Categories: Banks

Question 1: Brief me about yourself?

Answer: It is the first fundamental question that every interviewer asks a candidate to start the conversation and know about the person. So, always be positive and introduce yourself starting with your name, qualification and all the other required information that is important for an interviewer to know.  Just complete it within 2 minutes so that it should not be extended as a boring conversation.

Question 2:  Why do you want to join the banking sector?

Answer:  In this question, be logical and answer it by telling why banking sectors have influenced people with all the facts and figures, ready as to why the banking sector is the fastest-growing sector. Do not start by telling them that you want to have a stable career or some personal view.  Just make it well versed which can form a correct opinion of your answer.

Question 3: What are the types of accounts in a bank?

Answer:  Be straight forward and start your answer by telling the information which can match the question asked by an Interviewer.  The types of accounts in banks are:

1. Checking Account:  You can access the account as a savings account but, unlike saving account, you cannot earn interest on this account. The benefit of opening a checking account in a bank is there is no limit for withdrawal.

2. Money Market Account: This account gives both the benefit of savings accounts and checking accounts.  You can withdraw the amount and yet you can earn higher interest on it.  This type of account can be opened with a minimum balance.

3. Certificate of Deposit Account (CD): By the opening of such an account you have to deposit your money for a fixed period like five years or seven years, and you will earn the interest on it. The rate of interest will be decided by the bank, and you cannot withdraw the funds until the fixed period expires.

4. Saving Account: You can save your money in such an account and also earn interest on it. The number of withdrawals is limited and need to maintain the minimum amount balance in the account to remain active.

Question 4: What are the necessary documents a person requires to open an account in a bank?

Answer: As per the RBI advises banks to follow the Know Your Customer (KYC) guidelines where the bank obtains some personal information of the account holder.  The primary documents that are needed to open an account are photographs, proof of identity proof like Aadhar card or Pan Card etc., and address proof as well.

Question 5:  What are the types of Commercial Banks?

Answer: The types of Commercial Banks are:

1. Retail or Consuming Bank: It is small to the midsize branch that directly deals with consumer’s transaction rather than corporate or other banks.

2. Corporate or business banking: Corporate banking deals with cash management, underwriting, financing and issuing of stocks and bonds.

3. Non- traditional Options: There are many non-banks entities that offer financial services like that of the bank. The entities include credit card companies, credit card report agencies and credit card issuers.

4. Securities and Investment Banking: Investment banking manages portfolios of financial assets, commodity and currency, corporate finance, fixed income, debt and equity writing etc.

Question 6:  What is the annual percentage rate (APR)?

Answer:  APR is known as the Annual percentage rate. It is a charge or interest that the bank imposes on their customers for using their services like loans, credit cards etc.  The interest is calculated annually.

Question 7: What is Amortization and negative amortization?

Answer:  Amortization refers to the repayment of the loan by installment to cover principal amount with interest whereas, negative amortization is when the repayment of the loan is less than the loans accumulated interest, then negative amortization takes place.

Question 8:  What is the debt to income ratio?

Answer:  Debt to income ratio is calculated by dividing a loan applicant’s total debt payment by his gross income.

Question 9: What is loan grading?

Answer:  Loan grading is the classification of the loan based on various risks and parameters like repayment risk, borrowers credit history etc.  The system places a loan on one to six categories, based on the stability and risk associated with the loan.

Question 10: What do you mean by Co-Maker?

Answer: A person who signs a note to guarantee the payment of the loan on behalf of the main loan applicant’s is known as Co-maker or sign