Many large borrowers’ business and their debt servicing capacities have been affected by many reasons. Considering the socio-economic impacts and employment generation perspective of the affected large borrowers. Loan Rescheduling and Restructuring is now common in modern banking to keep the bad loan regular. For...
Core Risks in Banking In recognition of the importance of an effective risk management system the five core risks that have been advised to manage in these guidelines are: a) Credit Risk Management, b) Asset-Liability Management c) Foreign Exchange Risk Management, d) Internal Control and...
Loan Recovery There is a separate Recovery Unit (RU) in each bank. This unit should directly manage accounts with continuous deterioration. Its primary responsibilities are to determine recovery strategy, pursue all options to maximize recovery, ensure adequate and timely loan loss provisioning, etc. The management...
Loan Risk Grading The Credit Risk Grading (CRG) is a collective definition based on the pre-specified scale and reflects the underlying credit risk for a given exposure. A Credit Risk Grading deploys a number/ alphabet/ symbol as a primary summary indicator of risks associated with...
Loan Proposal Preparation and Approval The quality of a loan proposal is a key factor in achieving the results for a business. It can make the difference between a ‘yes’ and a ‘no’ to a loan application. An effective loan proposal should be prepared such...
Borrower selection A bank usually has procedural guidelines indicating list and sequence of several activities associated with its credit operations. The procedural guideline is prepared in the light of Credit Risk Manual introduced by Bangladesh Bank. However, bank’s own credit policy vision, mission as well...
Environmental Risk Management Environmental Risk Management is for assessing environmental risks and not intended to squeeze investment; rather it is for sustainable finance. Environment management in the banking business is like risk management. It increases the enterprise value and lowers loss ratio as higher quality...
Credit Appraisal Credit appraisal process is an essential part for investment decision and project selection. Credit appraisal may be defined as a detailed evaluation of the credit proposal to determine the technical feasibility, economic necessity, marketing prospect, financial viability of the project and managerial competence...
UPAS (Usance Paid At Sight) LC The best way to understand the process is to follow it from beginning to end. The applicant and the supplier or exporter agree on terms of sale where the beneficiary will be paid at sight. A letter of...
