JAIIB · RBWM

Case Studies

Chapter notes, video classes, MCQ practice tests and quick-revision one-liners for Retail Banking and Wealth Management — JAIIB.

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Q

What is the primary purpose of case studies in JAIIB Retail Banking and Wealth Management?

A

Case studies help candidates apply theoretical banking concepts to real-world scenarios, testing their ability to analyze customer situations and recommend appropriate retail banking and wealth management solutions.

Q

In a case study, a bank sells a mutual fund to a customer without disclosing risks — what regulatory violation has occurred?

A

Violation of SEBI suitability and disclosure norms for distributors.

Q

In a retail banking case study, a customer has surplus funds and wants to grow wealth with moderate risk — which instrument is most suitable?

A

A balanced mutual fund or a debt fund would be most appropriate, offering moderate returns with lower risk compared to equity funds while being better than a fixed deposit for wealth creation.

Q

What is the maximum loan tenure typically permitted for a retail home loan in India?

A

Up to 30 years depending on borrower age and policy.

Q

What does KYC stand for and why is it mandatory in retail banking?

A

KYC stands for Know Your Customer; it is mandatory under RBI guidelines and the Prevention of Money Laundering Act (PMLA) to verify customer identity, prevent fraud, money laundering, and terrorist financing.

Q

In a wealth management case study, what does 'rebalancing a portfolio' mean?

A

Restoring original asset allocation by buying or selling assets.

Q

A customer approaches a bank for a home loan — what is the key ratio the bank checks to assess repayment capacity?

A

The bank checks the Fixed Obligation to Income Ratio (FOIR), which ensures that the total monthly loan EMIs do not exceed a specified percentage (typically 40–50%) of the customer's net monthly income.

Q

A customer earning Rs.60,000 monthly applies for a home loan — what is the generally accepted EMI-to-income ratio?

A

EMI should not exceed 40-50% of monthly net income.

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