The JAIIB exam, conducted by the Indian Institute of Banking and Finance, is designed to impart foundational knowledge in the banking sector. One of the primary topics covered in the JAIIB syllabus is the Loan Review Mechanism (LRM). This article presents a case study that highlights the importance of LRM. The case study also illustrates how a broad understanding of LRM can be beneficial for candidates.
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DOWNLOAD PDF LOAN REVIEW MECHANISM-CASE STUDY
The LRM is a significant element of a bank’s overall credit risk management structure. It determines the quality of loans, ensures compliance with lending policies, and identifies early signs of loan deterioration. The primary objectives of LRM include evaluating the loan portfolio to ensure asset quality. Ensuring adherence to regulatory guidelines. Detecting early warning signs of financial distress in borrowers. Taking corrective measures to minimize the risk of loans turning into non-performing assets (NPAs). Anti-money laundering and combating the financing of terrorism are important regulations and processes in the financial industry. Get additional information about it through our AML CFT and Reporting of Transactions YouTube video.
LRM emphasis on high-risk loan accounts and ensures that banks take timely actions to prevent defaults. This case study focuses on routine loan review, the bank’s credit risk team identified potential issues in its real estate loan book. Several developers face cash flow issues due to project delays, and early warning indicators suggest that these loans might become non-performing if disciplinary actions are not taken. Learning Sessions provides you course material via case study’s PDFs and YouTube links to excel in JAIIB Exam.
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To sum up, understanding the LRM is crucial, as it equips the knowledge to manage credit risk effectively in a future banking career. This case study will inform you about the practical application of LRM in real-world banking, offering valuable insights for JAIIB aspirants preparing for the exam. By mastering the concepts of LRM, candidates can succeed in the credit management module. For the complete preparation of candidates, get details through our YouTube videos for JAIIB PPB Module Wise Syllabus with explanations and tips to help candidates in their preparation journey.
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