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    Question

    What is the necessary requirement for granting loans and advances to relatives of Directors?

    A Approval from the Reserve Bank of India Correct Answer Incorrect Answer
    B Approval from the Department of Banking Regulation Correct Answer Incorrect Answer
    C Approval from the Board of Directors Correct Answer Incorrect Answer
    D Approval from the shareholders of the banking company Correct Answer Incorrect Answer
    E None of the above Correct Answer Incorrect Answer

    Solution

    As per RBI Circular loans and advances to relatives of the bank's Chairman/Managing Director or other Directors, as well as Directors of other banks and their relatives, Directors of Scheduled Co-operative Banks and their relatives, and Directors of Subsidiaries/Trustees of Mutual Funds/Venture Capital Funds set up by the financing banks or other banks, require prior approval from the Board.

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