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/ 20 Download this Document for Free EVALUATING RETAIL LOANS Contd CREDIT ANALYSIS/SCORING TECHNIQUES Credit Analysis includes 6cs namely character, capital, capacity, condition, collateral, compliance Credit Scoring covers certain steps are as followsJudgmental as well as credit scoring procedure Through score bank states the borrower in terms of risk Historical data on the performance of previous loan is analyzed good/bad weighted average of borrowing BANKING

Intensive competition Banks may compromise on quality of credit. Banks have to target specific customer base on individual behavior, needs and value. Customer data based stored in the bank would be handy. International trends shows that large losses can be related to retail loans portfolio. There is need to tread cautiously and manage risks proactively. Through portfolio of retail loans is better diversified

than corporate loans a systematic risk arising out of macroeconomics shock could still have a large negative impact. RISK MANAGEMENT & RETAIL BANKING Contd Risk includes following -

Deficiencies in lending policies Incorrect product structuring Inadequate loan documents Deficiencies in credit appraisal Inadequate risk pricing Inadequately defined lending limits

EMERGING ISSUES IN HANDLING RETAIL BANKING Knowing The Customer

b) Easier said than practiced c) Branch data warehousing d) Customer preferences, spending patterns Technology Issues g) Huge investment in technology h) New delivery channels, ATMs, credit cards etc. EMERGING ISSUES IN HANDLING RETAIL BANKING Contd Product Innovations

b) New products may not become successful c) Product should create value not amusement d) Can not sell the product on shelf Pricing Of The Product

g) Banking sector witnessing price war h) Transparency in pricing i) Minimum amount due, total amount due, processing charges not advertised in credit cards, so these are hidden charges EMERGING ISSUES IN HANDLING RETAIL BANKING Contd

HRD Issues b) Motivating frontline staff, project them as sales managers rather than as clerk c) Changing the image of the bank from transaction provider to solution provider Low Cost And No Cost Deposits f) Banks are in need of more s/b a/c and current a/c so that their cost of liability is less Retail Banking Download this Document for FreePrintMobileCollectionsReport Document This is a private document. Info and Rating Follow jyotinegi12 Share & Embed Related Documents PreviousNext

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