N. S. Toor Solutions for Chapter: Loan Policy and Loan Documentation, Exercise 15: TEST YOUR SELF

Your branch has served a notice of recall of a loan, on the borrower as well as the guarantor. On which among the following, the right of set-off can be exercised:

A bank branch allows an advance to M/s Deena Nath & Co which is secured by guarantee of one Sh. Mahesh Chander. The guarantee extends to a series of transactions. Such guarantee is called:

The guarantee given by a guarantor to secure a Term Loan falls under which of the following category?

Mr. G guaranteed the loan raised by Mr. Y who failed to pay. When money was demanded from Mr. G he paid the loan and asked for handing over the securities available in the loan. Which right Mr. G has used to demand the securities?

Which of the following meets the feature of a Deferred Payment guarantee?

A firm receives raw material from abroad for processing thereof and subsequently to be re-exported after processing. What kind of guarantee shall be issued for this?

Which is among the following is not correct with regard to relationship amongst a term loan and deferred payment guarantee?

A loan of Rs.10 lac sanctioned by Corporate Bank to Mr. Siddiqui becomes doubtful loan and bank wants to recover it. Bank sends a notice to the borrower and also the guarantor Mr. Ram Kumar, who is having good means. In response to the notice Mr. Ram Kumar asserts that the bank should first proceed against the borrower and not him as liability arises only when the bank is unable to recover from the borrower: