Establish a New Bank

Asset & Liability Management


Asset management strategy-

It is better for a cant not to take liability and equities for granted sum of deposits another borrowed fund depend not only the creditability of the bank but also on such other exogenic factors such as mind set or comparison of the clients.

Key decisions of assets which must be continuously related to the domain of deposits, equity and borrowed fund.

In short, if the Assets doesnt managed efficiently there provide be nonperforming loan and low return on enthronization it causes lower profitability and low margin.

For managing the assets three important aspects:

1. Is the borrower responsible for(p)?
2. Is the loan agreement property structured and well enter?
3. Can bank have claim in compositors case of default?

Judging the creditworthiness of borrowers:

1. character
2. capacity
3. cash
4. collateral
5. conditions
6. control


Brief explanation of six cs ar given below

CHARACTER: A person with a well behaved character is one who willingly and responsibly lives up to agreements. One distinctive sign of a good character is a responsible attitude toward paying bills and collision obligations on time.





CAPACIT: The ability to repay a loan or make hires on merchandise with
present income is know as capacity. Creditors want to make certain that you will have becoming money left over each month subsequently other fixed expenses have been met to pay your credit debts.

heavy(p); Property and other assets that total more than debts are known as capital. In other words, when you add up all told that you own (assets) and subtract all that you owe (liabilities), the difference (your illuminate worth or capital) should be sufficient to ensure payment of another bill.

CONDITIONS: All other existing debts, stability of employment, ad hominem factors, and other factors that might affect a persons ability or desire to meet financial obligations are important conditions to be considered. For...If you want to get a beat essay, order it on our website: Orderessay



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