IILM Institute for Higher Education

Course Manual Bank Lending and Credit Appraisal BA-302

PGP 2009-11

1

Rose and Sylvia C. II. Components and schedules of the Bank Balance sheet 5.edu b. Financial deregulation and its implications for banking strategy 4. Credit Risk Management. Understanding of the Indian Bank’s & Institution’s Financial Statements. Asset Liability Management 11. Oxford Publishing b. Tata McGraw Hill c. Structure of Indian Banking & Financial Institutions 3. VAR model and Operational risk management 10. Prof Sandhya Prakash: sandhya. Asset Classification & Management of Credit Risk (Loans) 9. Prof Leena Kinger Hans: leena. Credit and Operational Risk Management) Prudential Norms on Capital Adequacy. Thomson Press d. Introduction to Banking by Vijayaragavan Iyengar.I. BOOKS AND REFERENCES: a. Treasury functions. Koch and S. Management of Interest Rate and Liquidity Risk. COURSE FACILITATORS (names of faculty teaching in LR and GGN. along with contact details) a. Banking Strategy. Macro Aspects of Banking 2.hans@iilm. Projects by Prasanna Chandra. Tata McGraw Hill e. Scott Macdonald.prakash@iilm. Credit Appraisal-Types and lending & Credit management 8. Role and components of RBI functions –CRR and SLR requirements 6. Basel II Accord and its implementation.edu Course Objectives: This course is aimed at imparting knowledge on the Banking system in India which covers understanding balance sheet dynamics and financial management of banks and institutions which in turn helps in understanding the balancing acts of liquidity and profitability and risk management. Bank Management & Financial Services by Peter S. the objective is to understand the Credit Appraisal system in the Indian banking industry. At the end of the course students will be able to have a grasp and knowledge of the following key areas: 1. Additionally. Sources of Bank Funds – All products of Banking for Wealth Management 7. Hudgins. Bank Management by Timothy W. Credit Appraisal and Lending Decisions: A Risk-return Framework by Hrishikesh Bhattacharya. Learning Outcomes: This course is aimed at imparting knowledge on the balance sheet dynamics and financial management of banks and institutions so as to understand the balancing acts of liquidity and profitability and risk management. Excel Books 2 .

com (Tamal Bandhopadhyay’s column: Banker’s Trust) III.S.livemint.ASSESSMENT CRITERIA: Session No.f.S. Skylark Publications g. Handbook of Banking Information by N. 3 . Skylark Publications Journals: Online Resources: www. Bank Finance for Industry and Trade by N. 12 24 Parameter Mid term End term Session NoParameter 8Group Presentation 12Mid term 24End term examination Weightag 40% 60% Weightage 20% 20% 60% Please ensure that you all have a minimum of 75% attendance in order to sit for the end term examination.Toor.Toor.

Tamal Bandyopadhyay. 2010) ‘ET in the classroom: Credit info bureau’ The Economic Times (January 27.605 Rose and Hudgins ‘Why sub-PLR lending should be banned. loan defaulters can run but not hide’ The Economic Times (April 09. Mint (April 12. SESSION PLAN Session 1 2-3 Topic Overview of banks and Financial Service Sector Regulations in the banking sector & Organisation and Structure of a bank Understanding Financial statements of a Bank Asset-Liability Management Techniques and Hedging against Risk Managing the Investment Portfolios and Liquidity Position of Banks Manging the Sources of Funds for Banks Lending Policies and Procedures Pre.Readings Page 3-22 Rose-Hudging Page 31-90 Rose-Hudging Chapter/Activit Chapter 1 Rose and Hudging Chapter 2-3Rose an Hudging 4-6 7-8 Page 129-185 Rose and Hudging Page 207-300 Rose and Hudging Chapter 5-6 Rose a Hudging Chapter 7-9 Rose a Hudging 9-10 11-12 13 Page 307-375 Rose and Hudging Page 387-502 Rose and Hudging Page 516-532 Rose and Hudgins Chapter 10-11Rose and Hudging Chapter 12-15 Rose and Hudging Ch 16 Rose and Hudgins Ch 15 Koch and Macdonald Ch 18 Rose and Hudgins 14 Consumer Loans/ Retail Banking-1 Types of Loans Subprime Loans Credit Cards Page 583. 2009) 15 Consumer Loans/ Retail Banking-2 Evaluation: Judgemental and Credit Scoring Role of CIBIL ‘Now. 2010) ‘A Man Who Governs Credit Is Denied a Toys ‘R’ Us Card’ Wall Street Journal (December 14.IV. 1995) Page 544-552 Rose and Hudgins Internet sources 16 Business Loans/Corporate Banking Assignment: page 5 Rose and Hudgins 4 . now’ Banker’s Trust.

139 N. agrilending and Nonperforming assets Microfinance IT in Banking 23 24 ‘Financing microfinance – the ICICI Bank partnership model’Bindu Ananth RBI speeches: ‘Information Technology and 5 .580 Rose and Hudgins Page 121. Banker’s Trust. Tata McGrawHill.11. Mint (December 27.629 Hrishikesh Bhattacharya Page 11.Tamal Bandyopadhyay. Vijayaragavan Iyengar Chapter 11.S. Project 22 analysis Priority sector lending.- Types of business loans: short-term and long-term ‘Next decade’s theme: credit substitution’.Toor Page 390-470 Hrishikesh Bhattacharya 18 19 20 Questions on credit appraisal Non-fund based lending Project appraisal and financing-1 Non-financial appraisal Financial appraisal Project financing-2 Risk analysis Sensitivity Page 576.39 Projects by Prasanna Chandra. 7th Edition Chapter 23 and 24.2. Toor Page 544-583 Hrishikesh Bhattacharya 21 Page 584. 2009) 17 Credit AppraisalWorking Capital Finance for working capital Data/information for assessment Determining the quantum of bank finance Page 83-120 N.S. SME lending.

The organisation and structure of Commercial Banking Industry. Reserve and Monetary policy of India and its evolvement since liberalisation. Session 7-8 covers : Recent developments in the banking sector. Session 11-12 covers: Types of deposits and different interest rates offered on them. Role of RBI. Concept of Efficiency and Cost-Do bigger banks operate at Lower cost? Role of Mergers and Acquisition in Reshaping the structure of a bank. Various Terminology used in banks. popular money market and capital market investment instruments. Session 4-6 covers: Basic Concepts. BPLR. Subbarao on May 18. Liquidity and Reserve management strategies. Analysing Banks balance sheet. eg PLR. Camel's Rating. Keynote address delivered by Dr.rbi. Key Risks in Banks. balance sheet format. D.org. Special mention to Sarbanes Oxley Accounting Standards act (2002). Introduction to type of Banks. Session 2-3 covers: Regulations affecting Banking sector. Introduction to Assets and Liabilities in a Bank. Internal Organisation of a banking firm. Evaluating Performance using Financial Ratios.Banking’. What is a financial institution. 2009 http://rbidocs.pdf Session Details: Session 1 covers: What is a Bank. 6 . Basel I and Basel II Session 9-10 covers: Investment Instruments available to financial firms. using marginal cost to set interest rates on deposits.in/rdocs/Speeches/PDFs/ GOVSPC1805. Pricing deposits. Role of FI in the economic development. How much capital is really required. investment maturity strategy. The Basel Agreement-Basel I and II. Base rate.

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