Clerk & PO : Important Quiz for Bank Part-09
Debit Card: A plastic card issued by banks to
customers to withdraw money electronically
from their accounts. When you purchase things
on the basis of Debit Card the amount due is
debited immediately to the account. Many
banks issue Debit-Cum-ATM Cards.
Debtor: A person who takes some money on
loan from another person.
Demand Deposits: Deposits which are
withdrawn on demand by customers. E.g.
savings bank and current account deposits.
Demat Account: Demat Account concept has
revolutionized the capital market of India.
When a depository company takes paper shares
from an investor and converts them in
electronic form through the concerned
company, it is called Dematerialization of
Shares. These converted Share Certificates in
Electronic form are kept in a Demat Account
by the Depository Company, like a bank keeps
money in a deposit account. Investor can
withdraw the shares or purchase more shares
through this demat Account.
Derivative Call (Put) Warrants: Warrants
issued by a third party which grant the holder
the right to buy (sell) the shares of a listed
company at a specified price.
Derivative Instrument: Financial instrument
whose value depends on the value of another
asset.
Discount Bond: A bond selling below par, as
interest in-lieu to the bondholders.
Dishonour of Cheque: Non-payment of a
cheque by the paying banker with a return
memo giving reasons for the non-payment.
Default Risk: The possibility that a bond issuer
will default ie, fail to repay principal and
interest in a timely manner.
Diversification: The inclusion of a number of
different investment vehicles in a portfolio in
order to increase returns or be exposed to less
risk.
Duration: A measure of bond price volatility,
it captures both price and reinvestment risks
to indicate how a bond will react to different
interest rate environments.
Earnings: The total profits of a company after
taxation and interest.
Earnings per Share (EPS): The amount of
annual earnings available to common
stockholders as stated on a per share basis.
Earnings Yield: The ratio of earnings to price
(E/P). The reciprocal is price earnings ratio (P/
E).
E-Banking : E-Banking or electronic banking is
a form of banking where funds are transferred
through exchange of electronic signals between
banks and financial institution and customers
ATMs, Credit Cards, Debit Cards, International
Cards, Internet Banking and new fund transfer
devices like SWIFT, RTGS belong to this
category.
EFT - (Electronic Fund Transfer): EFT is a
device to facilitate automatic transmission and
processing of messages as well as funds from
one bank branch to another bank branch and
even from one branch of a bank to a branch of
another bank. EFT allows transfer of funds
electronically with debit and credit to relative
accounts.
Either or Survivor: Refers to operation of the
account opened in two names with a bank. It
means that any one of the account holders
have powers to withdraw money from the
account, issue cheques, give stop payment
instructions etc. In the event of death of one
of the account holder, the surviving account
holder gets all the powers of operation.
Electronic Commerce (E-Commerce): E-
Commerce is the paperless commerce where
the exchange of business takes place by
Electronic means.
Endorsement: When a Negotiable Instrument
contains, on the back of the instrument an
endorsement, signed by the holder or payee of
an order instrument, transferring the title to
the other person, it is called endorsement.
Bouncing of a cheque: Where the name of
the endorsee or transferee is not mentioned
on the instrument.
Endorsement in Full: Where the name of the
endorsee or transferee appears on the
instrument while making endorsement.
Equity: Ownership of the company in the form
of shares of common stock.
Equity Call Warrants: Warrants issued by a
company which give the holder the right to
acquire new shares in that company at a
specified price and for a specified period of
time.
Ex-dividend (XD): A security which no longer
carries the right to the most recently declared
dividend or the period of time between the
announcement of the dividend and the
payment (usually two days before the record
date). For transactions during the ex-dividend
period, the seller will receive the dividend, not
the buyer. Ex-dividend status is usually
indicated in newspapers with an (x) next to the
stock’s or unit trust’s name.
Execution of Documents: Execution of
documents is done by putting signature of the
person, or affixing his thumb impression or
putting signature with stamp or affixing
common seal of the company on the
documents with or without signatures of
directors as per articles of association of the
company.
Face Value/ Nominal Value: The value of a
financial instrument as stated on the
instrument. Interest is calculated on face/
nominal value.
Fixed-income Securities: Investment vehicles
that offer a fixed periodic return.
Fixed Rate Bonds: Bonds bearing fixed
interest payments until maturity date.
Floating Rate Bonds: Bonds bearing interest
payments that are tied to current interest
rates.
Factoring: Business of buying trade debts at a
discount and making a profit when debt is
realized and also taking over collection of
trade debts at agreed prices.
Foreign Banks: Banks incorporated outside
India but operating in India and regulated by
the Reserve Bank of India (RBI),. e..g.,
Barclays Bank, HSBC, Citibank, Standard
Chartered Bank, etc.
Forfeiting: In International Trade when an
exporter finds it difficult to realize money
from the importer, he sells the right to receive
money at a discount to a forfaiter, who
undertakes inherent political and commercial
risks to finance the exporter, of course with
assumption of a profit in the venture.
Forgery: when a material alteration is made
on a document or a Negotiable Instrument like
a cheque, to change the mandate of the
drawer, with intention to defraud.
Fundamental Analysis: Research to predict
stock value that focuses on such determinants
as earnings and dividends prospects,
expectations for future interest rates and risk
evaluation of the firm.
Future Value: The amount to which a current
deposit will grow over a period of time when it
is placed in an account paying compound
interest.
Future Value of an Annuity: The amount to
which a stream of equal cash flows that occur
in equal intervals will grow over a period of
time when it is placed in an account paying
compound interest.
Futures Contract: A commitment to deliver a
certain amount of some specified item at some
specified date in the future.
customers to withdraw money electronically
from their accounts. When you purchase things
on the basis of Debit Card the amount due is
debited immediately to the account. Many
banks issue Debit-Cum-ATM Cards.
Debtor: A person who takes some money on
loan from another person.
Demand Deposits: Deposits which are
withdrawn on demand by customers. E.g.
savings bank and current account deposits.
Demat Account: Demat Account concept has
revolutionized the capital market of India.
When a depository company takes paper shares
from an investor and converts them in
electronic form through the concerned
company, it is called Dematerialization of
Shares. These converted Share Certificates in
Electronic form are kept in a Demat Account
by the Depository Company, like a bank keeps
money in a deposit account. Investor can
withdraw the shares or purchase more shares
through this demat Account.
Derivative Call (Put) Warrants: Warrants
issued by a third party which grant the holder
the right to buy (sell) the shares of a listed
company at a specified price.
Derivative Instrument: Financial instrument
whose value depends on the value of another
asset.
Discount Bond: A bond selling below par, as
interest in-lieu to the bondholders.
Dishonour of Cheque: Non-payment of a
cheque by the paying banker with a return
memo giving reasons for the non-payment.
Default Risk: The possibility that a bond issuer
will default ie, fail to repay principal and
interest in a timely manner.
Diversification: The inclusion of a number of
different investment vehicles in a portfolio in
order to increase returns or be exposed to less
risk.
Duration: A measure of bond price volatility,
it captures both price and reinvestment risks
to indicate how a bond will react to different
interest rate environments.
Earnings: The total profits of a company after
taxation and interest.
Earnings per Share (EPS): The amount of
annual earnings available to common
stockholders as stated on a per share basis.
Earnings Yield: The ratio of earnings to price
(E/P). The reciprocal is price earnings ratio (P/
E).
E-Banking : E-Banking or electronic banking is
a form of banking where funds are transferred
through exchange of electronic signals between
banks and financial institution and customers
ATMs, Credit Cards, Debit Cards, International
Cards, Internet Banking and new fund transfer
devices like SWIFT, RTGS belong to this
category.
EFT - (Electronic Fund Transfer): EFT is a
device to facilitate automatic transmission and
processing of messages as well as funds from
one bank branch to another bank branch and
even from one branch of a bank to a branch of
another bank. EFT allows transfer of funds
electronically with debit and credit to relative
accounts.
Either or Survivor: Refers to operation of the
account opened in two names with a bank. It
means that any one of the account holders
have powers to withdraw money from the
account, issue cheques, give stop payment
instructions etc. In the event of death of one
of the account holder, the surviving account
holder gets all the powers of operation.
Electronic Commerce (E-Commerce): E-
Commerce is the paperless commerce where
the exchange of business takes place by
Electronic means.
Endorsement: When a Negotiable Instrument
contains, on the back of the instrument an
endorsement, signed by the holder or payee of
an order instrument, transferring the title to
the other person, it is called endorsement.
Bouncing of a cheque: Where the name of
the endorsee or transferee is not mentioned
on the instrument.
Endorsement in Full: Where the name of the
endorsee or transferee appears on the
instrument while making endorsement.
Equity: Ownership of the company in the form
of shares of common stock.
Equity Call Warrants: Warrants issued by a
company which give the holder the right to
acquire new shares in that company at a
specified price and for a specified period of
time.
Ex-dividend (XD): A security which no longer
carries the right to the most recently declared
dividend or the period of time between the
announcement of the dividend and the
payment (usually two days before the record
date). For transactions during the ex-dividend
period, the seller will receive the dividend, not
the buyer. Ex-dividend status is usually
indicated in newspapers with an (x) next to the
stock’s or unit trust’s name.
Execution of Documents: Execution of
documents is done by putting signature of the
person, or affixing his thumb impression or
putting signature with stamp or affixing
common seal of the company on the
documents with or without signatures of
directors as per articles of association of the
company.
Face Value/ Nominal Value: The value of a
financial instrument as stated on the
instrument. Interest is calculated on face/
nominal value.
Fixed-income Securities: Investment vehicles
that offer a fixed periodic return.
Fixed Rate Bonds: Bonds bearing fixed
interest payments until maturity date.
Floating Rate Bonds: Bonds bearing interest
payments that are tied to current interest
rates.
Factoring: Business of buying trade debts at a
discount and making a profit when debt is
realized and also taking over collection of
trade debts at agreed prices.
Foreign Banks: Banks incorporated outside
India but operating in India and regulated by
the Reserve Bank of India (RBI),. e..g.,
Barclays Bank, HSBC, Citibank, Standard
Chartered Bank, etc.
Forfeiting: In International Trade when an
exporter finds it difficult to realize money
from the importer, he sells the right to receive
money at a discount to a forfaiter, who
undertakes inherent political and commercial
risks to finance the exporter, of course with
assumption of a profit in the venture.
Forgery: when a material alteration is made
on a document or a Negotiable Instrument like
a cheque, to change the mandate of the
drawer, with intention to defraud.
Fundamental Analysis: Research to predict
stock value that focuses on such determinants
as earnings and dividends prospects,
expectations for future interest rates and risk
evaluation of the firm.
Future Value: The amount to which a current
deposit will grow over a period of time when it
is placed in an account paying compound
interest.
Future Value of an Annuity: The amount to
which a stream of equal cash flows that occur
in equal intervals will grow over a period of
time when it is placed in an account paying
compound interest.
Futures Contract: A commitment to deliver a
certain amount of some specified item at some
specified date in the future.