Banking Interview Questions and Answers

Q1. What is Bank? What are the types of banks?
Banking is a business of accepting deposits and lending money. It is carried out by financial intermediaries, which performs the functions of safeguarding deposits and providing loans to the public.
In other words, Banking means accepting for the purpose of lending or investment of deposits of money from public repayable on demand and can be withdrawn by cheque, draft order and so on.
The types are: 1. Commercial Banks 2. Central Banks 3. Foreign Exchange Banks 4. Industrial Banks 5. Saving Banks 6. Agricultural Banks 7. The Indigenous Banks 8. International Banks 9. Exim Banks 10. Miscellaneous Banks.

Q2. Your CV demonstrates a variety of skills so why banking?
Banking is a very competitive industry, and more graduates apply than there are jobs. Therefore, you must have clear motivations, not only for the Banking industry, but also for the business area/role you are applying to. You should agree that you do have a variety of skills and experiences, as this is beneficial, but then demonstrate the key skills for the role that you are applying to. For example, for a front office sales role you should highlight any customer/client facing experiences or sales experience you have. For a research role, you should highlight any analytical or problem solving experience you have developed.

Q3. you are given a 3-gallon jug and a 5-gallon jug. How do you use them to get 4 gallons of liquid?
Fill the 5-gallon jug completely.  Pour the contents of the 5-gallon jug into the 3-gallon jug, leaving 2 gallons of liquid in the 5-gallon jug.  Next, dump out the contents of the 3-gallon jug and pour the contents of the 5-gallon jug into the 3-gallon jug.  At this point, there are 2 gallons in the 3-gallon jug.  Fill up the 5-gallon jug and then pour the contents of the 5-gallon jug into the 3-gallon jug until the 3-gallon jug is full.  You will have poured 1 gallon, leaving 4 gallons in the 5-gallon jug.

Q4. What are the types of Commercial Banks in India ?
Commercial Banks in India are of the following  types:

1. Public Sector Banks
2. Private Sector Banks
3. Foreign Banks

Q5. What attracts you to a career in banking?
Banking is a fast-paced, constantly evolving industry that drives most major economies around the world. You need to demonstrate an understanding and awareness of the important role Banking plays in the wider economy. It helps here if you can refer to a recent news story or economic development that you have read or researched recently.

Q6. How to Open Bank Account in Sole Proprietary Firm Name
In case of opening an account in the name of a sole proprietary firm, a certified copy of an OVD as mentioned above with any two of the following documents as a proof of business/activity in the name of the proprietary firm must be submitted.

• Registration Certificate
• Shop and Establishment Act License.
• VAT returns or Income tax returns.
• CST/VAT Certificate.
• VAT Registration or Service Tax Registration or Professional Tax Registration.
• Certificate of Practice issued by any professional body incorporated under a statute.
• Complete Income Tax Return (not just the acknowledgement) in the name of the sole proprietor where the firm’s income is reflected, duly authenticated/acknowledged by the Income Tax authorities.
• Utility bills such as electricity, water, and landline telephone bills.

In some cases where two documents cannot be provided, the bank may open an account in proprietary firm name with only one document. However, in such cases, a bank officer must undertake point verification and collect information to establish the existence of a proprietary firm at the address provided.

Q7. What kind of lifestyle do you expect to have in banking?
Explain that you expect the work to be hard, potentially accompanied by long hours. It is also likely that you will receive a high salary and other non-financial rewards, so the hard-work will be worthwhile. You need to demonstrate the eagerness to be involved in this industry, and the dedication to work hard for long hours. Many banks are also aware of how some members of the wider population perceive them, especially since the financial crisis. You may be asked questions relating to this as well.

Q8. Tell me about a recent development at this bank?
For this question, you need to have researched the bank that you are applying to. There are plenty of online resources that might outline a recent deal/transaction, or an operational change the bank has recently completed. You should be able to speak about, and demonstrate your understanding of this recent activity. Your examples should be as close to the business area that you are applying to as possible.

Q9. What is Objectives of Exchange Control in India?
The primary objective of exchange control in India is to regulate the demand for foreign exchange for various purposes against the supply constraints. When the Government finds a shortage of foreign exchange due to the low level of external reserves on account of deficit in the balance of payments, exchange control becomes necessary.

Q10. What is the angle between the hour-hand and minute-hand of a clock at 3:15?
At quarter past the hour, the minute-hand is exactly at 3:00 but the hour-hand has moved 1/4 of the way between 3:00 and 4:00.  Therefore 1/4 times 1/12 = 1/48 of the clock.  With the clock having 360 degrees, 360/48 = 7.5 degrees.

Q11. What would you be doing if you weren’t in banking?
This question might be used by interviewers for two reasons. The first is to see if you are truly committed to a career in Banking, and your answer should demonstrate that you are fully committed, and with tangible reasons why. The second reason is to ensure you are pursuing a career in banking for the right reasons, and that you are suitable. Mention that, if you couldn’t work in Banking, you would choose a similar role that requires similar skills and experience.

Q12. What is Composition of Central Board
The Central Board consists of Governor, deputy Gove rnor, Ten Director nominated by the Central Government and two Government official nominated by the Central Government. The deputy Governor and Director are eligible to attend meeting of the Central Board but are not entitled to vote. The Governor and deputy Governor hold office for term of five years and are entitled for a re – appointment. The Directors are appointed for a term of four and hold office during the pleasure of the president. The meeting of the Central Board is convened at least six times in a year.

Q13. Who’s our major competitor? How do we measure up?
Know the bank that you are applying to and look at their competition. Make it explicit that you are aware of recent developments in each. You should also research the core values of the bank you are applying to, and align these to your own personal goals, explaining that this is the reason for your application.

Q14. What is the sum of numbers from 1 to 100?
The trick here is that you have 50 pairs which each sum to 101 (e.g. 1+100, 2+99, 3+98, etc.).  So, 50 times 101 = 5050.

Q15. What are the risks and opportunities we face in the banking sector?
This answer should be tailored to the area of Banking you are applying to. Quite often, a risk can lead to an opportunity and vice-versa. This is a good opportunity for you to demonstrate your market knowledge, and the more recent developments you can discuss, the better.