Bank Verbal Reasoning Test Practice

A regional bank plans to close four of its 31 branches by the end of next year. All four are within fifteen minutes' drive of another branch, and counter transactions at each have fallen by more than half in five years. Staff at the four will be offered roles elsewhere in the network, and the bank expects no compulsory redundancies. Before any closure it will consult the local community for twelve weeks. Customers who do not use online banking will be offered help from a visiting adviser for six months after their branch closes. The bank says the savings will go to its telephone service, but has not said how much that will be.

Customers reported 1,240 cases of payment fraud to the bank last year, up from 980 the year before. In most cases a customer was persuaded to send money to an account controlled by a criminal, often after a call from someone claiming to be from the bank. The bank reimbursed about 60% of the losses. From next April it will hold first-time payments above US$5,000 for up to 24 hours while it contacts the customer. It accepts that this will inconvenience some customers, and says the protection is worth it. The bank does not ask for passwords by phone, and tells customers to end any call that does.

The bank's graduate programme lasts two years and has three rotations of eight months: a lending desk, then risk or operations, then a team the graduate chooses, subject to vacancies. Each graduate has a mentor outside their reporting line and sits a written assessment at the end of each rotation. A graduate who fails may retake the assessment once. The programme takes 40 graduates a year. Twelve of them join technology teams and follow a separate plan. At the end, graduates apply for permanent roles. A role is not guaranteed, although last year every graduate who applied was placed.

The bank tightened its commercial property lending policy in March. New loans on office buildings may now be made at up to 55% of valuation, down from 65%. Loans on industrial buildings stay at 65%. Every office valuation must be less than six months old when the loan is approved. Existing loans are unaffected until their next review date, when they are tested against the new limit. A loan found above the limit at review is not called in: the borrower has twelve months to reduce it or to provide more security. The credit team expects less new office lending this year, but has published no estimate.

Term deposits now make up 38% of the bank's customer funding, against 29% two years ago, as savers have moved money out of everyday accounts to earn higher rates. The shift has raised the bank's cost of funding, because term deposits pay more than everyday accounts. Management expects the trend to slow if rates fall, but not to reverse. Term deposits do have one advantage for the bank: they cannot be withdrawn early without a penalty, which makes them more stable. At the results briefing, analysts asked whether margins would fall next year. The chief financial officer declined to give a forecast.