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Steps to ensure good quality of credit portfolio of a bank :
1. Choose high quality accounts - performance-wise based on track record of company / management, industry and business risk analysis, management risk analysis and analysis of projections.
2. Ensure the sanction includes all relevant conditions which are meaningful and achievable
3. Follow the sanction conditions thoroughly with no deviations and if required conduct double checking - maker / checker
4. Credit control / maintenance of the account is to be strengthened with defined rules and regulations across the bank, updated frequently on a regular basis
5. Conduct regular internal and external audits in a strict manner without leaving any levy
6. Change of staff handling the same accounts for a definite period on a defined frequency.This helps an analyst in identifying the mistakes committed by another analyst.
7. Ensure necessary training to all credit staff - both pre-sanction and post-sanction. Update them about the latest guidelines as well as frauds committed across the geographies. Cross bank training, Surprise tests, encouraging weekly group discussions among the staff and inviting external staff for lectures will add more value thus improving quality of the processing staff.
