Credit monitoring – is something of lender control of the complete procedure of lending – it is manifested in continual control of the passing of specific financial loans, as well as the top-notch the mortgage profile overall.
Monitoring could be of two types: tabs on the loan customer and monitoring of the financing lender.
Most the products of the bank participate in the track of the borrower: appropriate, safety, functional, if necessary – devices engaged in foreign currency functions and securities transactions, analytical, as well as others. Needless to say, the credit department plays the main role.
Loan officer is obliged to correct the monitoring activities and report regularly about the development made with the distribution of analytical conclusions towards degree of risk for each loan, and credit supervisor – about a bank’s loan profile all together.
Seeing for a credit is targeted at collecting information on the fund receiver during the period which is why the loan is granted, to enforce control of the alteration the worse for the bank-side of this information that’s the basis when it comes to major evaluation for the solvency regarding the debtor.
Track of credit varies from a preliminary assessment of credit history:
– in line with the period of fulfillment. Check of credit standing is done before providing the credit, therefore the observation begins after the issuance of the loan;
– Relating to desired purpose. Credit check is conducted to determine risk before generally making your final decision on lending, and credit monitoring is carried out to determine the credit threat over time,when the credit is given;
– According to periodicity. Always check of credit standing is performed in its primary kind once, and tabs on loan is present, i.e. periodic or organized;
– Relating to volume – when determining the credit ranking, reliability for the fund receiver and security is assessed.
The purpose of keeping track of the loan is following:
coverage of the bank’s property from losses;
Fulfilment of regulatory needs of Central Bank;
Observance of problems of loan arrangement;
Maintaining the credit ranking of debtor on proper amount;
Enhancement associated with top-notch credit profile;
Well-timed business for the utilize issue lenders.
The item of tracking is conformity with all the loan agreement.
The lender attracts attention to the prompt distribution of all documents specified within the contract (monetary statements, certified by the Tax Inspectorate, the person transcripts towards the stability sheet, etc.), verifies the proper using credit, timeliness and completeness of repayment of principal debt and passions.