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Module: General Practice

Q14: What is a "Shell Bank"?

A
A bank that is unaffiliated with a regulated financial group.
B
A bank that has no physical presence in the country where it is incorporated and licensed, and is unaffiliated with a regulated financial group.
C
A bank whose "meaningful mind and management" is located within a country, even if it only has a local agent.
D
A bank that is used exclusively for correspondent banking services.
✅ Correct Answer: B
A "Shell Bank" is defined as a bank that has no physical presence in the country of incorporation and is unaffiliated with a regulated financial group.
This definition is frequently asked in RBI KYC Guidelines MCQs.
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