Sikkim-Manipal University of Health Medical and Technological Sciences (SMUHMTS) 2009 Post Graduate Diploma Bank management MA0033 - Treasury Management - Assignments for spring session - Quest

POST GRADUATION DIPLOMA IN BANK MANAGEMENT
ASSIGNMENT
MA0033
Set 1
(2 credits)
Marks 30
Subject Name: Treasury Management
All ques. carry equal marks
Q.1. discuss the Functions of Integrated Treasury of a Bank.
Q.2. Distinguish ranging from Collateralized Borrowing & Lending Obligation, Repo and reverse Repo
Q.3. An Indian company finds the subsequent quotes(Rs/$)
Spot 45.80/46
three month forward 46.00/46.10
six month forward 46.10/46.30
The company needs $ funds for six months. If Interest rates are provided as below, determine whether company should borrow in rupees or in $.
3-month interest rates : Rs- 7% $- 4%
6-month interest rates: Rs- 6.5% $ - 3.5%
Q.4. discuss with the help of an example the concept of ‘Cap’ and ‘Floor’ in relation to an Interest Rate choice.
Q.5. Prepare an estimate of working capital requirement of a manufacturing company from the details furnished beneath relating to the year 2007-08 Rs Sales for three months credit 48,00.000
Raw materials purchased 18,00,000
Wages paid 15 days in arrears 10,80,000
Manufacturing overheads- one month in arrears 4,80,000
Administrative overheads- one month in arrears 1,20,000
Sales promotion expenses payable three months
In advance 1,20,000
Income Tax Payable(at the end of every quarter) 1,00,000
The company enjoys 1 month’s credit from the supplier of raw materials. It maintains 2 months stock of raw materials and 2 months stock of finished goods. Cash balance is maintained at Rs50,000. presume 10% for contingency.
Q.6. Case study: An Indian company is planning to invest $100 million in USA. The return on investment is expected to be 50%. The spot rate is Rs45 per $. 1 year forward rate is Rs46.00 per $. The company can access rupee funds in India at 15%. An American Bank has offered to supply $100 million at a rate of Rs44 per $ and swap the identical amount at Rs44 per $ after 1 year. The bank will charge Interest at 10 % on the loan. discuss whether the company should accept the bank’s offer. presume that there is no restriction for repatriation of funds in both dollars and rupees.

POST GRADUATION DIPLOMA IN BANK MANAGEMENT
ASSIGNMENT
Subject code: MA0033
(2 credits)
Set 2
Marks 30
Subject Name: Treasury Management
All ques. carry equal marks
Q.1. discuss the features of a Forward Rate agreement

Earning:   Approval pending.