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ANDHRA PRADESH
Name : Sreenivasa Rao B.
Designation : Lecturer in CCP
Branch : Commercial and
Computer Practice
Institute : S.U.V.R&S.R GPW,
Ethamukkala
Semester : VI Sem
Subject Name : Banking II
Subject code : CCP-604(B)
Major Topic : Loans and Advances-short
term & Long term
Duration : 50 minutes
Sub Topic : Principles of sound lending
policy
Teaching Aids : PPTs CCP604(B).1 1
Objectives :
On completion of this period you will be able
to explain:
Main advances offered by banks.
The Purposes for which banks are giving loans
and advances.
The Important precautions to be taken while
lending.
CCP604(B).1 2
What do you know about types of
Loans and advances offered by
Banks ?
Loans
Cash Credit
Overdraft
Discounting of Bill of Exchange
Hire Purchase advances etc.,
CCP604(B).1 3
For what purposes banks are giving
loans?
CCP604(B).1 4
Are there any precautions that banks
take while lending money?
Yes, they are
Safety
Liquidity
Profitability, etc.,
CCP604(B).1 5
Are there any precautions that banks
take while lending money – If so –
Why?
CCP604(B).1 6
General principles of sound lending of
Loans & Advances
Introduction
CCP604(B).1 7
General principles of sound lending of
Loans & Advances…
CCP604(B).1 8
General principles of sound lending of
Loans & Advances…
CCP604(B).1 10
Summary
CCP604(B).1 11
Summary
All loans entail a credit risk .
In order to be safe of repayments of loan
amounts the banker has to follow certain
principles of sound lending.
CCP604(B).1 12
Quiz
CCP604(B).1 13
Quiz
2. What precaution should be taken while
lending
a) Safety
b) Liquidity
c) Profitability
d) All the above
CCP604(B).1 14
Frequently Asked Questions
CCP604(B).1 15