Question

    According to the revised RBI instructions, when must a Tier 1 Urban Co-operative Bank seek RBI’s prior approval to grant unsecured advances?

    A When their CRAR is less than 9% Correct Answer Incorrect Answer
    B When unsecured advances exceed 10% of total assets Correct Answer Incorrect Answer
    C When their gross NPAs exceed 7% Correct Answer Incorrect Answer
    D When the advance is for priority sector loans Correct Answer Incorrect Answer
    E When unsecured advances exceed ₹50 lakh Correct Answer Incorrect Answer

    Solution

    The "Master Circular – Exposure Norms and Statutory Restrictions for UCBs" specifies that UCBs must seek RBI approval when unsecured advances exceed 10% of their total assets.

    Practice Next