Commonly asked Bank Interview questions

• What are NPA (Non-Performing Assets),

           Non-Performing Assets are popularly known as NPA. Commercial Banks assets are of various types. All those assets which generate periodical income are called as Performing Assets (PA).

While all those assets which do not generate periodical income are called as Non-Performing Assets (NPA).

If the customers do not repay principal amount and interest for a certain period of time then such loans become non-performing assets (NPA). Thus non-performing assets are basically non-performing loans.

In India, the time frame given for classifying the asset as NPA is 180 days as compared to 45 days to 90 days of international norms. 

• What are the types of NPA

NPA have been divided or classified into following four types:-

    Standard Assets : A standard asset is a performing asset. Standard assets generate continuous income and repayments as and when they fall due. Such assets carry a normal risk and are not NPA in the real sense. So, no special provisions are required for Standard Assets.
    Sub-Standard Assets : All those assets (loans and advances) which are considered as non-performing for a period of 12 months are called as Sub-Standard assets.
    Doubtful Assets : All those assets which are considered as non-performing for period of more than 12 months are called as Doubtful Assets.
    Loss Assets : All those assets which cannot be recovered are called as Loss Assets.

• What are the Causes of NPA

    Speculation : Investing in high risk assets to earn high income.
    Default : Willful default by the borrowers.
    Fraudulent practices : Fraudulent Practices like advancing loans to ineligible persons, advances without security or references, etc.
    Diversion of funds : Most of the funds are diverted for unnecessary expansion and diversion of business.
    Internal reasons : Many internal reasons like inefficient management, inappropriate technology, labour problems, marketing failure, etc. resulting in poor performance of the companies.
    External reasons : External reasons like a recession in the economy, infrastructural problems, price rise, delay in release of sanctioned limits by banks, delays in settlements of payments by government, natural calamities, etc.

• How Can NPA be reduced ?

          By adoptin proper credit evaluation process. There is no one method for reducing the NPA. Multiple strategies should be adopted from the beginning. The first stage is proper credit evaluation process. It should be based on objective evaluation and the project should be economically viable and technically feasible. Only such projects which can generate income and which RBI has permitted should be financed. Once the loan is sanctioned the post followup should be meticulously followed. Regular monitoring of delinquent loans is essential.

• Questions About Budget 2013 - 14 and current five year plan

• Latest Noble Prize Winners, Padam Awards Winners, Miss India, Miss World Miss Universe Etc.

• Governor, Chief Minsiter and Other Ministers of Your State (Like Education, Tourism Ministers )?

• Direct and Indirect Taxes In India

• For unemployed people, which plans are addopted by government ?

• Difference between Fiscal and Moinetary Policy ? 

• What was the Headline in Today's Newspaper?(Main Page and Financial Page Both).

• Where you want to see yourself after 5 Years?

• Your Strengths and Weakness ?

• Number of Districts in Your and Nearby States ?

• Important People of India - Chief of Planning Commission and Election Commission Etc. CM and Governors of All States.

• How is Future growth of commercial banks in India and any hurdles to it ?

• Banks VS NBFCs (Non Banking Finance Companies) ?

• Difference between Cheques, DD, Bill of Exchanges and Certificate of Deposit ?