CONTROL OVER ORGANISATION OF BANKS QUESTIONS
Chapter notes, video classes, MCQ practice tests and quick-revision one-liners for Banking Regulations and Business Laws — CAIIB.
One-liners from this chapter
Free sample — 8 of 65 rapid-fire Q&A cards.
Under which section of the Banking Regulation Act, 1949 does the RBI have the power to give directions to banks regarding their business operations?
Section 35A of the Banking Regulation Act, 1949 empowers RBI to issue directions to banking companies in the public interest, in the interest of depositors, or for sound and proper management of banking companies.
Which section of the Banking Regulation Act, 1949 empowers RBI to issue guidelines on corporate governance of banks?
Section 35A empowers RBI to issue binding directions.
What is the minimum paid-up capital requirement for a new private sector bank as per RBI licensing guidelines?
The minimum initial paid-up voting equity capital for a new private sector bank is Rs. 500 crore. The promoters must contribute at least 40% of the paid-up voting equity capital at the time of commencement of business.
What is the maximum number of directors permitted on the Board of a banking company under the Banking Regulation Act, 1949?
Maximum 15 directors are permitted on the Board.
Which section of the Banking Regulation Act, 1949 deals with the requirement of obtaining a licence before commencing banking business?
Section 22 of the Banking Regulation Act, 1949 mandates that no company shall carry on banking business in India unless it holds a licence issued by the Reserve Bank of India.
What does Section 12 of the Banking Regulation Act, 1949 deal with regarding share capital?
It regulates voting rights proportional to paid-up share capital.
What does Section 10 of the Banking Regulation Act, 1949 specify regarding the management of banking companies?
Section 10 prohibits a banking company from employing or being managed by any person who is, or at any time has been, adjudicated insolvent, or has suspended payment to creditors, or has made a composition with creditors, or has been convicted of a moral turpitude offence.
Under which section of the Banking Regulation Act can RBI appoint additional directors on the Board of a bank?
Section 36AB allows RBI to appoint additional directors.
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