A customer approached you as bank on 1st January, 2018 for sale to him: US Dollar 2,00,000 delivery on 31st March, 2018 US Dollar 1,00,000 delivery on 30th March, 2018 Assumptions to be taken as to Rate and Margin: Spot

CS Professional · Banking - Law & Practice · PYQS · June 2019
A customer approached you as bank on 1st January, 2018 for sale to him: US Dollar 2,00,000 delivery on 31st March, 2018 US Dollar 1,00,000 delivery on 30th March, 2018 Assumptions to be taken as to Rate and Margin: Spot interbank 66.5000/5100 Forward premia January 0.1350/0.1450, February 0.3050/0.3150, March 0.5500/0.5600, April 0.7700/0.7800 Exchange margin @ 0.125%. Calculate the rates to be quoted to the customer by the bank. Take last two digit in the multiples of 25.

Answer & Explanation:

(1) The Importer customer approached on 01.01.2018 for buying of US $ 2,00,000 delivery on 31st March, 2018. ₹ Spot interbank rate (being import sale) 66.5100 Add: Premium up to 31.03.2018 0.5600 67.0700 Add: Exchange margin @ 0.125% 0.0838 67.1538 Rounded off to ₹ 67.1550 (2) US $ 1,00,000 delivery on 30th March, 2018 ₹ Spot interbank rate 66.5100 Add: Premium up to 30.03.2018 0.5600 67.0700 Add: Exchange margin @ 0.125% 0.0838 67.1538 Rounded off to ₹ 67.1550 The rates to be quoted by the bank for USD 2,00,000 @ 67.1550 and US $ 1,00,000 @ 67.1550.

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