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BY:BY:

AASTHA SINGLAAASTHA SINGLA

RR1709B56RR1709B56

30200701083020070108

LOAN AND ADVANCESOF

PUNJAB AND SIND BANK



CONTENTSCONTENTSy Introduction

y Functions

y Loan schemes for customer at a glance

y

Complete loan schemey Loan policy

y Appraisal & sanction of loans

y Risk pricing policy & credit rating system

y Working capital assessment

y Graphical presentation

y Problems

y Recommendations



INTRODUCTIONINTRODUCTION

y Founder : Bhai Vir Singh Ji , Sir Surinder Singh Ji , Sir

Tarlochan Singh Ji in1908

y Headquarters : R ajendra Palace, N.D

y Zonal Offices : 19

y Branches : 754

y Extension Counters : 136

y Capital : 243.06 crores

y Total Deposits : 13223.62 crores

y Provides customer services

y R ural development Center in Ludhiana

y

9 international banking divisions



FUNCTIONSFUNCTIONS

y Primary functions :

Accepting of deposits

Advancing of loans

Secondary functions :

Agency functions

General utility services

Development functions



ME MBERS IN PANIPAT ME MBERS IN PANIPAT BRANCHBRANCHy Sr manager : VK Dhavan

y Loan Head : DS Kapoor

y Manager : PS Chawla

y Astt. Loan dept. : PK Gupta

y Manager (foreign exchange) : Amarjit Singh Saggu

y Head Cashier : Kuldeep Singh

y Assistant : Subash Singla

Mahendra Ahuja



LOAN SCHE ME FOR LOAN SCHE ME FOR

CUSTO MER AT A GLANCE CUSTO MER AT A GLANCE

With Punjab and Sind Bank, you get the personal touch and quality of

service that only we offer. Our schemes are designed around the best

interest rates and involve simplest procedure.



CO MPLETE LOAN SCHE ME CO MPLETE LOAN SCHE ME

(KHETI UDYOG KHAZANA YOJANA)(KHETI UDYOG KHAZANA YOJANA)

y Eligibility : Atleast one acre irrigated land

y Area of operation : Punjab, Haryana, U.P. & Sri Ganganagar Distt Of

R ajasthan

y Limit : R s 7.50 lacs for 10 yrs. 50000/- acre for irrigated & 15000/-

for unirrigated land.

y Security : Primary

y Repayment

y Rate of Intt. : As per R BI guidelines depending upon the quantum of

loan

y Margin : Upto 25%



LOAN POLICY LOAN POLICY

y Objective of the loan policy

y Thrust area of lending

y Term loans

yBank policy for finance against shares & debentures.

y Loan pricing ± Credit rating

y Delegation of discretionary lending power

y Loan committees

y Takeover of borrower A/C from another bank

y Casual/ temporary limit

(contd«.)



(contd«.)(contd«.)

y Loan proposal sanction thereof

y Loan policy assessment of working capital

y Classification of advances

y Collateral security

y Release of title deed



APPRAISAL AND SANCTIONAPPRAISAL AND SANCTION

OF LOANSOF LOANSy Preparation of loan proposal

y Loan officer to have proper knowledge

y Obtaining papers, documents, information

y Credit report on borrower/ guarantor

y Obtaining financial statements

y Some important borrower accounts

y Advances to relative of staff members

y Undertaking/ declaration from the clients

y Goods offered as security

y Immovable property as security/ additional security

(contd«)



(contd«)(contd«)

y Visit to the unit

y B/O to check

y Zonal office to check

y Sanction letter



RISK PRICING POLICY ANDRISK PRICING POLICY AND

CREDIT RATING SYSTE MCREDIT RATING SYSTE M

Background :

y The small borrowers would continue to be protected and they

enjoy credit limit upto Rs. 25000 will be charged int @ 11.5% PA.

y If the credit limit of borrowers would be deregulated then bank

would be required to obtain approval from their respective boards

for fixation of min rate of interest.

y CRR & SLR requirement have been reduced to 4.75% &

25%respectively over a period of last 8 years.



Prime lending rate:

y The lowest interest rate offered to the most trustworthy borrowers

i.e. where the credit risk is almost non-existing or near to zero.

y It determine on the basis of following factors:

a. Cost involved

b. Competition in the market

c. Relationship

d. Value

The factors are normally governed by the market forces and the

banks are unable to have any control over it.



Credit risk

It is delay in repayment by the borrower or not paying the

advances at all. This cause mismatch between the maturities of

assets and liabilities and banks may have to suffer/bear loss and

re-establish near equilibrium between the two.



Credit rating

y Assessment of the degree of risk associated with each loan a/c

and its profitability.

y Minimizing the risk by proper pre-lending appraisal,

documentation, disbursement and post leading care.



Credit rating system of our bank

Our bank has also devised its own credit rating system and risk pricing

policy. It is applicable to all working capital advances exceeding Rs 2

lakh and for term loan repayable in 3 years and above.

RATING PARAMETERS

The borrowers are divided into 4 categories

A++ A+

A B



Advantages of credit rating system

a. It is a cost ± plus pricing policy

b. Profitable margin will be clear and transparent

c. It serves as a major indicator of the impact of changes in

monetary policy.



W ORKING CAPITAL ASSESS MENT W ORKING CAPITAL ASSESS MENT



GRAPHICAL PRESENTATION OF GRAPHICAL PRESENTATION OF

BRANCH OFFICE, PANIPAT BRANCH OFFICE, PANIPAT



GRAPHICAL PRESENTATOIN OF GRAPHICAL PRESENTATOIN OF

BANK BANK



PROBLE M S:PROBLE M S:

y The major problem is that bank is non-computerized in many branches.

y Also the branches which are computerized don¶t have full connectivity.

y Poor recovery is also lending to higher account of NPA.

y The employees have only those skills required for doing general banking

work. They lack in marketing, selling and product development capabilities

needed for the success in retail banking.

y The branch managers don¶t have adequate powers, so they have to send

most of the files to their superiors for final approval. This takes a lot of

time and customers who need loan immediately have to wait.

y The formalities which are to be fulfilled by the customer for final approval

of loan are much more than in case of private banks.

y There is lack of motivation among the employees for during work is

lacking.



RECO MMENDATIONS:RECO MMENDATIONS:

y Branches should be fully computerized

y Full connectivity between branches should be established to enable the

customer to take benefit of anywhere banking

y Proper recovery system should be established

y

More ATM¶s should be established

y Training to the employees should be provided from time to time to keep

them updated. This will also help them to work effectively

y More powers should be delegated to the branch manager

y One person should be made to sit at the ³may I help u: counter permanently to help the person who are illiterate and those who have

some problem in filling of various forms of bank

y Formalities required for taking loan should be reduce to minimum in

order to make the bank competent against the private banks



M Y PERSONAL VIE W S M Y PERSONAL VIE W S TO W ARDS TRAINING TO W ARDS TRAINING

y FR IENDLY ATMOSPHER E

y MOTIVATION

y KNOWLEDGE

y PR ACTICAL EXPER IENCE

y PR OPER GUIDANCE



THANK YOUuuuu THANK YOUuuuu

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