Credit Management Systems

Theoretical Framework with Graphical Representation
3.1 Primary Discussion:
Risks be by their nature uncertain and prudence of hazards relies on popular opinion of risks and predictions about the future. Since uncertainty ordure adversely affect the profitability of the chamfer and it can also deplete the Liquidity. So, Jamuna brim circumscribed always tries to avoid any unforeseen problem. credit risk is the risk or loss that may occur from the blow of any counter party to make required payments in accordance with agreed terms and conditions. This section lends the fund what the hope mobilizes through its various deposit accounts. This is the second function of patoiss, 2 generic function deposit mobilization and creed creation. The study part of banks income is derived from credit and since the banks credit is customers fund, bank takes extreme caution in lending.
The true core credit business organisation of banking is the profitable management of risk. The Risk Management of Jamuna Bank confine evolves identification, measurement and controlling risks to ensure that
a. The Banks risk exposure is within the limits established by Board of Directors.
b. The Banks risk taking decisions are in the line with the business strategy and objectives set by the Board of Directors of the Bank as well as Bangladesh Bank guidelines.
c.



The Banks risk taking decisions are explicit and clear.
d. Sufficient working capital as a buffer is available to take risk.
one of the most crucial sides of arising risk is the credit department. The following chart might clear about that:

The above circle makes us clear that JBLs major portion of risk incubus is carried by the credit section. So the proper credit management systems are required to avoid or minimize the credit risk which contains possibility of affecting the Banks profit.

3.2 Concepts of Credit Risk of JBL:
It arises mainly from lending trade finance, leasing and treasury business. This can be described as potential loss arising from the...If you hope to get a full essay, order it on our website: Orderessay



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