Credit management in simple words is the process of monitoring and collecting payments from the borrowers. A specialized credit management system eases the amount of capital tied up with debtors. The principles of credit management revolve mainly around the concepts of safety, Liquidity, Diversity, and Profitability. The banks all over the world examine following details…
The volatility ratio (VR) is a statistical metric that measures the price changes of a security or market index over a period of time. It’s a technical analysis tool that helps investors and traders. In banking parlance, volatile liabilities are ‘hot’ or ‘unstable’ funds that can disappear from bank’s balance sheet overnight. Demand deposits are…
CASA stands for Current Account and Savings Account in banking parlance. Besides in India, the term CASA is popularly is used in West Asia and South-east Asia countries. The difference between the average yield of interest obtained from loans and the average rate of interest paid for deposits and other such funds (or the cost…
When borrowers unable to pay interest on time, it will add to principal amount of the borrower’s loan account at regular frequency. In the other words Capitalization frequency is the addition of unpaid interest to the principal balance of your loan. That means it is added to borrower’s Current Principal and interest will now be…
One more round of Bipartite Discussions was held between workman unions and IBA today at Mumbai. IBA was represented by Mr. Rakesh Sharma, (MD of IDBI Bank), Chairman of the Small Negotiating Committee, Mrs. Reeta Kaul, GM, PNB, Mr. S K Suri, GM, Allahabad Bank, Mr. B Rajkumar, Dy. Chief Executive, IBA, Mr. Sanjay Prakash…
The difference between fraud and cheating lies in their variety. Cheating is described under Section 415 of IPC. Section 415 states that “Whoever, by deceiving any person, fraudulently or dishonestly induces the person so deceived to deliver any property to any person, or to consent that any person shall retain any property, or intentionally induces…
The standardized approach for counterparty credit risk (SA-CCR) is a new computational method for exposure at default (EAD) under the Basel capital adequacy framework. This approach replaces the Current Exposure Method (CEM), used by banks in India, for measuring exposure for counterparty credit risk arising from derivative transactions, with effect from April 1, 2018. The…
The Current exposure method (CEM) is a measurement of the replacement cost within a derivative contract in the case of a counterparty default. Here, the credit equivalent amount of a market related off-balance sheet transaction calculated using the current exposure method which will be the sum of current credit exposure and potential future credit exposure…
We all know ‘Sample’ means a small part or quantity intended to show what the whole is like. Similarly, the ‘Random Sampling’ is a way of selecting a portion chosen from the population in order to make inferences about the whole population. For example, pre-polls or exit polls results obtained from random voters aims to…
A statistical hypothesis is also known as confirmatory data analysis which is testable on the basis of observing a process that is modeled via a set of random variables. Hypothesis testing is an act in statistics whereby an analyst tests an assumption regarding a population parameter. There are two different hypothesis viz. Null hypothesis and…
