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    1) The document discusses various topics related to lending products, operations, and risk management for banks including open-ended and close-ended guarantees, advantages and disadvantages of fixed rate lending, interest rate risk, maintaining a due date diary, facility monitoring systems, restructuring and rescheduling of non-performing loans, components of a credit policy, and impact of lending to corporate and individual customers. 2) It also provides questions about documents required for loan approval and after approval but before disbursement, evaluating trends in financial ratios to assess lending to a prospective borrower, and how a bank can mitigate risk if it decides to lend against negative assessment. 3) The final question defines a well divers

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    IBP EXAM PAST PAPER OF LENDING 2012

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    1) The document discusses various topics related to lending products, operations, and risk management for banks including open-ended and close-ended guarantees, advantages and disadvantages of fixed rate lending, interest rate risk, maintaining a due date diary, facility monitoring systems, restructuring and rescheduling of non-performing loans, components of a credit policy, and impact of lending to corporate and individual customers. 2) It also provides questions about documents required for loan approval and after approval but before disbursement, evaluating trends in financial ratios to assess lending to a prospective borrower, and how a bank can mitigate risk if it decides to lend against negative assessment. 3) The final question defines a well divers

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PDF, TXT or read online from Scribd
    Flag for inappropriate content
    7 views2 pages

    6 Lending Products S 2012

    Uploaded by

    moshu_0704
    1) The document discusses various topics related to lending products, operations, and risk management for banks including open-ended and close-ended guarantees, advantages and disadvantages of fixed rate lending, interest rate risk, maintaining a due date diary, facility monitoring systems, restructuring and rescheduling of non-performing loans, components of a credit policy, and impact of lending to corporate and individual customers. 2) It also provides questions about documents required for loan approval and after approval but before disbursement, evaluating trends in financial ratios to assess lending to a prospective borrower, and how a bank can mitigate risk if it decides to lend against negative assessment. 3) The final question defines a well divers

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PDF, TXT or read online from Scribd
    Flag for inappropriate content
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    ISQ Examination (Summer-2012) Lending Products, Operations & Risk Management Stage-II

    Q. Q. Q. A) B) A) Define open-ended and close-ended guarantees. State the features of a bank guarantee. Explain the advantages and disadvantages of fixed rate lending for i. Lenders. ii. Borrowers. What is meant by interest rate risk?
    What are the benefits of maintaining a due-date diary for obtaining periodic documents from the borrower?

    Q. Q. Q. Q. Q. Q. Q. Q.

    B) A) B) A) B) A) B)

    How is facility monitoring system applied on regular accounts? State any THREE ways. Write any TWO similarities of restructuring and rescheduling of an NPL account. Write any THREE differences between restructuring rescheduling of Non-Performance Loan (NPL) account. What is the purpose of a banks credit policy? List any FOUR components and explain any TWO. and

    When a bank decides to lend to a customer, the decision has an impact not only on the customer but others around him as well. Explain the impact that is created when a bank lends to a A. B. Corporate Customer. Individual Customer.

    Q.

    You are a Relationship Manager at a medium commercial bank. M/s Faisal & Co. a private limited company engaged in towel manufacturing and export business approaches you for establishing pre-shipment lines for Rs.300.0 million. As a security, the customer is offering charge over current and fixed assets of the company. List the specific documents required. A. At the time of approval B. After approval and before disbursement

    Q.

    A)

    From the following data, evaluate the trend of financial ratios of Progressive Textiles Limited, a prospective borrower, to arrive at a decision. Provide justification for your decision to lend or not to M/s Progressive Textiles Ltd. Financial ratios of the Progressive Textiles Limited 2011 2012 2013

    Current ratio Acid-test ratio Average collection period Inventory turnover Total debt/equity Long term debt/total capitalization Gross profit margin Net profit margin Total asset turnover Return on assets Q. Q. B)

    1.19 0.43 18 8 1.38 0.33 0.2 0.075 2.8 0.21

    1.25 46 22 7.5 1.4 0.32 0.163 0.047 2.76 0.13

    1.2 0.4 27 5.5 1.61 0.32 0.132 0.026 2.24 0.06

    Suppose that your decision is in negative but the bank decides to lend anyway, how will it mitigate the risk?

    What is a well diversified risk portfolio? Elaborate the importance of a well diversified risk portfolio.

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