The basic principles of credit policies of banks

1. Providing links monetary policy to the overall strategy of economic development. Credit policy should be considered as one of the essential elements of the overall economic development strategy of the bank and requires coordination with its deposit, the interest in politics, policy, management of banking risks. As one of the major elements that make up the overall economic development strategy, credit policy must be consistent in their goals with the overall strategy and not to enter into conflict with it. 2. Consideration in the development of monetary policy situation in the country and its development in a given period. Bank's credit policy is largely associated with the external environment, which is determined by the state of the state's economy. At the stage of Ukraine's transition to a market economy is the environment undergoes substantial transformation, which defines the new economic opportunities for individual areas of the bank credit policy. 3. Consideration in the development of monetary policy forecasting financial market conditions. In determining the strategic objectives of the bank on the volume of its lending activities, the formation level of lending rates, forms and types of credit customers need to be projected and included some changes that are expected in this period in the financial market in general and in those market segments in which the bank holds (or is going to spend) their lending activities. 4. Ensuring compliance with legal norms of state regulation of lending activities of banks. As with other areas of economic activities of individual business entities, the credit activity of banks is subject to active regulation by the state. Forms of such regulation are the specific laws and regulations of the National Bank of Ukraine (for example, he established economic standards for the implementation of credit transactions). Strategic objectives and credit policy and mechanism for their implementation should not be in conflict with applicable federal, state regulation of lending activities. 5. Consideration of internal capacity and capabilities of the bank's development. The volume of credit the bank's activities, diversification of directions, the possibility of individual operations and the application of certain debt instruments are largely determined by the size of its share capital, the level of material-technical base and innovative technology, skilled credit managers, organizational structure, management and some other elements that characterize its internal resource potential. Category: Management Operations Commercial Bank