Preparing for the CAIIB Bank Financial Management (BFM) 2026 exam can be challenging, especially with so many concepts, ratios, and case studies to remember. To make your preparation more focused and efficient, we have compiled some of the most frequently asked questions from topics that have appeared repeatedly in past exams, along with correct answers and detailed explanations. These questions cover all the important areas such as Liquidity Coverage Ratio (LCR), Net Interest Margin (NIM), Basel III, provisions, derivatives, forex, treasury management, and more.
In this blog, we provide details of the common CAIIB BFM topics, a PDF comprising 100 questions from these topics, and a quiz that allows professionals to analyze their performance.
Download the Most Repetitive Questions for CAIIB BFM
Make your CAIIB BFM 2026 preparation more focused and effective by downloading the most important BFM questions from topics that appear most frequently in past exams. Every question comes with the correct answer and detailed solutions to help you understand concepts thoroughly. The direct link to download the PDF is provided below:
Attempt CAIIB BFM Quiz
Test your preparation with our CAIIB BFM Quiz featuring 20 carefully selected questions. These are specially designed for banking professionals, covering the most frequently asked topics and helping you assess your understanding of key financial management concepts.
CAIIB BFM Practice Quiz
1. Net Interest Margin (NIM) is calculated as:
2. A bank earns interest income of ₹500 crore and pays interest expenses of ₹300 crore. Average earning assets are ₹4000 crore. What is the NIM?
3. Net Interest Income (NII) is defined as:
4. If a bank’s cost of funds is 5% and yield on advances is 9%, the net interest spread is:
5. Which of the following would lead to a reduction in NIM of a bank?
6. What is the minimum Common Equity Tier 1 (CET-1) ratio prescribed under Basel III?
7. Which of the following instruments qualifies as Additional Tier 1 (AT1) capital under Basel III?
8. Under Basel III, the Capital Conservation Buffer (CCB) requirement is:
9. What is the minimum Tier 1 Capital ratio required under Basel III?
10. Which of the following is NOT included in Tier 1 capital?
11. As per RBI guidelines, what is the provision requirement for Sub-Standard Assets (unsecured)?
12. An account becomes NPA when it remains overdue for a period of more than:
13. What is the minimum provision required for Loss Assets?
14. Provision for Standard Assets is required at:
15. A borrower is classified as a ‘Wilful Defaulter’ if the outstanding amount is above:
16. The price of an option if it is exercised immediately is called:
17. The ‘Delta’ of an option measures:
18. Which Greek measures the rate of change of Delta with respect to the underlying price?
19. A bond has a face value of ₹1000, coupon rate 8%, and current market price of ₹950. The current yield is approximately:
20. Beta of a security measures:
Quiz Summary
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What topics are included in the CAIIB BFM syllabus?
Bank Financial Management (BFM) Paper is one of the compulsory papers of the CAIIB and consists of four modules. Candidates must be aware of the detailed syllabus to have a better understanding of the examination.
| Module | Topics Covered |
| Module A | International Banking |
| Module B | Risk Management |
| Module C | Treasury Management |
| Module D | Balance Sheet Management |
Why is Bank Financial Management (BFM) paper important for CAIIB?
Bank Financial Management (BFM) is crucial for anyone working in the banking sector. It deals with managing a bank’s finances efficiently, ensuring financial stability, profitability, and compliance with regulations. By mastering BFM, candidates can understand financial risks, capital management, asset-liability management, and investment decision-making.
- Managing the bank’s financial performance
- Identifying and controlling financial risks
- Ensuring regulatory compliance
- Making strategic investment decisions
- Efficient management of bank’s capital
What are the most important topics for CAIIB BFM 2026?
To score well in the CAIIB BFM 2026 exam, it is essential to focus on the topics that are most frequently tested in past papers. These topics cover critical areas of banking such as liquidity, risk management, capital adequacy, profitability, provisions, derivatives, forex, and treasury operations. Understanding these areas will help candidates approach the exam strategically and efficiently.
| Topic Area | Details |
| Liquidity Ratios | Liquidity Coverage Ratio (LCR), Cash Reserve Ratio (CRR), Statutory Liquidity Ratio (SLR) |
| Risk Management | Credit risk, Interest rate risk, Currency risk, Asset-Liability Management (ALM) |
| Capital Management | Basel III norms, Capital Adequacy Ratio (CAR), Tier 1 Capital, CET-1, Capital charges |
| Profitability Metrics | Return on Assets (ROA), Return on Equity (ROE), Cost-to-Income ratio, Net Interest Margin (NIM), Net Interest Income (NII) |
| Provisions & NPAs | Standard assets provision, Wilful default provision, NPA provisioning |
| Derivatives & Treasury | Options, Bonds, Volatility, Alpha & Beta, Cash Management, Trade and Supplier Credit |
| Forex & International Banking | Exchange rates, Cross-currency operations, TT rate, FCNR deposits, NRI/NRO accounts, ECB applications |
Also Check:
| Link | Link |
| CAIIB ABM 2026 Practice Quiz | CAIIB BFM 2026 Practice Quiz |
| CAIIB ABFM 2026 Practice Quiz | Attempt CAIIB ABM Important MCQs |
Which financial ratios are most important in BFM?
Financial ratios are a backbone of bank financial management. They help in analyzing a bank’s financial health, profitability, capital adequacy, and liquidity. Mastering these ratios is essential for CAIIB candidates to interpret banking performance and make strategic decisions.
| Ratio | Purpose |
| Capital Adequacy Ratio (CAR) | Measures a bank’s financial strength and ability to cover risk-weighted assets |
| Liquidity Coverage Ratio (LCR) | Ensures that banks can meet short-term obligations with high-quality liquid assets |
| Return on Assets (ROA) | Measures how efficiently a bank uses its total assets to generate profit |
| Return on Equity (ROE) | Indicates profitability for the bank’s shareholders |
| Net Interest Margin (NIM) | Measures profitability from the bank’s core lending and investment operations |
Also Check:
| Related Article | Link |
| CAIIB BRBL Questions | Click here to Check |
| Top 50 Most Repetitive CAIIB ABM MCQs | Click here to Check |
| Top 50 Most Repetitive CAIIB BRBL MCQs | Click here to Check |
| Top 50 Most Repetitive CAIIB ABFM MCQs | Click here to Check |
FAQs
Ans. Key topics include financial ratios, capital adequacy, liquidity management, and risk management.
Ans. Focus on understanding the core concepts in financial management and practice frequently asked questions.
Ans. They are repeated because they test fundamental concepts that are essential for the banking industry.
Ans. Focus on questions related to risk management, treasury operations, and financial regulations, as they are frequently tested.
- 50 Most Repetitive Questions for CAIIB ABM 2026, Download PDF
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- Attempt CAIIB ABM Important MCQs and Download PDF
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- 50 Most Repetitive Questions for CAIIB ABFM 2026, Download PDF
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