BANKING GENERAL KNOWLEDGE
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Which of the following statements about UCBs undertaking insurance business is/are correct?
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No UCB should undertake insurance agency business without obtaining its prior permission
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The Reserve Bank has allowed all primary (Urban) co-operative banks to undertake insurance business on a referral basis, without any risk participation through their network of branches
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The banks need not obtain prior approval of the Reserve Bank to undertake referral business
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None of the above
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Explanation:
Detailed explanation-1: -Tier-I includes state cooperative banks (SCBs) at the state level; Tier-II includes central cooperative banks (CCBs) at the district level; and Tier-III includes primary agricultural credit societies (PACSs).
Detailed explanation-2: -(iii) The prudential exposure limits for UCBs for a single borrower/party and a group of connected borrowers/parties shall be 15 per cent and 25 per cent, respectively, of their tier-I capital.
Detailed explanation-3: -While overseeing the activities of 1926 primary (urban) cooperative banks, the Urban Banks Department performs three main functions : regulatory, supervisory and developmental. The Department performs these functions through its 17 regional offices.
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