Preparation of Credit Proposal

Preparation of Credit Proposal

At first formal application for the credit approval is submitted by the party. For this purpose borrower can use coarse paper or the form provided by the Bank.  Along with the application borrower also submits the documents required by the Bank. The Bank Manager evaluates all the documents provided by the borrower. He gets the party’s credibility report confidentially from the other commercial banks. He checks the balance sheet and income against the assets of the company. He also measures the proportion current and fixed assets in the total assets. He also measures the percentage of owner's equity. Then he does the ratio analysis of the company. If the company/party is involved in the export and import business, then the data of the last three/two years of the business is considered. The manager of the Bank also examines the projects viability. The securities provided by the debtor to the Bank are evaluated by measuring   their worth. In case of pledging, the value to the property pledged is assessed by the manager. While in case of new party manager checks from where the party is financing for their business.