Chapter XII

1. Describe the manner of clearing country bank cheques through the London Bankers' Clearing House. [L.C.C.

2. Describe the Clearing House and its economic services. What inferences may be deduced from a study of the Clearing House accounts? [I.B.

3. Describe the country clearing and trace the course of a cheque payable in Leeds, and received by a banker in Bristol. [I.B.

Chapter XIII

1. What do you consider the "liquid resources" of a bank? [I.B.

2. In the event of a run on a Bank, what resources would such a Bank fall back on first? [I.B.S.

3. State generally the sources of a banker's profits, the chief items in his expenditure, and the probable causes of his losses. [I.B.

4. Describe the different methods in which a banker employs his resources, and state roughly the average proportion of each holding that is usually maintained by the London banks. [I.B.

5. In discounting bills for a customer, what are the points to be considered? [I.B.

Chapter XIV

1. State briefly the relations between a banker and his customer, and those between a banker and the public. [I.B.

2. John Jones has a banking account in his own name, and pays into his credit cheques payable to the order of Smith, Brown & Co., for whom he is agent, which he endorses per pro. Under what circumstances would you receive such cheques to his credit? [I.B.

3. A banker cashes two cheques upon another bank for a stranger. A week after payment it is discovered that in one case the drawer's signature is a forgery, in the other case the payee's signature is a forgery. What is the position of the banker who cashed the two cheques? [I.B.

4. State what would be the liability on a bank if valuables deposited with it for safe custody were lost or stolen. [I.B.

5. What responsibilities does a banker assume for the custody of (a) Share certificates left with him in a closed box.

(b) Bonds from which he has instructions to cut off the coupons and collect them for his customer's credit.

(c) Railway shares left with instructions to sell them through a broker? [I.B.

Chapters XV And XVI

1. Compare the respective merits of the following forms of collateral security:

Deposit of title deeds.

Railway stock registered in the bank's name.

Securities to bearer.

Transfers in blank.

Local shares. [I.B.I.

2. What points are of primary importance when considering an application for an advance made by a limited company, and what particular form of security is in such cases desirable and available for the company? [I.B.I.

3. Share securities taken by a banker prove subsequently to be trust property; how is the banker affected? [I.B.I.

4. Give your opinion as to how far loans (a) on land and buildings, and (b) on life policies are advisable; and (c) if so under what safeguards. [I.B.S.

Chapter XVII

1. Define "Bank Rate," "Market Rate," and "Deposit Rate," and show the connection between them. [L.C.C.

2. In what way does a rise in the Bank Rate affect (a) wholesale trade; (b) the Stock Exchange; (c) banking profits? [L.C.C.

3. Does the Bank of England Rate always control the money market? Give reasons for your answer. [I.B.I.

4. What is meant by "money at call," and what is the advantage it offers to the banker? [I.B.

5. Give an account of the principal periodic fluctuations or disturbances in the money market. Particularly explain the reasons of the extra drain upon the Bank Reserve in or about the month of October in each year. [I.B.

Chapter XVIII

1. Explain the significance of the items "Other Deposits" and "Other Securities" in the weekly return of the Bank of England. How is the variation in the amount of "Other Securities" in the Banking Department at the turn of the year and of the half year accounted for, and what weakness in our banking system does it reveal? [L.C.C.

2. State the functions which the Bank of England discharges to the State and to the other banks. [I.B.S.

3. Quote as nearly as possible a recent return of the Bank of England, and describe the meaning of the various items. [I.B.

Chapters XIX And XX

1. Where and how are foreign bills for purpose of remittance bought and sold in this country? Mention two of the chief causes of fluctuation in the price of such bills. [L.C.C.

2. What are the essential conditions to ensure a movement of bullion from, say, Paris to London, or vice versa? What determines the maximum variation in the rates of the Real Exchange between any two countries? [I.B.I.

3. Explain the terms "favourable" and "unfavourable" in connection with the Foreign Exchanges, and also the saying "high rates are for us, and low rates against us." [I.B.I.

4. Explain the reasons why Britain draws few Foreign Bills but accepts many. [I.B.S.

5. State, with reasons, what effect a rise in the value of money in London has upon Foreign Exchanges. [I.B.S.

6. If the Paris Exchange falls below 25 '10 or rises above 25 '35, how would accounts between London and Paris very probably be paid? Give reasons for your answer. [I.B.S.

Chapter XXI

1. What is the difference between a Stock Jobber and a Stock Broker, and what are their respective duties? [I.B.S.

2. What are Inscribed Stocks; wherein do they, as a rule, differ from other British Stocks; and how are they transferred? [I.B.S.

3. Define the following terms, viz.: bull, bear, contango, and backwardation. Explain fully the method of "carrying over" Stock on the Stock Exchange. [I.B.S.

4. What is Settling-day on the Stock Exchange? How often does it occur, and what is its use? [I.B.S.