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Cfm 304-F: Banking Law And Practice Question Paper

Cfm 304-F: Banking Law And Practice

Course:Bachelor Of Commerce

Institution: Kca University question papers

Exam Year:2009

1
UNIVERSITY EXAMINATIONS: 2008/2009
THIRD YEAR STAGE 1 EXAMINATION FOR THE DEGREE OF
BACHELOR OF COMMERCE
CFM 304-F: BANKING LAW AND PRACTICE (Sunday)
DATE: APRIL 2009 TIME: 2 HOURS
INSTRUCTIONS: Answer question ONE and any other TWO questions
QUESTION ONE
a) When in banking law does a person qualify to be called a customer of the bank? (6 Marks)
b) Explain the Principles of good lending (7 Marks)
c) Briefly explain the requirements of a valid endorsement (6Marks)
d) ‘The infant customer gives rise to very technical problems’ discuss this statement in reference to
minor-customers’ accounts (6 Marks)
e) Explain the contents of a bill of lading as used in foreign exchange transactions. (5Marks)
QUESTION TWO
(a) Give a detailed account of the meaning of ‘Bank’ (5 Marks)
(b) The banking Act Cap 488 of the Laws of Kenya lays a tight procedure for the regulation, licensing
and operation of banks in this country. Outline the measures put in place and comment on their
efficacy or otherwise. (15 Marks)
QUESTION THREE
(a) Explain the functions of the Central Bank as contained in the Central Bank Act (10 Marks)
(b) Discuss the circumstances and factors which lead to termination of the banker-customer
relationship (10 Marks)
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QUESTION FOUR
a) Explain any five essential characteristics of a negotiable instrument? (5 Marks)
b) With help of illustrations and decided cases, discuss the exceptions to the duty of confidentiality
imposed on a banker? (10 Marks)
c) Briefly discuss the distinctive nature and characteristics of a current account (5 Marks)
QUESTION FIVE
Write short explanatory notes on:
a) The Distinguishing features between a bill of exchange and a cheque (5Marks)
b) The banker’s duty of care and skill (5 Marks)
c) Banker’s right of lien (5 Marks)
d) Financing of foreign exchange transactions (5 Marks)

Cfm 304-F: Banking Law And Practice Question Paper

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