IMI NEW DELHI --PGDM MOB FOREX NUMERICALS -By Prof.

Deepak Tandon
HO 5

Q1. M/s Rex Exports offers to HSBC New Delhi a sight bill for USD 258000 on 01.01.13 drawn under
a letter of Credit established by Amas Bank Geneva. Assuming the following please tell how much
IRS will you credit to the exporters account?
Inter bank rate ---1USD =57.5850/60
Transit period is 10 days
Interest rate is 11%
Exchange margin is 0.15%

Q2. On 01.04.13 the ruling rates are

Inter Bank 1USD = Rs 58.5850/5950
The bank has been authorized to retain 0.090%for the transaction involving Inward remittance of
USD 91758 value spot. In the rupee terms how much will the customer get and what is the effective
exchange rate?

Q3. Determine which of the following is Purchase/ Sales and the rate applicable
Spot Card Rates are 57.90/57.80 57.70/57.60
(a)The bank issues a Draft to Ms Jennifer a NRI for USD 25000
(b) The Customer of a Bank purchases a TT on New York for USD 5,00,000
( c ) The Bank purchases a DD drawn on London for USD 1,00000
(d) M/s Ravi Importers retire a bill from OBC for USD 10,00,000 and make payment to m/s Cottage
industries for a import document under L/c of HSBC Hongkong on sight basis

Q4. You have disbursed an education loan to a student perusing his M.B.A at the Harvard
university . In pursuance to the admission and Semester fee the student wants a draft in US Dollars
for USD25000/-
Assuming the Spot rates in the local market for USD are
SPOT --------------------USD 1 = Rs 58.3575/3825
1 month forward -------Rs 58.7825/8250
You require an exchange margin of 0.15%
HOW DO YOU PROCEED ?

What is the rupee equivalent you will take from the student ?

Q5. . The following is the quotation of Oriental bank Of commerce as on 1.4.2013

58.80/ 58.90/ 58.50/ 58.35
(i) There is a Export Bill for US$ 1 Lac to be purchased
(ii) Payment of DD issued by your York branch. Where you maintain Nostro A/C
(iii) Retirement of foreign Inward Bill for collection (Documentary)
(iv) Realisation of foreign Outward Bill for collection, proceeds already credited in you’re
a/c (Nostro)
(v) Remittance to U.S representing gift amount permissible under FEMA (1999) on behalf of
your customer.

Q6. On 1.07.13 , your( bank) customer has presented to you at sight documents for USD 1lac under
an irrevocable L/C . The l/c provides for reimbursement by the negotiating Bank ‘s own demand
draft on the opening Bank at New York .
Assuming Rs/USD are quoted in the local Interbank market as under :
Spot 1 USD =Rs 58.6525/6650
Spot /August ---6000/5700
Spot/ September –1.000/0.9700
Spot/October ----1.4000/3900
Transit period for the bill is 25 days.rate of interest 10% What rate would you quote to your customer
provided you require an exchange margin of 0.15%. Also calculate and show the amount payable to
the customer.Rate of Interest is 10% p.a

1
Q7. The following are the spot rates as on 30.09.12
57.50/47.00 57.85/47.00 57.00/57.50 57.25/57.00 Forward 2M = 57.00 / 57.25 3m =57.65 / 57.00
(a) Your Importer customer requests you to book a Forward exchange contract for USD
10,000 delivery 3rd month
(b) M/s Rex Exports has presented a sight bill for USD 258,000 drawn under L/c of Amas bank
Geneva.
(c) Under BTQ your customer (An Exporter) –Mr Kharbanda wishes to go to Singapore with his
wife and two minor children . He has valid visa and to and fro Air tickets from Delhi to
Singapore and Back. He wishes to take USD 40000. Please advise the rate applied for 8000
Currency and USD 32000 Traveller Cheques.
(d) Consequent to return Mr Kharbanda wishes to tender USD 20000 Traveller Cheques .
(e) A draft has been received by Mrs Balwant Kaur for USD 1000 remitted by her son (Kuldeep)
from USA for USD 10000. Mrs Kaur wants the proceeds to be credited in her NRO account
with Punjab National Bank . The draft is payable in India on PNB Overseas Branch New
Delhi Please state the rates to be applied.

Q8 Your Exporter Customer , an Export Oriented Unit has presented to you sight documents for
USD 1 lac for negotiation under a letter of credit providing for value date TT reimbursement
Interbank Rates are IUSD = Rs 58.1500/1600

Your customer requests :

(1) To retain 70% of amount of the bill in their EEFC account

(2) To pay a commission of 0.5% to their Indian Agent as mentioned in LC
Calculate the Indian Rupees amount to be credited to the customer’s account taking in
consideration :
(a) Exchange Margin of 0.15% is required by you
(b) Exchange Rates be quoted as per FEDAI Rules
(c) Rupee amount be expressed in nearest Rupee

Q9 You as a Forex Dealer have the following dealing position in Frankfurt. What must do you do
to make it square?
Your account in Frankfurt is overdrawn GBP 6,75,000. You have purchased Cheques which are in
course of post and not yet credited to your account totaling GBP 6,28,000. You have forward
contracts outstanding as follows :
Sales GBP 1,66,88,000
Purchases GBP1,50,00,000
You have issued drafts not yet presented for payment for GBP 12,20,000 . You have long bills
purchased in hand and not due for GBP 28,85,600

Q10 SWAPS