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    Question

    Which of the following entities are banks prohibited from granting loans or advances to, as per the provisions of Section 20?

    A Directors of the bank Correct Answer Incorrect Answer
    B Firms in which directors hold substantial interest Correct Answer Incorrect Answer
    C Companies where directors hold substantial interest Correct Answer Incorrect Answer
    D Individuals in partnership with directors Correct Answer Incorrect Answer
    E All of the above Correct Answer Incorrect Answer

    Solution

    As per Section 20, banks are prohibited from granting loans or advances to their directors, firms in which directors hold substantial interest, companies where directors hold substantial interest, and individuals in partnership with directors.  

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