?
The rate of interest is fixed
What is the person who reposes or declares confidence in a trust called?
Author of the trust
What is the instrument by which a trust is created?
Trust Deed
What should a banker examine thoroughly when opening an account in the name of a trustee?
The Trust Deed
What is the subject matter of a trust called?
Trust Property
What is the beneficial interest of the beneficiary in a trust?
The right against the trustee as owner of the trust property
What happens if a credit is made to a customer's account internally, and then the transfer of amount is done in another customer's account?
The credit can be cancelled and the cheque can be returned unpaid.
What is the consequence of a bank having a prior right to set-off?
The bank is not bound by the garnishee order where lien is marked on Fixed Deposit receipts.
What happens to the excess over the lien marked on a Fixed Deposit receipt?
It is attachable by the garnishee order.
What should be included in a garnishee order received against a joint account?
The full details of the account, including all the names of the joint account holders.
What is the liability of partners in a partnership account?
They are jointly liable for the firm's debts.
What happens if a garnishee order is received against a joint account, but only mentions one of the joint account holders as the judgment debtor?
The joint account is not attached.
What is the rule regarding the attachment of a trust account?
The outstanding in the trust account cannot be attached.
What should be done when a bank has a prior right to set-off and a lien is marked on a Fixed Deposit receipt?
The bank should intimate the court and the order must be vacated.
What is the consequence of a credit being cancelled and a cheque being returned unpaid?
The credit can be cancelled and the cheque can be returned unpaid, provided credit is not advised.
What happens to a cheque received in clearing if the order is received before the stipulated returning time of clearing?
The cheque must be returned.
Who is the person to whom the amount is payable in a bill of exchange?
Payee
What is included in the definition of 'material alteration' in relation to a cheque?
Alteration of the date and amount
What is the significance of a cheque in commercial transactions?
It is a popular mode of payment due to low transfer cost and minimal loss possibility
Who is the person who draws a bill of exchange?
Drawer
What is a characteristic of a cheque that makes it a popular mode of payment?
It is a negotiable instrument that can be passed from one hand to another easily
Which chapter of the manual discusses Negotiable Instruments?
Chapter 4
What is the term for a document that creates a right in favor of a person?
Instrument
What is the primary focus of Chapter 4 in the manual?
Negotiable Instruments and capacity development aspects
What is discussed in Chapter 4, along with features and characteristics of negotiable instruments?
Risk issues and capacity development aspects
What is the primary characteristic of a negotiable instrument?
It is transferable by delivery
What is the main topic of Chapter 4 in the manual?
Negotiable Instruments
What is the term 'Negotiable' mean in the context of negotiable instruments?
Transferable by delivery
In which chapter are negotiable instruments, their features, and characteristics discussed?
Chapter 4
What is a characteristic of negotiable instruments similar to money?
They are used for settlement of debt
According to Section 13 of the Negotiable Instrument Act 1881, what is a 'Negotiable Instrument'?
A promissory note, bill of exchange or cheque payable either to order or to bearer
What is the primary characteristic of a holder in due course?
The holder in due course is entitled to sue in his own name against all the prior parties to realize proceeds of the instruments
What is the primary difference between a Promissory Note and a Bill of Exchange?
A Promissory Note has an unconditional undertaking, while a Bill of Exchange has an unconditional order
Who is the person who makes the promise to pay in a Promissory Note?
The maker
What is the primary purpose of a Bill of Exchange?
To provide a means of payment between two parties
What is the primary right of a holder in due course?
The right to sue all the prior parties to realize proceeds of the instruments
What is essential for a banker to open an account?
All of the above
What type of deposits require a fixed period and rate of interest?
Time Deposits
What is necessary for a valid contract when a banker opens an account?
All the essential features of a valid contract
What is typically required for opening each type of account?
Several documents including account opening forms, proof of identity, and verification of address
Who can open an account with a bank?
Any person competent to contract as per Contract Act, 1872
What is the primary purpose of the Trust Deed?
To vest powers in the trustees for administering the trust property
What is the key feature of a trust as per the Trust Act, 1882?
An obligation annexed to the ownership of property
What should a banker examine thoroughly before opening an account in the names of persons in their capacity as trustees?
The Trust Deed
What is the relationship between the trustee and the beneficiary?
The trustee holds the trust property for the benefit of the beneficiary
What is the effect of a trust on the ownership of the trust property?
The ownership of the trust property is held by the trustee
What happens to the credit if the transfer of amount is done in another customer's account internally?
The credit is cancelled and the cheque is returned unpaid
What should be specified in a garnishee order received against a joint account?
All the names of the joint account holders
What happens to the outstanding in a trust account?
It cannot be attached, if the judgment debtor has deposited the money as a trustee
What is the liability of partners in a partnership account?
Jointly and severally liable for the firm's debts
What should be done when a bank has a prior right to set-off and a lien is marked on a Fixed Deposit receipt?
The fact of right off should be intimated to court and order must be vacated
What happens to a cheque received in clearing if the order is received before the stipulated returning time of clearing?
The cheque is returned unpaid
What is the consequence of a bank having a prior right to set-off?
The bank is not bound by the garnishee order
What should be done when a garnishee order is received against a joint account and mentions only one of the joint account holders?
Reference should be made to the Head Office seeking their instructions
What is the status of the amount in a trust account?
It is a separate asset, not attachable by the garnishee order
What is the effect of a garnishee order on a joint account?
Only the portion belonging to the judgment debtor is attached
What is the primary purpose of a negotiable instrument?
To settle debts
What does a negotiable instrument literally mean?
A document transferable by delivery
What is the characteristic of a negotiable instrument similar to money?
It can be transferred by delivery or by endorsement and delivery
What does sec-13 of Negotiable Instrument Act 1881 state?
A negotiable instrument is a promissory note, bill of exchange or cheque payable either to order or to bearer
What is the term for the person who draws a bill?
Drawer
What is the primary characteristic of a negotiable instrument?
It is transferable by delivery or by endorsement and delivery
What is a characteristic of a cheque that makes it a popular mode of payment?
The transfer cost is very low and the possibility of loss is minimum
What is a characteristic of a negotiable instrument?
It is transferable from hand to hand by way of negotiation
What is included in the definition of 'material alteration' in relation to a cheque?
Any alteration of the date, the sum, or any other material detail
What is the primary function of a cheque?
To facilitate money transactions
Who is the person to whom the amount of a cheque is payable?
Payee
What is a characteristic that makes a cheque a commercial and safe method of money transaction?
Low transfer cost and low possibility of loss
What is a characteristic of a holder in due course?
He can sue in his own name against all the prior parties.
What is the main characteristic of a Promissory Note?
It contains an unconditional undertaking.
What is the primary characteristic of a Bill of Exchange?
It contains an unconditional order.
What is the effect of a defective title of the transferor on the transferee's title if the transferee can prove himself as a holder in due course?
The transferee's title is not affected.
Who is the person who gets the money in a Bill of Exchange?
The bearer of the instrument.
What is the relationship between the maker and the payee in a Promissory Note?
The maker is the debtor, and the payee is the creditor.
What type of instruments are mainly discussed in Chapter 4 of the manual?
Negotiable Instruments
What are the features of Negotiable Instruments discussed in the manual?
Features and characteristics
What is the main topic of Chapter 4 in the manual?
Negotiable Instruments
What aspects of banking are covered in the manual?
General banking activities, risk issues, and capacity development
How many chapters are there in the manual?
12 chapters
What is discussed in Chapter 5 of the manual?
Clearing and Collection of Instruments
What is the primary characteristic of a time deposit?
It has a fixed period and rate of interest
What is required to open an account with a bank?
A valid ID, proof of address, a specimen signature card, a KYC form, and a photograph
What is the purpose of a Know Your Customer (KYC) form?
To verify the customer's identity
What type of documents are required to open a deposit account?
A valid ID, proof of address, a specimen signature card, a KYC form, and other necessary documents
What is the relationship between the banker and the customer when opening a deposit account?
A contractual relationship
What is the primary characteristic of a fixed deposit?
It has a fixed period and rate of interest
What is the primary function of deposit mobilization in banking?
To fund the bank's business operations
What is the main source of funds for banks?
Deposits from retail and corporate customers
What type of deposits have a fixed period and rate of interest?
Fixed Deposits
Why are banks introducing several deposit schemes?
To reduce dependence on urban deposits
What is a necessary document for opening a deposit account?
All of the above
What is being placed into a banking institution for safekeeping?
Money
What is the primary purpose of banks opening branches across the country?
To reduce dependence on urban deposits
Who can open an account with the bank?
Any person competent to contract
What is a necessary element in a valid contract for opening a deposit account?
All the essential features of a valid contract
What type of deposits may have a large portion of savings deposits?
Time Deposits
Who can open a Savings Bank account?
Adult individuals, jointly, illiterate persons, and minors after observing certain formalities
What is the limit of withdrawals allowed per week from a Savings Bank account?
Twice a week
What is the minimum balance required to maintain in a Savings Bank account to earn interest?
Tk. 500
What is the frequency of interest payment on a Savings Bank account?
Half-yearly on June and December
What is one of the customer benefits of having a Savings Bank account?
Wide network of branches and utility payment services
What happens when a cheque is presented for payment in a dormant account?
It is referred to the Manager/Authorized Officer of the account Branch.
How is an account reactivated after being dormant?
By the customer initiating a debit to the account.
What happens to an account when the account holder passes away?
The account is stopped and termed 'deceased account'.
How is interest applied to a deceased account?
It is paid up to the date of withdrawal or closing.
Who is responsible for verifying the genuineness of a cheque presented in a dormant account?
The Manager/Authorized Officer of the account Branch.
What documents are required to open a bank account?
Account Opening Form, Specimen Signature Card, and Mandate
What is the purpose of KYC standards in banking?
To reduce money laundering and terrorist financing
What is the purpose of a Mandate in banking?
To authorize persons to operate the account
Why is it important to obtain identification documents from customers?
To verify customer identity
What does KYC refer to in banking?
Knowing a customer physically and financially
What is required to obtain from the account holder to ensure they do not operate the account unless they personally come to the bank?
A letter of undertaking
What should be obtained from the introducer when opening an account for a person who cannot sign?
An attested thumb impression
What should be recorded by the Manager/Sub-Manager on the back of the cheque?
A certificate to this effect
What is required to be obtained when opening an account for a local authority or municipal corporation?
A copy of the status or any other law by which the body was created and is governed
What should be taken to see that no cheque bearing thumb impression and presented through clearing is paid by the Branch?
Precautionary measures
What happens to interest in a term deposit account when it is withdrawn prematurely?
It is paid at the rate applicable for the relevant TDR
What is the purpose of nominating a person in a bank deposit account?
To receive the benefit in case of death of the account holder
How many nominees can be appointed to a bank deposit account?
One or more
What is the interest rate applicable for the period beyond maturity in a term deposit account?
Rate applicable for Savings Bank Accounts
What is the status of a term deposit account when it is withdrawn after maturity?
Encashment beyond maturity
Who can appoint a nominee to a bank deposit account?
Account holders with individual or joint names
What is the interest rate applicable for a term deposit account up to the date of maturity?
Rate applicable for the relevant TDR
What happens when a term deposit account is withdrawn before maturity?
Penal interest is recovered
What is the role of a nominee in a bank deposit account?
To receive the benefit in case of death of the account holder
What is the consequence of premature encashment of a term deposit account?
Penal interest is recovered and interest is paid up to the date of withdrawal
What is the primary concern of banks in terms of malpractices?
Fraud and money laundering
What measures have been taken to address the challenge of malpractices in general banking?
Increased stringent compliance requirements
Why are banks considered more fragile than non-financial organizations?
Due to malpractices and non-compliance
What is a critical challenge of general banking?
Malpractices and fraudulent activities
What should receive adequate attention from policy makers in general banking?
All associated risks of general banking
What is a crucial aspect of general banking that senior management should possess?
Skills on risk management and capacity development
What is the primary function of the General Banking Department?
To serve as the direct customer service center
Why is capacity development of bank officials crucial in general banking?
To minimize risks in general banking
What is the significance of having specialized people in general banking?
To facilitate general banking effectively
What is the role of senior bankers in general banking?
To guide desk level bank officials
Which Act is relevant to partnerships in the context of general banking?
The Partnership Act, 1932
Which Act is relevant to the creation of a trust in the context of general banking?
The Trust Act, 1882
Which section of the Negotiable Instrument Act 1881 deals with MATERIAL ALTERATION?
Sec-13
What is the main theme of Chapter 10 in the manual?
Laws and Regulations related to General Banking
What is the primary responsibility of a bank towards its customers?
To protect customers' deposit and secrecy
What is the characteristic of a banker-customer relationship?
Based on trust and good faith
Which Act is relevant to the creation of a company in the context of general banking?
The Companies Act, 1994
What is the supreme responsibility of a bank?
To protect customers' deposit and secrecy
What is the significance of commercial banks in economic development?
They are necessary for the development of the whole banking system
What is the role of a bank in the economy?
A financial intermediary
What is the main focus of Chapter 4 in the manual?
Negotiable Instruments
What is discussed in Chapter 5 of the manual?
Clearing and Collection of Instruments: BACH, BACPS, Cash and vault managements
What is covered in Chapter 6 of the manual?
Bills Collection and Remittance
What is the target audience of the manual?
Relatively senior level bank executives
How many chapters are in the manual?
12
What is the primary function of commercial banks?
Mobilize deposits to productive fields
What is the role of the General Banking department?
To link with all other departments
Why is it important for bank employees to keep themselves updated with new skills and knowledge?
To handle customer queries effectively
What is the current trend in the banking industry?
Banks are transforming themselves with a focus on knowledge
What is the importance of general banking in the economy?
It helps to activate the entire economic sector
What is the primary objective of Customer Due Diligence (CDD)?
To understand who the customers are
What is the purpose of Enhanced Due Diligence (EDD)?
To monitor high-risk customers
What is the main purpose of the MLPA, 2012?
To prevent money laundering
What is the main purpose of the ATA, 2009?
To prevent terrorist financing
What should banks consider when implementing CDD measures?
All of the above
What is the primary objective of Customer Know Your Customer (KYC) procedure?
To verify customer identity
What is the purpose of CDD obligations under legislation and regulation?
To prevent money laundering
What should banks do to demonstrate compliance with CDD measures?
Put in place risk-sensitive CDD measures
What is the primary purpose of transaction monitoring?
To detect suspicious transactions
What should banks consider when implementing risk-sensitive CDD measures?
All of the above
Which department is considered as the direct customer service center in a bank?
General Banking Department
What is crucial in general banking alongside ensuring customer satisfaction?
Efficiency level of the bankers with due compliance of the laws and procedures
What is essential for banks to minimize risks in general banking and establish credibility?
Specialized people with adequate knowledge base and skills
Why is capacity development of bank officials important in general banking?
To ensure compliance with laws and regulations
What is essential for guiding desk-level bank officials in general banking?
A group of senior bankers with adequate knowledge and skills
What is the primary focus of Chapter 10 of the manual?
Laws and Regulations Related to General Banking
What is the characteristic of a banker-customer relationship?
Fiduciary
What is the significance of commercial banks in economic development?
They act as financial intermediaries
What is the role of a bank in protecting customers' deposits?
To protect secrecy and maintain utmost good faith
What is the key aspect of a bank's dealings with customers?
Impartiality and non-discrimination
What is a crucial aspect of general banking that senior management should possess?
Ability to manage different areas of general banking
What is a major challenge faced by general banking institutions?
Malpractices and fraudulent activities
Why are banks considered more fragile than non-financial organizations?
Because they are widely perceived to be more fragile
What has been done to handle the challenges of malpractices and fraud in general banking?
Implementing stricter compliance requirements
What should receive adequate attention from policy makers in general banking?
All associated risks of general banking
Which Act of 1991 is relevant to general banking in Bangladesh?
The Bank Companies Act, 1991
Which section of the Contract Act, 1872 is relevant to general banking?
Section 13
What is discussed in Chapter 10 of the manual?
Laws and Regulations related to General Banking
Which Act of 1872 is relevant to contracts in general banking?
The Contract Act, 1872
Which Act of 1932 is relevant to partnerships in general banking?
The Partnership Act, 1932
Which Act is relevant to negotiable instruments in general banking?
Negotiable Instrument Act 1881
What is the significance of material alteration in relation to a cheque?
It makes the cheque invalid
What is the primary purpose of Know Your Customer (KYC) form?
To verify customer identity
Which section of the Negotiable Instrument Act 1881 deals with material alteration?
Section 138
What is the primary right of a holder in due course?
To sue the drawer of the cheque
What is the primary function of commercial banks in the economy?
To mobilize deposits to the productive fields to activate the entire economic sector
What is the significance of the General Banking department in a financial institution?
It is linked to all other departments and is a vital part of the institution
What is the need for today's bank employees in the context of the rapidly changing world of banking and finance?
To continually seek new skills and knowledge to respond to change
Why is it important for banks to encourage saving?
To promote economic growth and development
What is the current trend in the banking sector in Bangladesh?
Banks are facing increasing competition
What is the primary purpose of Customer Due Diligence (CDD)?
To verify the identity of customers
What is the main objective of the Anti-Terrorism Act (ATA), 2009?
To prevent terrorist financing
What is the purpose of Enhanced Due Diligence (EDD)?
To monitor high-risk customers
What is the main focus of the Money Laundering Prevention Act (MLPA), 2012?
To prevent money laundering
What should banks consider when implementing risk-sensitive CDD measures?
All of the above
What is the primary benefit of implementing CDD measures?
To prevent money laundering
What is the role of banks in preventing money laundering and terrorist financing?
To prevent money laundering and terrorist financing
What is the primary purpose of transaction monitoring?
To identify suspicious transactions
What is the main focus of risk-sensitive CDD measures?
To consider the risk of money laundering and terrorist financing
What is the primary benefit of knowing your customer?
To build a strong customer-bank relationship
Test your knowledge on banker's responsibilities, types of accounts, and negotiable instruments. This quiz covers topics related to banking operations, including dormant and unclaimed deposit accounts, payment to heirs of the deceased, and more.
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