This document discusses financial credit risk in Indian banks. It introduces the topic of credit risk and how it can result from a deterioration in a borrower's credit quality. The main problems studied are data collection, banking policies, consumer perspectives, and data identification. The objectives are to evaluate credit risk management applications and determine shortcomings. The importance is examining credit risk management policies, models, and limit management. The literature review discusses past research on credit ratings for small/medium firms, evaluations of credit risk management in Turkey, and perceptions of lending to SMEs. The research methodology uses a questionnaire to validate the credit risk management policy with validity and factor testing.

1. FINANCIAL CREDIT RISK IN INDIAN BANKS
UNDER GUIDANCE OF : SUBMITTED BY :
MR. NIKHIL MISHRA ABHINAV CHANDRA SRIVASTAVA
DEPARTMENT OF MANAGEMENT ROLL NO:- 1812270001
SRMGPC, LUCKNOW MBA 4RD SEMESTER

2. INTRODUCTION ABOUT THE TOPIC
• Credit risk or losses result from reduction in portfolio
value arising from actual/perceived deterioration in credit
quality. Credit risk emanates from a bank’s dealings with
an individual, corporate, bank, financial institution or a
sovereign.
• In recent years, financial sector failures and banking
sector weaknesses have induced policy makers

3. PROBLEM OF STUDY
Now a days the banking system in India is facing the credit risk the main
problem arises in the studies of the research are
• *Data collection
• *Banking policies
• *Consumer point of view
• *Data identification
• *Research of conclusion
• *Assessment from Banks

4. OBJECTIVE OF STUDY
The main purpose of the study is to evaluate credit risk management applications
and to determine shortcomings.
*To evaluate credit risk management policy determines the monitoring of credit of
banks.
*To evaluate credit risk management policy determines the credit risk models of
banks.
*To examine credit risk management determines the credit limit management of
banks.

5. IMPORTANCE OF STUDY
The most important aspects of the study are as follows :-
• *The risk managers are of the opinion that, the ‘direct lending activities.
• *Regarding the authority for approval of the Credit Risk Policy.
• *To identify the application of Credit risk management in banks.
• *Factors related to bank CRM policy.
• *Loan Disposal and Borrowers Profile is identified as a mirror.
• * Loan Disposal and Borrowers Profile
• * Determinant of Monitoring Credit limits

6. LITERATURE REVIEW
• Treacy and Carey (2000)
found that the qualitative factors played more of a role in determining the ratings of loan to small and medium
– sized firms
• Adem Anbar (2006)
evaluates the credit risk management applications in the Turkish bank sector. His findings also indicate that
banks should accelerate their studies and preparations which are related to data about borrowers and loans that
are used in credit risk measurement.
• World Bank Group (2007)
the study describes the main features of the supply side of SME financing by analyzing the perceptions of
banks in Argentina and Chile regarding lending to SME
• Anna and Antonio (2005)
• the study has been highlighted in the proposed Basel Accord II that includes the internal rating approach to
credit risk

7. RESEARCH METHODOLOGY
• The method used to validate the Credit Risk Management Policy Questionnaire is based on 26 questions having likert’s
scale and 3 open ended questions which included:
• Translational Validity: Content Validity and Face Validity
• Conceptual framework using past literature was designed and had 3 expert opinion to review its consistency was done.
• Face Validity required the clarity of wording, likelihood of respondents and its layout and style.
• Construct Validity: The sampling population for the factor analysis included 68 respondents from Chennai who are bank
managers.
• Factor analysis: is used to cluster items, into common factors with items having the highest loading.

8. BIBLIOGRAPHY
• Treacy, W.F., Carey, M.2000,”Credit rating systems at large U.S Banks,” Journal of Banking
and Finance, 24,167-201.
• BCBS, 1999,”Credit risk modeling: current practices and approaches”, BASEL, 1-58.
• Anna P.I.Vong.,AntonioPires Patricio, 2005, “Internal credit rating systems in the Macao
Banking System” Euro Asia Journal of Management, Vol.15,No2, 123-137.

9. THANK YOU