NMIMS COMMERCIAL BANKING

Commercial banking system and role of RBI

1. Sundarajan Pvt.Ltd., Bangalore based company are engaged in exporting sea food to various countries. They entered in a contract with Japanese Company, Ziomei Pvt Limited for the exporting cuttle fish. Ziomei Pvt Limited asked XYZ Limited to issue the letter of credit. Sundarajan &lsquos owner doesn&rsquot have much idea on letter of credit. He visits the bank to get an idea of how the letter of credit works. As a bank manager, you are required to explain him the procedure of how letter of credit works as its advantages from buyer&rsquos as well as seller&rsquos point of view.

2. You are an operational trainer in a bank. You are asked to prepare a presentation on the various types of fund based credit facility of a bank. Describe the same.

3. The Basel Accords primarily focuses on prudential norms for bank capital under the aegis of which banks are required to ensure adequate capital to cover losses on account of significant risks in their business. In regard to the above statement answer the below questions.

a. Elaborate on Basel I, Basel II, Basel III.

b. Highlight the significance of Basel III in context to Indian banks