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project on recovery management of banks

project on recovery management of banks

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Published by mandar_13

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Published by: mandar_13 on Feb 18, 2010
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09/30/2014

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RECOVERY MANAGEMENT IN BANKS
CHAPTER 1
Introduction
Banks were never so serious in their efforts to ensuretimely recovery and consequent reduction of NPAs as theyare today. It is important to remember that recoverymanagement, be of fresh loans or old loans, is central toNPA management. This management process needs to startat the loan initiating stage itself. Effective management of recovery and NPA comprise two pronged strategy. Firstrelates to arresting of the defaults and creation of NPAthereof and the second is to handling of loan delinquencies.The tenets of financial sector reforms were revolutionarywhich created a sense of urgency in the minds of staff of bank and gave them a message that either they perform or perish. The prudential norm has forced the bank to look intothe asset quality.A debt from a loan, credit line or accountsreceivable that is recovered either in whole or in part after ithas been written off or classified as a bad debt. Inaccounting, the bad debt recovery would credit the"allowance for bad debts" or "bad debt reserve" categories,and reduce the "accounts receivable" category in the books.
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RECOVERY MANAGEMENT IN BANKS
Not all bad debt recoveries are "like-kind" recoveries.For example, a collateralized loan that has been written off may be partially recovered through sale of the collateral. Or,a bank may receive equity in exchange for writing off a loan,which could later result in recovery of the loan and, perhaps,some additional profit.
Recovery
Recovery is defined as the process of regaining and saving something lost or in danger of becoming costs
.”
Recovery is a key to the stability of the banking sector there should be no hesitation in stating that Indian bankshave done a remarkable job in containment of Non-Performing Assets (NPA) considering the over all difficultenvironment. Recovery management is also linked to thebank’s interest margin’s we must recognize that cost andrecovery management supported by enabling legalframework hold the key to future health and competitivenessof the Indian banks. No doubt, improving recoverymanagement in India is an area requiring expeditions andeffective actions in legal institutional and judicial processes.Banks at present experience considerable difficulties inrecovering loans and enforcement of securities charged withthem. The existing procedure for recovery of debts due tobanks has blocked a significant portion of their funds inunproductive assets, the value of which deteriorates with thepassage of time.
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RECOVERY MANAGEMENT IN BANKS
1.1 Why recovery management?
Bank deserves to be paid for their products andservices. The collection professionals in RecoveryManagement Systems will work to see that.
Reasonable fees with no up-front costs. They get paidonly when it is collect.
Recovery Management Systems will design acollection strategy to meet bank’s objectives. Bank canrecover their debts without losing customers.
Monthly settlements with meaningful reporting. Statusupdates on demand.
Extensive experience obtaining and collecting money judgments in Ohio. Garnishments, liens, and leviesRecovery Management Systems will collect when legalaction is the only option.
Cutting edge skip-tracing tools and techniquesrecovery Management Systems can work 1st, 2nd, and3rd placements and even turn bank old judgments intomoney.
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