CAIIB Treasury Operations: The Complete Revision Sheet
CAIIB treasury operations — this guide gives you the latest 2026 information, key dates, eligibility, fees and study tips for the CAIIB exam.
CAIIB BFM dedicates an entire module to Treasury Operations. Examiners reuse the same eight themes every cycle: the three-office structure, FX rate computation, NDS-OM, the payment rails, derivatives basics, hedging mechanics, ALM, and IFRS 9. Here is the entire framework on one page.
1. The three-office structure
- Front office — dealers, market-making, deal capture. Profit centre.
- Mid office — risk management, limit monitoring, MIS to ALCO. Independent of front and back.
- Back office — settlement, confirmation, reconciliation. Operational.
RBI mandate: the three must be operationally and reporting-wise segregated. A common-reporting structure is the most-asked compliance trap.
2. Forex rate computation — the two formulas
Direct quote: home currency per unit of foreign currency. Example: USD/INR 83.45 means 1 USD = INR 83.45.
Cross rate formula:
EUR/INR = USD/INR ÷ USD/EUR
Bid-ask: customer always buys at the higher ask and sells at the lower bid. A spread question in the exam is solved as ask - bid, expressed in pips (last decimal).
3. NDS-OM, NDS-Call, CCIL
- NDS-OM (Negotiated Dealing System - Order Matching) — anonymous order matching for G-Sec secondary trading. Operated by CCIL.
- NDS-Call — call/notice/term money trading platform. Banks lend / borrow uncollateralised.
- CCIL (Clearing Corporation of India Ltd) — central counterparty for G-Sec, forex, and derivatives. Novation: CCIL becomes buyer to every seller and seller to every buyer.
- TREPS (Triparty Repo) — collateralised borrowing/lending against G-Sec, with CCIL as triparty agent.
4. Payment rails — the four to memorise
| System | Mode | Settlement | Limit |
|---|---|---|---|
| RTGS | Gross (transaction-by-transaction) | Real-time | ₹2 lakh minimum, no upper limit |
| NEFT | Deferred net settlement | Half-hourly batches, 24x7 | No min, no max (per-bank caps apply) |
| IMPS | Real-time | 24x7 | ₹5 lakh |
| UPI | Real-time | 24x7 | ₹1 lakh standard (₹5 lakh for tax, insurance, IPO) |
5. Derivatives — the three you must explain
- Forwards — OTC, customised, settle at maturity. No mark-to-market intra-life.
- Futures — exchange-traded, standardised, daily MTM through the clearing corporation.
- Swaps — exchange of cash flow streams. Most common in India: Overnight Indexed Swap (OIS) on MIBOR.
6. Hedging — netting, matching, and the natural hedge
Three first-line techniques:
- Netting — offset receivables against payables in the same currency.
- Matching — align asset and liability maturities and currencies.
- Natural hedge — an exporter borrowing in foreign currency to offset receivable risk.
7. ALM — the gap analysis basics
- Rate-sensitive assets (RSA) — re-priced within the bucket.
- Rate-sensitive liabilities (RSL) — re-priced within the bucket.
- Gap = RSA - RSL. Positive gap: NII rises when rates rise. Negative gap: NII falls when rates rise.
- RBI buckets: 1 day, 2 to 7 days, 8 to 14 days, 15 to 30 days, 31 days to 3 months, 3 to 6 months, 6 months to 1 year, 1 to 3 years, 3 to 5 years, over 5 years.
8. IFRS 9 / Ind-AS 109 in three lines
Classification: Amortised Cost, Fair Value through OCI, Fair Value through P&L. Impairment: Expected Credit Loss (ECL) model — 12-month ECL for Stage 1, Lifetime ECL for Stages 2 and 3. India: scheduled for implementation in phases; CAIIB still asks the principles.
Common traps
- "NDS-OM is operated by RBI" — false. Operated by CCIL on behalf of RBI.
- "RTGS settles net" — false. Real-time gross settlement, transaction-by-transaction.
- "Mid office reports to front office" — false. Mid reports independently.
- "Futures are OTC" — false. Exchange-traded.
- "Forward rate = spot rate always" — false. Forward = spot + (interest rate differential adjusted).
FAQ
Is treasury a profit centre or a service centre? Front office is a profit centre; mid and back are service / control centres.
What is the difference between OIS and FRA? OIS exchanges fixed for overnight floating index over a period. FRA (Forward Rate Agreement) locks in a future single-period rate today.
Are forward rates always at a premium or discount? Depends on the interest rate differential. INR usually trades at a forward premium against USD because rupee rates exceed dollar rates.
Next step: Treasury reliably contributes 20 to 25 marks in the CAIIB BFM paper. Drill 30 MCQs on rate-sensitive gap and forex maths in our BFM mock and you have banked them.
For more on CAIIB treasury operations, see the official IIBF circulars and our chapter-wise free notes on iibf.store.
For more on CAIIB treasury operations, see the official IIBF circulars and our chapter-wise free notes on iibf.store.
For more on CAIIB treasury operations, see the official IIBF circulars and our chapter-wise free notes on iibf.store.
For more on CAIIB treasury operations, see the official IIBF circulars and our chapter-wise free notes on iibf.store.
Browse the full CAIIB syllabus + free classes to jumpstart your prep.
Practice on our latest mock tests with bilingual explanations and a public leaderboard.
Sharpen recall with the matching games — 60-second drills on dates, schemes and definitions.
Source: Indian Institute of Banking & Finance — iibf.org.in
More on CAIIB treasury operations
Aspirants often ask whether the CAIIB treasury operations question paper is bilingual; yes. Every objective paper on IIBF carries Hindi alongside English so candidates can pick the language they read fastest in. Use this freedom to your advantage — switch to the language you naturally think in when a question is ambiguous.
Another common worry is negative marking. As of 2026, objective papers carry no negative marks, so attempt every question and use elimination on the ones you are unsure about. The case-study section rewards conceptual clarity over rote learning, so spend the first week building first-principles intuition before diving into mock tests.
Coaches who clear IIBF exams in one attempt share the same pattern — split your day into two 90-minute deep-work blocks separated by a brisk walk and a short 10-minute spaced-repetition review. The brain consolidates banking definitions when you sleep on them. Which is why we keep all our notes downloadable as PDFs so you can revise the night before.
Finally, remember that scores under 50 percent are usually a sign of weak time management, not weak knowledge. Use the in-built timer on every mock test on iibf.store. And aim to finish 90 questions in 65 minutes so you have time to mark for review. Once that timing is automatic, accuracy climbs on its own.
For deeper background, read the official notification on iibf.org.in, then come back here for our chapter-wise study plan, mock tests and matching games. We update this guide weekly, so bookmark it.
CAIIB treasury operations aspirants benefit most from spaced practice — three short sessions a day beat one long marathon every time.
Browse the full CAIIB syllabus + free classes to jumpstart your prep.
Practice on our latest mock tests with bilingual explanations and a public leaderboard.
Sharpen recall with the matching games — 60-second drills on dates, schemes and definitions.
Source: Indian Institute of Banking & Finance — iibf.org.in
Browse the full CAIIB syllabus + free classes to jumpstart your prep.
Practice on our latest mock tests with bilingual explanations and a public leaderboard.
Sharpen recall with the matching games — 60-second drills on dates, schemes and definitions.
Source: Indian Institute of Banking & Finance — iibf.org.in
Browse the full CAIIB syllabus + free classes to jumpstart your prep.
Practice on our latest mock tests with bilingual explanations and a public leaderboard.
Sharpen recall with the matching games — 60-second drills on dates, schemes and definitions.
Source: Indian Institute of Banking & Finance — iibf.org.in
Browse the full CAIIB syllabus + free classes to jumpstart your prep.
Practice on our latest mock tests with bilingual explanations and a public leaderboard.
Sharpen recall with the matching games — 60-second drills on dates, schemes and definitions.
Source: Indian Institute of Banking & Finance — iibf.org.in
Browse the full CAIIB syllabus + free classes to jumpstart your prep.
Practice on our latest mock tests with bilingual explanations and a public leaderboard.
Sharpen recall with the matching games — 60-second drills on dates, schemes and definitions.
Source: Indian Institute of Banking & Finance — iibf.org.in
Take a free mock test, download chapter PDFs, or watch a video class — all included on iibf.store.
