Indian Overseas Bank provides various types of loans and advances to customers. These include secured loans like term loans which are granted against assets and can be paid back over longer periods. They also offer unsecured loans like demand loans which are repayable on demand. The bank aims to meet business needs through flexible financing options like cash credits while ensuring safety of funds through security and assessing borrower creditworthiness. A study of IOB's Ashoknagar branch found that term loans contribute significantly to advances and customers appreciate the bank's service, suggesting they focus on faster loan processing and financial education.
The complete analysis of Cash Credit given by Bank. The ppt covers topics like definition, objectives,advantages, disadvantages,Drawing Power, calculation of Interest and Drawing power
The report deals with a clear understanding of the lending procedures followed by Indian Overseas Bank. It not only explains the basic concepts and the terminologies used in the banking sector but also gives an insight into the legal aspects and the paper work required for final sanction of a loan proposal.
The complete analysis of Cash Credit given by Bank. The ppt covers topics like definition, objectives,advantages, disadvantages,Drawing Power, calculation of Interest and Drawing power
The report deals with a clear understanding of the lending procedures followed by Indian Overseas Bank. It not only explains the basic concepts and the terminologies used in the banking sector but also gives an insight into the legal aspects and the paper work required for final sanction of a loan proposal.
Loans and Advances
Principles of Good lending
Creditworthiness of borrowers
Securing advances
Lien
Pledge
Mortgage
Hypothecation
Documents of title to goods
Life Insurance Policy
Fixed Deposit Receipts
Mutual Funds
Government Securities
Gold Loans
General Principles of Lending:
When a request for a loan is received, it is important to ensure that the borrower has the legal capacity to borrow. The other matters upon which the information should be obtained are: the purpose of advance, the amount involved, the duration of the advance, the sources of repayment, the profitability of transaction, and, where applicable, the security offered. The most fundamental principle of all is that the bank should have confidence in the integrity, competence and continuing credit worthiness of the borrower.
• Know Your Customer:
While entertaining a proposal for advance, the branch has to first ensure compliance with the KYC norms.
• Pre- Sanction Stage:
Obtain/compile the following:
• Bio-data/declaration of assets owned by the borrower and guarantor along with latest income tax/wealth tax assessment copies and compilation of opinion reports.
• Particulars of immediate family members/legal heirs along with their father’s name and age.
• Audited balance sheets for the previous 3 years, estimated balance sheet for the current year and projected balance sheet for the next year.
• Particulars of existing borrowing arrangements and credit reports/no objection letters from existing banks if any.
• It should be followed by independent verification by the branch incumbent.
• Details of associate/group concerns, their borrowing arrangements and their latest balance sheets.
• No objection letter from term loan lender(s) if already financed by them and their permission/willingness to cede pari passu/ second charge on their security.
• The position of term working capital liabilities with various banks/FIs and details thereof viz., Limit, DP, Out standings, Irregularities (if any).
• Conduct a search/obtain a search report from Registrar of Companies to ascertain position of charges created already.
•
• Due Diligence:
• Branch Manager should do adequate Due Diligence before bringing an asset to the Bank’s books. This will avoid NPA.
• Thorough inquiry about the prospective borrower (with other banks, Financial Institutions, etc.) market intelligence, his past track record of performance and repayment of obligations, credit worthiness (Net Worth) must be done.
• Personal visit to his office/place of business will give an idea of his business.
• Processing of Applications:
While processing the applications, the following should be looked into and commented upon in the proposal:
• Due diligence on promoters’ background, their track record of repayment by checking with their existing bankers (NPA status) (any rephasements, any compromise entered into), credit worthiness, market reputation etc.
• Latest RBI defaulters’ list and willful defaulters' list —Company and their Directors.
• Bank’s loan policy.
• Contractual capacity of the borrower regarding borrowing powers/any restrictions on borrowings and names of persons authorized to borrow by verifications of:
• Partnership deed
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[Note: This is a partial preview. To download this presentation, visit:
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Sustainability has become an increasingly critical topic as the world recognizes the need to protect our planet and its resources for future generations. Sustainability means meeting our current needs without compromising the ability of future generations to meet theirs. It involves long-term planning and consideration of the consequences of our actions. The goal is to create strategies that ensure the long-term viability of People, Planet, and Profit.
Leading companies such as Nike, Toyota, and Siemens are prioritizing sustainable innovation in their business models, setting an example for others to follow. In this Sustainability training presentation, you will learn key concepts, principles, and practices of sustainability applicable across industries. This training aims to create awareness and educate employees, senior executives, consultants, and other key stakeholders, including investors, policymakers, and supply chain partners, on the importance and implementation of sustainability.
LEARNING OBJECTIVES
1. Develop a comprehensive understanding of the fundamental principles and concepts that form the foundation of sustainability within corporate environments.
2. Explore the sustainability implementation model, focusing on effective measures and reporting strategies to track and communicate sustainability efforts.
3. Identify and define best practices and critical success factors essential for achieving sustainability goals within organizations.
CONTENTS
1. Introduction and Key Concepts of Sustainability
2. Principles and Practices of Sustainability
3. Measures and Reporting in Sustainability
4. Sustainability Implementation & Best Practices
To download the complete presentation, visit: https://www.oeconsulting.com.sg/training-presentations
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A Memorandum of Association (MOA) is a legal document that outlines the fundamental principles and objectives upon which a company operates. It serves as the company's charter or constitution and defines the scope of its activities. Here's a detailed note on the MOA:
Contents of Memorandum of Association:
Name Clause: This clause states the name of the company, which should end with words like "Limited" or "Ltd." for a public limited company and "Private Limited" or "Pvt. Ltd." for a private limited company.
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Registered Office Clause: It specifies the location where the company's registered office is situated. This office is where all official communications and notices are sent.
Objective Clause: This clause delineates the main objectives for which the company is formed. It's important to define these objectives clearly, as the company cannot undertake activities beyond those mentioned in this clause.
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Liability Clause: It outlines the extent of liability of the company's members. In the case of companies limited by shares, the liability of members is limited to the amount unpaid on their shares. For companies limited by guarantee, members' liability is limited to the amount they undertake to contribute if the company is wound up.
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Capital Clause: This clause specifies the authorized capital of the company, i.e., the maximum amount of share capital the company is authorized to issue. It also mentions the division of this capital into shares and their respective nominal value.
Association Clause: It simply states that the subscribers wish to form a company and agree to become members of it, in accordance with the terms of the MOA.
Importance of Memorandum of Association:
Legal Requirement: The MOA is a legal requirement for the formation of a company. It must be filed with the Registrar of Companies during the incorporation process.
Constitutional Document: It serves as the company's constitutional document, defining its scope, powers, and limitations.
Protection of Members: It protects the interests of the company's members by clearly defining the objectives and limiting their liability.
External Communication: It provides clarity to external parties, such as investors, creditors, and regulatory authorities, regarding the company's objectives and powers.
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Binding Authority: The company and its members are bound by the provisions of the MOA. Any action taken beyond its scope may be considered ultra vires (beyond the powers) of the company and therefore void.
Amendment of MOA:
While the MOA lays down the company's fundamental principles, it is not entirely immutable. It can be amended, but only under specific circumstances and in compliance with legal procedures. Amendments typically require shareholder
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Cracking the Workplace Discipline Code Main.pptxWorkforce Group
Cultivating and maintaining discipline within teams is a critical differentiator for successful organisations.
Forward-thinking leaders and business managers understand the impact that discipline has on organisational success. A disciplined workforce operates with clarity, focus, and a shared understanding of expectations, ultimately driving better results, optimising productivity, and facilitating seamless collaboration.
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4. INTRODUCTION
Meaning of Loans and Advances
The term "loan" refers to the amount borrowed by one person from another.
The amount is in the nature of loan and refers to the sum paid to the borrower.
Thus, from the view point of borrower, it is 'borrowing' and from the view point of
bank. it is lending'.
Loan may be regarded as 'credit. granted where the money is disbursed and its
recovery is made on a later date.
It is a debt for the borrower. While granting loans, credit is given for a definite
purpose and for a predetermined period. Interest is charged on the loan agreed rate
and intervals of payment.
'Advance' on the other hand, is a 'credit facility' granted by the bank. Banks grant
advances largely for short-term purposes
5. UTILITY OF LOANS AND ADVANCES
(a)Loans and advances can be arranged from banks in keeping with the flexibility in
business operations. Traders may borrow money for day to day financial needs
availing of the facility of cash credit, bank overdraft and discounting of bills. The
amount raised as loan may be repaid within a short period to suit the convenience of
the borrower. Thus business may be run efficiently with borrowed funds from banks
for financing its working capital requirements.
(b) Loans and advances are utilized for making payment of current liabilities, wage
and salaries of employees, and also the tax liability of business.
(c) Loans and advances from banks are found to be 'economical' for traders and
businessmen, because banks charge a reasonable rate of interest on such
loans/advances
6. DEMAND LOAN
A Demand Loan is a loan which is repayable on demand by the bank. In other words
it is repayable at short-notice.
The entire amount of demand loan is disbursed at one time and the borrower has to
pay interest on it.
The borrower can repay the loan either in lump sum (one time) or as agreed with the
bank .
For example, if it is so agreed the amount of loan may be repaid in suitable
installments. Such loans are normally granted by banks against security.
The security may include materials or goods in stock, shares of companies or any
other asset.
Demand loans are raised normally for working capital purpose like purchase of raw
materials, making payment of short-term liabilities.
7. Term loan
medium and long term loans are called term loans. Term loans are granted for more
than a year and payment of such loans is spread over a longer period. Term loan is
required for the purpose of starting a new business activity renovation,
modernization, expansion of existing units, purchase of their land for setting up a
factory, construction, of factory building or purchase of other immovable assets.
These loans are generally secured against the mortgage of land, plant and machinery,
building and the like.
8. NATURE AND SECURITY:
To ensure the safety of funds lent, the first and most important factor considered by
a bank is the capacity of borrowers to repay the amount of Loan, the Bank
therefore, realize primarily on the character capacity, and financial soundness of the
borrowers. But the Bank can hardly afford to take any risk in this regard and hinds it
also has the security of tangible assets owned by the borrower. In case the borrower
fails to repay the loan, the bank can recover the amount by attaching the assets.
9. TWO CATEGORIES OF LOAN
Thus from the view point of security of loans, we can divide the loans into
two categories:
A)secured,
(B) unsecured.
10. TWO CATEGORIES OF LOAN
UNSECURED SECURED
Unsecured loans are those loans Secured loans are those which
which are not covered by the are granted against the security
security of tangible assets. Such of tangible assets, like stock in
trade and immovable property.
loans are granted to Thus, while granting loan
firms/institutions against the against the security of some
personal security of assets, a charge is created over
the owner, manager or director. the assets of the borrower in
favor of the bank. This enables
the bank to recover the dues
from the customer out of the
sale proceeds of the assets in
case the borrower fails to repay
the loan.
11. Procedure for granting loans and
advances:
(i) Filling up of loan application form
(ii) Submission of form along with documents
(iii) Sanctioning of loan
(iv) Executing the Agreement
(v) Arrangement of Security for Loan
12. SCOPE OF THE STUDY:
The purpose of preparation of the report is to focus on the lending
function of banks with specific reference to Indian overseas bank with
specific reference to ashoknagar branch
The about different types of advances that are financed by the banks and
their classification into fund and non-fund based advances.
It also helps us to study the risk involved in sanctioning of advances to a
borrower. This makes us to analyze the credit worthiness of the
prospective borrower and estimate the net worth of the assets owned by
him, which assists the bank to ascertain the amount that can be sanctioned
to the borrower.
To study the securities that can be used against lending and the
calculation of equated monthly installments.
13. OBJECTIVE OF THE STUDY
PRIMARY OBJECTIVE
To study different types of the loans and advances made by IOB with specific
reference to ashoknagar branch
To make suggestions on the basis of the analysis.
To study in detail the various types of loans and advances offered by IOB with
specific reference to ashoknagar branch.
14. SECONDARY OBJECTIVE
To study the process involved in sanctioning loans and advances to a customer.
To assess the bank’s contribution towards fulfilling the requirements of the borrower.
To assess the satisfaction level of the borrower’s in terms of their being benefited by the
timely financial accommodation by the IOB with specific reference to ashoknagar branch
.
15. INDUSTRIAL PROFILE
BANKING INDUSTRY
Banks are the financial backbone of any country’s economy. Without a sound
banking system a country cannot have a healthy economy. A bank is a financial
institution which deals with money and credit. It accepts deposits from individuals,
firms and companies t a lower rate of interest and gives it at a higher rate of interest
to those who needs them. The difference between the terms at which it borrows and
which it lends forms the source of profit, thus bank being a profit earning institute.
16. INDIAN OVERSEAS BANK
Indian Overseas Bank Established in 1937, Indian overseas Bank (IOB) is a leading
bank based in Chennai, India. IOB had the distinction of simultaneously
commencing operating in three branches at karaikudi, Chennai and Yangon
(Myanmar). Since IOB aimed to encourage overseas banking foreign exchange
operations, it soon opened its branches in Penang and Singapore. Today, Indian
Overseas Bank boasts of a vast domain in banking sector with over 1400 domestic
branches and 6 branches overseas.
IOB was the first bank to venture into consumer credit, as it introduced the popular
Personal Loan scheme
18. NEED FOR THE STUDY
To identify the role of the IOB bank is providing assistance to the
borrower.
To assess the financial benefits derived by borrower with regards to the
term loan.
To suggest strategies for improving return on investment towards the
profitability of the bank through term Loan
To assess the borrower Loyalty towards the IOB bank.
19. LIMITATION
The following are the limitation faced
The personal details of the borrower have not been revealed as per the
norms of the bank.
The secondary data collected includes details published through
magazines journals and websites.
It also includes data collected and observed during the daily functioning
of the branch.
This branch deals only with certain types of loans and advances. Certain
loans like Agriculture, Insurance etc have not been covered under this
branch.
20. RESEARCH DESIGN
It is the arrangement of conditions for collection and analysis of data in manner that
aims to combine relevance to the research purpose with economy in procedure.
It is a master plan specifying the methods and procedure for collecting and analysis
is made on this primary data and secondary data collected for this project study.
It is based on the descriptive research techniques employing survey method and the
analysis is made on the both primary and secondary data collected for this project
study.
21. TYPE OF STUDY
Descriptive research includes survey and fact finding enquiries of different kinds.
The major purpose of descriptive research is description of state of affairs, as it exits
at present ; the methods of research utilized in descriptive research are survey of all
kinds including comparative method. The advantage of descriptive research is that
they provide a quick ,inexpensive , efficient and accurate means of assessing
information about the population.
22. METHODS LF DATA COLLECTION
Secondary data
The secondary data was collected through company profile, journals and internet.
Through secondary data was collected through company profile, Journals and
internet. Through Secondary data basic information about the organization was
known.
Primary data
The primary data are those that are collected fresh and thus happen to be original in
character; these are several methods of collecting primary data
Interview method
Questionnaire method
23. SAMPLE SIZE
Sample size was arrived at 50 after discussion with
Company guide
College guide and also taking into consideration the time constraint.
By dividing the time available for the project.
24. tool used
Tools used
Percentage analysis
Tables and charts
Percentage analysis
In case of multiple choice questions the response were categorized based on the nature and
percentage is calculated for each category. To find the percentage of responses in each
category the number of response for each category is used. The percentage is calculated by
dividing the number of responses by the total number of respondents.
Percentage =number of respondents /Total number of respondents *100
25. Data analysis
For making the analysis the study include both primary and secondary data .
Based on the information available , data will be analyzed and suggestions will be
recommanded.
26. FINDINGDS
From the study that it is found that the interest rate charged on loans
(term loans) has been showing constant increasing trend and the bank
gains more profit through the interest charged on loans and cash credit.
Among the total advances, the term loan contributes lions share
throughout the period..
Jewel loan is applicable to note that the bank is helping the middle by
granting loan against jewellary at a very reasonable interest and loais
sanctioning by the bank keeps on increasing from55% in the year 2008 to
122% in the year 2011 which shows the growth of the bank and that is
more needy benefited by the bank
The present NPA(Non performing assest) of the branch is Rs 49 lakhs
which is only 0.84% of total advances.
.
27. FINDINGDS
The total profit earned by the bank keep on increasing from the year from
46.84 in the year to 130.98 in the year 2011 to which shows that the
income of the bank by way of interest on loans and advances and by the
way of commission increased year after year.
Most of the people lack knowledge about credit facilities
.
About 34% of the respondents have availed loan from IOB bank for the
expansion of business. 24% of the respondents are associated with the
bank for the period of 9-15 years.
Many customers are very satisfied by the service provided by the bank
28. SUGESSIONS
Any changes in the interest rate must be informed to the customers.
Before sanctioning any loan the bank must clearly explains to its borrowers the
consequence for any non repayment.
Monitoring progress and strict adherence to payment schedule by the borrowers so
as to ensure reasonable NPA (non performing assets).
As a result of personnel survey conducted it was found that most of the customers
are in favor of higher amount of limits at lower rate on interest.
Just like Life Insurance of Corporation (LIC) IOB may also follow dual Interest rate
system on housing loan.
29. CONCLUSION:
Loans are to be processed faster by extending faster and efficient
customer oriented service. They should educate customers about credit
facilities in the bank. This will create greater confidence among the
interested parties which will help them to choose the most suitable
scheme.
The IOB Ashok nagar branch is able to enjoy appreciable return from
loan segment by winning the appreciation of the customers.
30. This research will be useful to the bank to understand its
customer’s position of awareness of its loans and advances
among customers