Question

    What does first ‘P’ in the security instrument PNCPS, stand for?

    A Participative Correct Answer Incorrect Answer
    B Perpetual Correct Answer Incorrect Answer
    C Preference Correct Answer Incorrect Answer
    D Priority Correct Answer Incorrect Answer
    E Profitable Correct Answer Incorrect Answer

    Solution

    Perpetual Non-Cumulative Preference Shares ( PNCPS ) are a type of preference shares which do not have a redemption date and also do not have a cumulative clause for the dividend. These are treated as part of Tier I capital, as per RBI, for the calculation of capital adequacy of the bank.

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