PNB LBO key terms

The interest rate at which the Reserve Bank of India lends short-term funds to commercial banks against government securities. Raising it typically cools inflation by making borrowing costlier across the economy.

The rate at which the RBI absorbs surplus liquidity from banks by borrowing their funds. It usually sits below the repo rate and is used to drain excess cash from the banking system.

Cash Reserve Ratio: the share of net demand and time liabilities that scheduled banks must hold as cash with the RBI. It earns no interest and directly reduces the funds available for lending.

Statutory Liquidity Ratio: the minimum portion of net demand and time liabilities a bank must keep in cash, gold, or approved government securities. Unlike CRR, these assets are held by the bank itself.

The central bank's use of tools such as policy rates, reserve ratios, and open market operations to manage money supply, credit availability, inflation, and currency stability. In India it is framed by the Monetary Policy Committee.

The RBI's window through which banks borrow against government securities at the repo rate or park surplus funds at the reverse repo rate, keeping short-term liquidity and overnight rates near the policy target.

Buying or selling of government securities by the central bank in the secondary market to inject or absorb durable liquidity. Purchases add cash to the system; sales mop it up.

Debt instruments issued by the central or state government to borrow money, paying periodic interest and principal on maturity. Banks hold them to meet SLR and as collateral for central bank borrowing.

A framework where the central bank commits to a numeric inflation goal and uses policy rates to hit it. India's flexible target is four percent consumer inflation with a two-percentage-point tolerance band.

A retail price index tracking the cost of a fixed basket of goods and services bought by households. It is India's headline inflation measure and the anchor for monetary policy decisions.

An index measuring price changes at the wholesale or producer level, covering manufactured goods, fuel, and primary articles. It excludes services and is not the RBI's policy anchor.

A loan on which interest or principal has remained overdue for more than ninety days. Banks must classify such accounts, provide for expected losses, and follow RBI recovery and resolution rules.

Money a bank sets aside from profit to cover loans or assets that may not be recovered in full. Higher provisioning reduces reported profit and capital, so asset quality directly affects earnings.

A bank's capital expressed as a percentage of its risk-weighted assets, showing how much loss-absorbing cushion it holds. Regulators set a minimum to protect depositors and system stability.

International standards on bank capital, liquidity, and risk management issued by the Basel Committee. Successive versions tightened the definition of capital and added leverage and liquidity requirements.

India's 2016 law creating a time-bound process to resolve insolvent companies and individuals, with a committee of creditors deciding on revival or liquidation under professional resolution professionals.

A law letting secured creditors enforce their security interest without court intervention, for example by taking possession of mortgaged property and selling it to recover dues from defaulting borrowers.

Extending affordable banking, credit, insurance, and pension services to excluded groups. India pursues it through no-frills accounts, direct benefit transfer, small finance banks, and payment banks.

A mandate requiring banks to lend a minimum share of credit to agriculture, micro and small enterprises, education, housing, and weaker sections. Shortfalls must be parked in specified funds.

A mechanism that credits subsidy or welfare money straight into a beneficiary's bank account, linking it to identity and bank records to cut leakage and duplicate claims in government schemes.

India's twelve-digit unique identity number based on biometric and demographic data. It underpins e-KYC, direct benefit transfer, and digital authentication for banking and welfare services.

A real-time retail payment system that lets users send money between bank accounts using a virtual handle, supporting person-to-person and merchant transactions through mobile apps.

An electronic system for one-to-one interbank fund transfers across India, settled through the RBI's network. It is commonly used for larger, non-urgent transfers to a named account and branch.

A payment system where large-value interbank transfers settle individually and immediately in central bank money, reducing settlement risk. It is used mainly for high-value and time-critical transactions.

A pooled investment vehicle that collects money from many investors and buys a diversified portfolio managed by a professional, issuing units whose value is the net asset value.

The per-unit value of a mutual fund scheme, calculated by subtracting liabilities from the market value of assets and dividing by outstanding units. It is declared daily after market close.

A facility to invest a fixed amount in a mutual fund scheme at regular intervals, averaging purchase cost and encouraging disciplined saving rather than lump-sum market timing.

A reasoning question giving two or more premises and asking which conclusions necessarily follow. Only conclusions true in every possible arrangement of the terms are valid.

Overlapping circles used to picture set relationships in syllogisms and blood-relation puzzles. Checking all possible overlaps helps decide whether a conclusion is definitely true or merely possible.

A question type where you decide whether the given statements supply enough information to answer the question, without actually computing the final value. Options usually test each statement alone and together.

Reading values from tables, bar charts, line graphs, or pie charts and answering questions on totals, ratios, percentages, and averages. Speed depends on estimation and careful unit checks.

A fraction expressed out of one hundred, used to compare quantities and describe change. Converting between fractions, decimals, and percentages quickly is essential for aptitude calculations.

A ratio compares two quantities of the same kind by division; a proportion states that two ratios are equal. These ideas underlie partnership, mixture, and age problems.

The sum of a set of values divided by how many values there are. It is used in speed, age, and replacement problems, where changes in total often matter more than individual values.

Interest calculated on both the original principal and previously accumulated interest, so the amount grows faster than under simple interest over multiple periods, depending on the compounding frequency.

The ability to draw valid inferences from statements, spot flawed arguments, and identify assumptions. In exams it covers puzzles, arrangements, and critical-thinking questions rather than calculation.

A question type asking you to identify an argument's assumption, strengthen or weaken it, or choose a conclusion that follows. The key is separating evidence from the claim it supports.

A passage followed by questions on its main idea, tone, inference, and vocabulary in context. Answers must be supported by the text rather than by outside knowledge or personal opinion.

A conclusion drawn from evidence in a passage or set of statements without being stated outright. A valid inference must be strongly supported, not merely plausible or loosely associated.

Deciding the meaning of a word from how it is used in a sentence or passage, since many words carry several senses. The surrounding words narrow down the intended meaning.

A word with a meaning opposite to another word, such as scarce and abundant. Antonym questions test precise word knowledge and often hinge on the part of speech used.

A word that means nearly the same as another in a given context, such as brief and concise. Exact interchangeability is rare, so context decides which synonym fits.