Professional Documents
Culture Documents
ADVANCES
1. CREDIT APPRAISAL
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3. DOCUMENTATION
1. The security against which the advance was sanctioned was not available/was not on record.
2. Mortgage for the property given as security is not created.
3. Mortgage for the property given as security created, was inadequate, as compared to terms of
sanction.
4. Second charge as required, on assets was not created/ not on record.
5. Document pertaining to the registration of charges with ROC or any other concerned authority
requiring charging of assets is not obtained.
6. Copies evidencing lodgement of the original conveyance/ sale deed with the sub registrar for the
registration were not on record.
7. Authority letter/power of attorney to the bank to collect the original documents from the sub-registrar
was not on record.
8. Documents pertaining to consortium advances are not yet executed/ not available with the bank.
9. Documents were signed by persons who were not duly authorised to sign or who have signed in other
capacity but accepted by the bank.
10. Signatures of the executants were not found on all the pages of the documents.
11. Some of the documents on record were blank, without signature of the branch manager, witnesses or
guarantors etc.
12. Revival letter in respect of documents was not received.
13. In certain cases guarantees/guarantors have expired.
14. Guarantees were not taken/ renewed/ not on record.
4. REVIEW/MONITORING/ SUPERVISION
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Balance confirmation/ acknowledgement of debt are not obtained as per laid down procedure.
Periodic review/ renewal of advances are not done as laid down by bank.
Limit was renewed before the receipt of financial statement.
The stock, book debts statements were not received regularly/promptly.
FFI/ financial statements/ audited statements/ FFR 1&2/ other operational data, etc. are not received
regularly/ promptly/ not scrutinized and no suitable action is taken.
6. No penal interest has been charged for delay in submission of various statements as per the terms of
agreement depending upon the type of loan/ credit availed by the borrower.
7. Non-moving/ slow moving stock not deducted to arrive at the drawing power.
8. The age wise breakups of book debts were not found on record. The borrowers were allowed to draw
amount on entire book debt instead of age wise book debts as per sanction letter.
9. Wide discrepancies were observed in the stock statement and stock figures as reported in the annual
audited financial statements.
10. Stock audit reports not obtained.
11. Audited statements of non-corporate borrowers having limit beyond `10 lacs have not been obtained,
as per RBI guidelines.
12. Procedure laid down for physical verification/ inspection of securities charged to bank not followed.
13. Insurance cover for stock/ property is inadequate/ not on record/ not renewed/ not endorsed in favour
of the bank.
14. Advances that are eligible for whole turnover packing guarantee cover of ECGC were not brought
under its cover.
15. Security obtained is inadequate/lower as compared to outstanding/ no collateral security.
16. The account is frequently/ unauthorised overdrawn and the branches has not taken sufficient follow up
steps to regularise the account promptly.
17. Guideline prescribed by bank for security creation/asset inspection/ insurance and accounting in
respect of leasing finance activity not followed.
18. Credit card dues not recovered promptly.
19. IRAC norms prescribed by RBI for identification/classification of advances into standard/sub-standard/
doubtful/loss assets not followed.
20. Suitable changes not incorporated/suggested in MOC for disagreement with advance classification as
per IRAC norms.
21. Legal action for recovery/recall of advance was not taken although authorised by the controlling
authority by the controlling authority.
22. Non performing advance not promptly reported to controlling authority.
23. Claims for DICGC/ECGC not duly lodged and settled.
24. In the case of NPA, valuation report of fixed assets from approved valuer not taker once in three years
or shorter duration, if required.
25. Prescribed recovery policy not followed with respect to compromise/settlement and write off cases.
26. Drawing power limits are not revised as per market value of shares for advances against security of
shares.
27. End use of funds were not ensured/ not known. Funds were utilised for purpose other than for which it
was granted.
28. Major sale proceeds of the borrower were not routed through the bank.
29. Wrong application of rate of interest, processing charges, commission, other charges etc., resulting in
income leakage/ excess booking of income.
30. Export bills/foreign currency sight bills which were overdue, had not been crystallized.
31. In case of import credit, bill of entry evidencing import of goods was not found.
32. Govt. guaranteed accounts, which are irregular since long, the issue of invocation of guarantee, has
not been considered.
33. In case of allocated limits where full terms of sanction, stock statement, inspection report, margin
classification as per IRAC norms etc. are not available at monitoring branches.
34. In case of allocated limits, abnormal delays were noticed in responding to transfer by the allocator
branches.
35. The limit has been allocated while the outstanding balance at the year-end has not been confirmed by
the allocatee branch.
36. Cases where regular meeting were not held with other consortium members to review the
performance of borrower and to assess the current state of affairs/not been held as per the norms.
37. Individual members of consortium are not advised about the periodic operating limits/DP allocated to
each one of them.
38. In certain cases minutes of consortium meeting are not found on record/ meeting not been held as per
the norms.
39. Inspection report from consortium members is not obtained.
40. Capital of the borrower has been eroded/ net worth is negative/decreasing. Hence close monitoring is
required.
41. The borrower has not displayed signboard of bank, where pledged/hypothecated stock is stored.
42. In case of guarantees, opinion report/ financial statement/IT assessment order etc. of the guarantor
are not on record.
43. Pre sanctions and /or post sanction inspection report were not on record.
44. The borrower is absconding or deceased and legal formalities are in complete and there is wilful
default from the borrower. Either establishment was closed or security was disposed off or no action
taken by the branch.
45. Security disposed off/ entity closed by borrower and no action taken by branch.
46. The borrower was dealing with other bank though it was not permitted.