Bank Lending Policies & Procedures

Bank Lending: Policies & Procedures Objectives of Lending Policies n           Resource planning to match lending outlay. n           Strategy to win over the nearest competitors. n           Augment good lending base with moderate risk involvement. n           Increased profitability. n           Ensure balanced loan ...

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Management of a Bank’s Equity capital Position

Management of a Bank’s Equity capital Position Capital n The long-term funds coming from debt & equity that support a bank’s long-term assets & absorb its earnings losses. Bank Capital & Risk n    Credit or Default Risk. n    Liquidity Risk. ...

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Liquidity & Reserve Management Strategies & Policies

Liquidity & Reserve Management Strategies & Policies Supplies of Liquidity Flowing into Banks. n    Incoming deposits. n    Revenues from the sale of nondeposit services. n    Customer loan repayments. n    Sales of bank assets. n    Borrowings from the money market. Demands ...

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The Investment Function in Banking

The Investment Function in Banking Functions of a Bank’s Security Portfolio n           Stabilize the bank’s income, so that bank revenues level out over the business cycle. n           Offset credit risk exposure in the bank’s loan portfolio. n           Provide geographic diversification. ...

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Asset-Liability Management

Asset Liability Management – Determining & Measuring Interest Rates Asset-Liability Management net    Control of a bank’s sensitivity to changes in market interest rates to limit losses in its net income or equity.  The principal goals of asset-liability management are: ...

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Financial Statement of Bank

Financial Statement of Bank The Income Statement of Bank The Balance Sheet of Bank (Report of Conditions) Bank Assets n           The Cash Account (Cash held in bank’s vault + Correspondent Deposits). n           Investment Securities (Money Market Securities: The Liquid portion) ...

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Establishing New Banks, Branches & ATMs

Establishing New Banks, Branches & ATMs •      Brings added prestige •      More Costly •      Subject to stricter regulatory framework •      Larger deposits/loan •      Technical assistance from national bank authorities •      Part of Federal Reserve System •      Federal banking rules can ...

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An Overview of Banks & Their Services

An Overview of Banks & Their Services What is a Bank? Expert’s Opinions n    “A dealer in debts – his own & of other people”.                                                             Geoffrey Crowther n    “A bank as an institution whose debts (bank deposits) are widely ...

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