WWW.SMUSOLVEDASSIGNMENTS.COM GET BEST QUALITY SOLVED ASSIGNMENTS VISIT WWW.SMUSOLVEDASSIGNMENTS.COM Or Mail us at solvemyassignments@gmail.com YOU MAY CALL US ON - 7506193173 WHATSAPP NUMBER- 9967480770 INTERNAL ASSIGNMENT APPLICABLE FOR SEPTEMBER 2019 EXAMINATION Treasury Management in Banking 1. ABC global bank is operating in over 40 countries and has assets worth USD 30 Billion. Due to high growth in the emerging markets in the last two decades, the bank has been facing challenges due to high growth in volumes and increasing product complexity. The major treasury operations of the bank include Trading and settlement, cash management, back office management back office function, trade matching, reconciliation etc. Considering the mentioned challenges and growth of the bank, suggest whether integrating treasury operations would prove beneficial for ABC global Bank or not? Highlight the benefits of integrating the treasury operations. (10 Marks) 2. Risk Measurement forms an important aspect for sound banking system. Keeping the above statement, enumerate the two risk methods i.e. value at risk and Scenario Analysis methods which are used widely by the banks. (10 Marks) 3. “A prudent liquidity management ensures bank’s solvency and overall stability in an economy” a. Discuss The impact on liquidity and inflation when CRR increases and reduces respectively. (5 Marks) b. Highlight the differences between Cash Reserve Ratio and Statutory Liquidity Ratio. (5 Marks) International Banking & Foreign Exchange Management 1. An exporter wants to hedge his one year receivables in USD for $20 million, for which he wants to enter into a futures contract. The spot exchange rate is USD-INR70. The futures price for a contract having the same maturity date is ₹71. Is perfect hedging possible with the futures contract in this case? Calculate loss or profit in the cash and futures market if the spot price is ₹ 72 on the maturity date. (10 Marks) 2. Amaron Ltd was exporting goods to Axa Ltd in Japan and wanted to be sure of payment to be received on time. It made a request to the importer to issue Letter of Credit in the name of Amaron Ltd. The manager at Axa Ltd approached his bank manager to understand the steps involved in the issue. If you are the manager mention the steps that would be involved in the Letter of Credit transaction. (10 Marks) 3. Aruna had completed her post-graduation in International Banking and had joined the forex department of a bank. She was explained clearly by her manager that the merchant buying and selling rates are derived with the help of the rates prevalent in the inter-bank markets and both are calculated differently. Her manager wanted her to prepare notes on how the rates are determined in the case of: a. Market’s Selling Rate (5 Marks) b. Market’s Buying Rate (5 Marks) Insurance & Risk Management 1. Sam took a health insurance policy from a reputed insurance company. At the time of taking policy, he was a smoker and he didn’t disclose this fact intentionally to the insurance company. He got cancer few years later and died subsequently. Insurance company denied the claim. Analyse the above statement and highlight which insurance principle will be applicable in the above scenario. Also mention the facts that must be disclosed by the insured while entering into a contract. (10 Marks)
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