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Credit Management

Program : MBA Class of : 2007

Semester : IV Sessions : 33

Course Code : BKG 607 Credit : 3 Units

Objective

The objective of this course is to provide the students with adequate knowledge about the management of Credit portfolio in banks. It will provide sufficient inputs to enable the student to develop an insightregarding the different phases of Credit management.

Reference Books Author / Publication

Credit Management ICFAI

Practical Banking Advances H.L.Bedi and V.K. Hardikar/ UBS Publishers

The Bank Credit Analysis Jonathan Golin/John Wiley & Sons

Frontiers in Credit Risk Gordian Gaeta/ John Wiley & Sons

Money, Credit and Capital James Tobin/McGraw

Credit Risk Michael Hanke/Springer

Credit and Banking K.C.Nanda/Response

Credit Appraisal, Risk Analysis & Decisionmaking

Mukherjee/Snow White

Detailed Curriculum

Overview: Lending Activity BasicRequirements for Lending.

Principles of Credit Management: Principlesof Lending Evaluation of Borrower The 6 Cs

Fair Practices Code.

Objectives of Credit Management: CreditAllocation Credit Evaluation CreditDiscipline Credit Monitoring.

Credit Policy in Banks: Need for Credit Policy Components of Credit Policy Credit Policy

Pursued by the Government Credit Culture.

Regulatory Framework: GovernmentRegulation of Banks Institutional Structure

Need for Statutory Reserves Cash ReserveRatio (CRR) Statutory Liquidity Ratio (SLR).

Credit Deployment: Role of Bank Credit Types of Credit Bank Credit for Various

Sectors Credit Deployment Scenario PostFinancial Sector Reforms.

Prudential Norms: Capital, Adequacy of Banks Prudential Norms for Ensuring Greater transparency Capital Tiers.

Types of Borrowers: Various Categories Features of a Company as a Borrower SpecialTypes of Customers.

Documentation: Importance of Documentation Security of Documentation Renewal of Documents Security Offered for Documents.

Credit Evaluation: Term Loans: Sources of Finance Term Loans Project Appraisal Capital Budgeting.

Credit Evaluation: Working Capital Finance:Concept of Working Capital FactorsDetermining Working Capital Working CapitalCycle (Operating).

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Credit Monitoring: Financial Supervision Financial Follow-up Financial Follow-upReports Physical Follow-up.

Follow up and Recovery Management: CreditRisk Identifying Problem Loans Loan

Classification Contingent Risk.

Debt Recovery Tribunals: Origin and Object of the Act The Functioning of Debt RecoveryTribunal Modes of Recovery Jurisdiction,Powers and Authority of Tribunals Authorityof Debt Recovery Tribunal.

Securitization Act: Securitization Company Functions of Assets Reconstruction Company Powers of Central Registry.

Suggested Schedule of Sessions

Topic No. of Sessions

Overview 1

Principles of Credit Management 2

Objectives of Credit Management 2

Credit Policy in Banks 3

Regulatory Framework 2

Credit Deployment 3

Prudential Norms 2

Types of Borrowers 2

Documentation 2

Credit Evaluation: Term Loans 3

Credit Evaluation: Working CapitalFinance

3

Credit Monitoring 2

Follow up and RecoveryManagement

2

Debt Recovery Tribunals 2

Securitization Act 2Total Sessions 33

Note: Screen indicates syllabus for Mid-Semester examination.