Management of its loan portfolio

Credit is the most important area of ​​active operations carried out by the bank because the loan portfolio is primarily a third to half of all bank assets. In the structure of the bank's balance sheet loan portfolio is considered as one component of bank assets and having a level of profitability and risk. Therefore, for successful loan - repayment of loans and increase profitability of lending - banks need to implement an efficient and flexible system for credit portfolio management. The modern bank is able to offer customers over 200 types of various banking products and services, but lending is still one of its main functions. However, the acute is the problem loan portfolio quality. Thus, the inappropriate behavior of economic entities, and often inadequate bank management are pushing banks to hold too risky lending policies, which negatively affects their performance in general. Before the service of bank management problem into account a number of possible risks in lending activities, in particular, the risk of loan default. In such a situation it is important to skillfully manage the loan portfolio and credit risk specifically. Loan portfolio - a collection of credits granted by a bank on a certain date and it characterizes the amount of capital invested in bank lending. Loan portfolio includes an aggregate book value of all loans, including overdue, prolonged and doubtful to return. Category: Management Operations Commercial Bank | Tags: credit