ECONOMICS
FEDERAL RESERVE
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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the Federal Open Market Committee
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the Department of the Treasury
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Member Banks
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None of the above
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Detailed explanation-1: -Banks in India hold around 15% as cash with themselves and with the RBI. This cash deposit is known as ‘reserve’. This helps to ensure that there is money available to the people even if there are large spendings by the bank.
Detailed explanation-2: -Branch banking is a system of providing banking services through different offices of a bank that acts as the head branch. The idea is to expand the bank’s business to cater to different locations and provide services to all its customers.
Detailed explanation-3: -Without visibility into the governance of a respondent bank’s clients for whom it does business, correspondent banks are prone to abuse. The repercussions can be severe and include large regulatory or criminal, sanctions, reputational and financial damage. There are many big litigation cases before Courts.
Detailed explanation-4: -Key Takeaways. Chain banking is a form of bank governance in which individuals or an entity takes control of, at least, three banks that are independently chartered. It is not like branch banking or group banking because banks within such a system are separately-owned and are not part of the same entity.